Organisational objectives 3 On completing this chapter you should be able to: Know and understand

CSR and corporate strategy changes
The changing corporate strategies of the world’s mining companies are an excellent 
example of how 
fi
rms may adopt di
ff
erent strategies towards their social responsibilities 
in response to pressure. In the 1970s and 1980s, many mining companies signed mineral 
extraction deals with undemocratic political regimes. Environmental concerns were 
given very low priority and the interests of the local or indigenous peoples (displaced by 
the mine workings) ignored. The Grasberg (West
Papua) and Bougainville (Papua New 
Guinea) gold and copper mines are useful case studies.
• In Bougainville, joint owners of the mine, RTZ and Freeport, allowed the government 
to use force to put down civil unrest caused by the displacement of people by the 
mine and its environmental damage. The company took a very tough line and military 
action took place next to the mine. Eventually, the company was forced to close it.
• The Grasberg mine, which opened later than Bougainville, bene
fi
ted from a very 
di
ff
erent objective by RTZ towards its social responsibilities as a result of the poor 
publicity over its policy in Papua New Guinea. A trust fund has been set up to spend 
1% of total mine revenue to fund village development. In addition, one quarter of the 
total workforce is drawn from local communities.
• RTZ went even further with the Jabiluka uranium mine in northern Australia. 
Publicity by the local Mirrar tribe and their supporters led to an unprecedented 
extraordinary general meeting of shareholders, which led to the mine being closed; it 
has never reopened.
Measuring CSR – social audits
Social audits
report on a 
fi
rm’s ‘social’ performance and are becoming an important way 
for businesses to report on their corporate social responsibility record. They assess the 
impact a business has on society and how e
ff
ectively its ethical behaviour matches up to 
its ethical objectives. Social audits can include an environmental audit (see above), but 
they give details of other impacts on society too. These include:
• health and safety record, e.g. number of accidents and fatalities
• contributions to local community events and charities
• proportion of supplies that come from ethical sources, e.g. Fairtrade Foundation 
suppliers
• employee bene
fi
t schemes
• feedback from customers and suppliers on how they perceive the ethical nature of the 
business’s activities.
The social audit will also contain annual targets to be reached to improve a 
fi
rm’s level 
of social responsibility and details of the policies to be followed to achieve these aims. 
By
researching and publishing these reports, 
fi
rms are often able to identify potentially 
social audit:
an 
independent report on 
the impact a business has 
on society. This can cover 
pollution levels, health 
and safety record, sources 
of supplies, customer 
satisfaction and contribution 
to the community

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