IMARC 2019 - Newcrest Mining Case Study
Dr Graeme Hancock, General Manager – Social Performance, Newcrest Mining presented at IMARC 2019 on “It starts with us: Responsibility, leadership and trust in the digital age”. Graeme explained the different barriers companies can encounter in community engagement, the importance of building trust and how to follow the Shared Value model.
Companies can encounter challenges when engaging with local communities. These challenges are often obstacles or barriers within the community wherein they resist change due to a lack of mutual understanding. In order to progress mining and METS companies need to engage with their local community to understand their point of view before moving forward together for a mutually beneficial outcome.
Barriers will take on different forms depending on the context of the community, and even then, they may be unique from site to site. Broadly speaking, within Australia challenges can arise around a difference in the mindset towards the land. Indigenous communities connect with the land and see themselves as custodians, which can present as a barrier. As such, it is important for businesses to match this mindset and approach the land as more than a tradable commodity.
Within the developing world challenges can arise around differences in customs or education levels. There is an obligation on companies to truly understand the people within the local community to ensure authentic shared value can be reached. In developing countries, some factors to consider include divergent socio-political systems, limited access to capital for business growth and lack of trust in foreigners.
Regardless of what barriers companies face, it is essential to build trust with the community. This is the first step of bridging any differences and essential in order to arrive at a position to develop a shared vision.
“You cannot build anything around a community if they don’t trust you."
Companies should be looking at creating building blocks for future growth by doing the right things at the right time in the right context. As such, it is vital that to honour your pledge and stay consistent through both the good times and the bad. To break this down, companies need to ensure their actions to match their words if they want to build trust with their communities.
Case Study – Newcrest Mining’s Wafi-Golpu project and the Lower Watut Cocoa Growers
Newcrest Mining worked at building resilient communities around their Wafi-Golpu project in Papua New Guinea. The project lies in the mountains adjacent to the Lower Watut Valley. The community opportunities for direct employment will be limited, so there was a need to develop Shared Value.
Wafi-Golpu Joint Venture (WGJV) agreed with the community to support development of an economic ecosystem surrounding the project. Their community engagement led to an agreed and shared vision for agribusiness development in the surrounding area where cocoa was an existing cash crop. However, they needed support in order to enlarge plantations and improve product quality. WGJV partnered with an NGO to give technical support to local farmers in order to establish a hybrid seeding nursery and improve cocoa quality.
The key with this case study is that Newcrest didn’t have all the skills required to achieve the end results, with Graeme noting “Our company is not in the agriculture business”. Instead Newcrest partnered with not just the community but with local farmers and businesses in order to see the community benefit from their relationship with the miner. As such the Wafi-Golpu project saw strong and varied benefits for the local community, beyond what would be possible with the donor-recipient model, including increased in cocoa quality to the extent the Lower Watut Cocoa Growers Association won a prestigious “Salon du Chocolat” prize for best cocoa quality in Paris in 2015.
Companies need to take the time to listen to their community’s unique needs and create new community engagement plans rather than attempting to follow a templated approach.