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ISBN 978-952-61-3351-5 ISSN 1798-5757
Dissertations in Social Sciences and Business Studies
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THE UNIVERSITY OF EASTERN FINLAND
Mining in the European Arctic is rising in terms of applications of new exploration and
production licenses. In the Barents region countries, there remains a political will in national governments to utilise natural
resources and strengthen the regional economies.
This study covers diverse elements of Corporate Social Responsibility (CSR) in the
metal mining industry in the far north of Europe, including mining case studies from Finland, Norway, Sweden and the northwest of
Russia.
ADRIAN BRAUN
DISSERTATIONS | ADRIAN BRAUN | CORPORATE SOCIAL RESPONSIBILITY IN THE BARENTS REGION | No 219
ADRIAN BRAUN
CORPORATE SOCIAL RESPONSIBILITY IN THE BARENTS REGION:
A Situational Analysis of Metal Mining
CORPORATE SOCIAL RESPONSIBILITY IN THE BARENTS REGION:
A SITUATIONAL ANALYSIS OF METAL MINING
Adrian Braun
CORPORATE SOCIAL RESPONSIBILITY IN THE BARENTS REGION:
A SITUATIONAL ANALYSIS OF METAL MINING
Publications of the University of Eastern Finland Dissertations in Social Sciences and Business Studies
No 219
University of Eastern Finland Joensuu/Kuopio
2020
Lapin yliopistopaino Rovaniemi, 2020
Editor-in-Chief/Sarjan vastaava toimittaja: Markus Mättö Editor/Sarjan toimittaja: Markus Mättö
Myynti: Itä-Suomen yliopiston kirjasto ISBN: 978-952-61-3350-8 (nid.) ISBN: 978-952-61-3351-5 (PDF)
ISSNL: 1798-5749 ISSN: 1798-5749 ISSN: 1798-5757, (PDF)
5 Author’s address: Institute for Natural Resources, Environment and Society
University of Eastern Finland JOENSUU
FINLAND
Doctoral programme: Social and Cultural Encounters (SCE) Supervisors: Professor Rauno Sairinen, Ph.D.
Environmental policy University of Eastern Finland JOENSUU
FINLAND
Research Professor Monica Tennberg, Ph.D.
Arctic Centre
University of Lapland ROVANIEMI
FINLAND
Reviewers: Professor Tapio Litmanen, Ph.D.
Department of Social Sciences and Philosophy University of Jyväskylä
JYVÄSKYLÄ FINLAND
Professor Armi Temmes, Ph.D.
Department of Management Studies Aalto University
ESPOO FINLAND
Opponent: Professor Tapio Litmanen, Ph.D.
Department of Social Sciences and Philosophy University of Jyväskylä
JYVÄSKYLÄ FINLAND
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7 Braun, Adrian
Corporate Social Responsibility in the Barents Region: A Situational Analysis of Metal Mining.
Joensuu/Kuopio: Itä-Suomen yliopisto, 2020 Publications of the University of Eastern Finland Dissertation in Social Sciences and Business Studies; 219 ISBN: 978-952-61-3350-8 (print)
ISSNL: 1798-5749 ISSN: 1798-5749
ISBN: 978-952-61-3351-5 (PDF) ISSN: 1798-5757 (PDF)
ABSTRACT
Metal mining is currently under way in several Barents region areas and is being highly promoted by governments in all Barents region member states: Finland, Norway, Russia and Sweden. Mining creates local and regional wealth, and is thus linked to economic and societal development, but it is a subject of controversy among the different social groups in the European Arctic. The industry is accountable for numerous ecological impacts in an overall vulnerable Arctic ecosystem. Thus, the Barents region mining industry faces substantial sustainability challenges. The question arises, of how to address the thematic area of Corporate Social Responsibility (CSR), meaning which social and ecological responsibilities should be accepted. It is of interest to consider how industrial actors understand the overall concept of CSR and which corporate actions result from it. This dissertation embraces three key elements to enlighten the specific Barents region mining CSR discourse. The analysis reveals the major incentives of corporate actors to implement CSR policies and strategies in their operations. The most relevant sustainability/CSR standards in mining are considered as well as the extensive stakeholder universe of metal mining corporations. Interviews with corporate mining representatives from all four Barents region member states and mining experts from NGOs and geological surveys are an essential element to gain insights into the motivation of CSR, stakeholder groups and the applicable sustainability/CSR standards. In this study, an analysis of interviews and secondary literature follows qualitative research methodologies, predominantly situational analysis, including analytical techniques that are elements of grounded theory. The metal mining industry and its stakeholders can greatly benefit from CSR. The study shows how industry could gain advantages in monetary and non-monetary terms, by implementing CSR activities. The stakeholders in mining do not fit entirely into a single-category box, as they comprise many different groups with different demands and expectations towards mining. However, this work outlines that CSR
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practices inside mining can generate positive impacts for almost every actor involved, inside and outside the industry. Sustainability/CSR standards can be a helpful tool to implement CSR on all corporate levels in mining, by consideration of which standards, in the myriad of available frameworks and guidelines, are the standards that allow achievements of optimum, continual improvements of ecological, social and economic aspects.
Keywords: Corporate Social Responsibility (CSR), Barents region, Stakeholder Management, Metal Mining, Arctic ecosystem
9 Braun, Adrian
Yritysten yhteiskuntavastuu Barentsin alueella: Metallimalmikaivosten tilanneanalyysi.
Joensuu/Kuopio: Itä-Suomen yliopisto, 2020.
Publications of the University of Eastern Finland Dissertation in Social Sciences and Business Studies; 219 ISBN: 978-952-61-3350-8 (print)
ISSNL: 1798-5749 ISSN: 1798-5749
ISBN: 978-952-61-3351-5 (PDF) ISSN: 1798-5757 (PDF)
TIIVISTELMÄ
Barentsin eri alueilla louhitaan paraikaa metallimalmeja, ja toimintaa tukevat kaikki Barentsin alueiden jäsenvaltiot: Suomi, Norja, Venäjä ja Ruotsi. Metallikaivokset luovat paikallista ja alueellista vaurautta. Ne ovat siten yhteydessä taloudelliseen ja sosiaaliseen kehittymiseen, mutta kaivoksista myös kiistelevät erilaiset arktisen Euroopan sosiaaliset ryhmät. Kyseinen teollisuudenala on vastuussa monista herkkään arktiseen ekosysteemiin kohdistuvista vaikutuksista. Siksi Barentsin alueen kaivosteollisuus kohtaa merkittävän kestävyyshaasteen. Keskusteluun nousevat kysymykset, miten käsitellä yhtiön yhteiskuntavastuuta (Corporate Social Responsibility, CSR) ja mitä sosiaalisia ja ekologisia vastuita pitäisi yhtiöiden hyväksyä kannettavakseen. On kiinnostavaa tarkastella sitä, miten teollisuuden toimijat ymmärtävät yleensä yrityksen yhteiskuntavastuu -käsitteen ja mihin toimiin se yrityksissä johtaa.
Väitöskirjani sisältää kolme avainteemaa, jotka ilmentävät Barentsin alueen kaivosyritysten yhteiskuntavastuusta käytävää keskustelua. Analyysi paljastaa toimijoiden kannustimet, joilla yrityksen yhteiskuntavastuun strategia ja politiikka jalkautuvat käyttöön. Tarkastelen niin merkityksellisimpiä kaivosteollisuuden kestävyyden ja sosiaalisen vastuun vaatimuksia kuin metallimalmia louhivien yritysten laajaa sidosryhmien joukkoa. Ymmärtääksemme yrityksen yhteiskuntavastuumotivaatiota, sidosryhmien verkostoa ja soveltuvia kestävyys- ja yhteiskuntavastuustandardeja olen haastatellut Barentsin kaikkien neljän jäsenvaltion kaivosyhtiöiden edustajia, kansalaisjärjestöjä ja geologisten tutkimuskeskusten kaivosasiantuntijoita.
Tutkimuksessani haastattelujen analysoinnissa ja kirjallisuuskatsauksessa hyödynnetään laadullisen tutkimuksen metodeja – pääasiallisesti tilanneanalyysi- menetelmää, johon kuuluu analyyttisiä tekniikoita ankkuroidusta teoriasta
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(grounded theory). Metallimalmikaivosteollisuus ja sen sidosryhmät voivat hyötyä suuresti yhteiskuntavastuu-käsitteestä (CSR). Tutkimukseni osoittaa, kuinka yritys voi yhteiskuntavastuuseen kuuluvia toimenpiteitä toteuttamalla saavuttaa sekä taloudellisia että ei-taloudellisia etuja. Kaivosteollisuuden toimijoita ei voi sovittaa yhteen muottiin, sillä erilaiset ryhmät vaativat ja odottavat kaivostoiminnalta erilaisia asioita. Tutkimukseni kuitenkin todistaa sen, että kaivostoiminnan CSR- käytännöt voivat tuottaa positiivisia vaikutuksia lähes kaikille siihen liittyville sidosryhmille sekä teollisuudenalan sisällä että sen ulkopuolella. Kestävyys- ja yhteiskuntavastuustandardit voivat toimia hyödyllisinä työkaluina yhteiskuntavastuun jalkauttamisessa kaivosyhtiön kaikille tasoille. Nykyään standardien valintaan on saatavilla lukemattomia viitekehyksiä ja ohjeistuksia. Kun niiden joukosta valitsee käyttöönsä standardeja, tulee huomioida, mitä vaatimuksia noudattamalla jatkuu ekologisesta, sosiaalisesta ja taloudellisesta näkökulmasta optimaalinen kehitys.
Avainsanat: yhteiskuntavastuu, Barentsin alue, sidosryhmien verkostoa, metallimalmikaivosteollisuus, arktinen ekosysteemi
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ACKNOWLEDGEMENTS
I would first like to extend my gratitude to my two supervisors Environmental Policy Professor Rauno Sairinen, from the LYY-Institute, at the University of Eastern Finland and Professor Monica Tennberg, from the Arctic Centre, at the University of Lapland, who supported me over the past years with copious quantities of meaningful advice. They were always helpful guiding me towards small facts or supporting me and helping me to keep on track with fundamental issues such as methodology and research analysis. Rauno Sairinen, who has a great deal of expertise with respect to the social sciences in mining, was pivotal in getting many facts regarding extractive industries right in this work. He has an eye for significant details and knew when a research element needed to be opened up or when it played just a minor role. Monica Tennberg encouraged me after finishing my master’s degree to do my PhD and focus on the topic of CSR in an Arctic context. She helped me very often to move towards sensible solutions, when I tended to overcomplicate things. Her profound knowledge in terms of sustainable development, political economy, societal aspects in the Arctic and research methodologies were essential to focus on aspects that mattered most in the work.
I would also like to thank numerous colleagues and friends inside the research community. These include the members of the Northern Political Economy Research Group in the Arctic Centre and several other Arctic Centre colleagues and researchers from the faculties of the University of Lapland. I am grateful to the support from many members of the LYY-Institute (Natural, Resources, Environment and Society) at the University of Eastern Finland. They all gave me valuable comments over the years at conferences, workshops, symposiums, seminars, lectures and not to forget during coffee breaks. In this respect special thanks go to: Riitta Aikio, Maria Åkerman, Ayonghe Akonwi, Eerika Albrecht, Giuseppe Amatulli, Dawid Bunikowski, Marcin Dymet, Mariana Galvão Lyra', Laura Hämäläinen, Assi Harkoma, Kamrul Hossain, Paula Inkeroinen, Tanja Joona, Francis Joy, Tuija Katermaa, Arto Kiurujoki, Timo Koivurova, Juha Kotilainen, Marjo-Riitta Laukkanen, Pertti Leinonen, Hanna-Kaisa Lempinen, Marjo Lindroth, Markus Mättö, Ilona Mettiäinen, Tuija Mononen, Irmeli Mustalahti, Riikka Myllys, Ilari Nikula, Susanna Pääkköla, Susanna Pirnes, Ismo Pölönen, Germán Andrés Quimbayo Ruiz, Anne Raja-Hanhela, Sabaheta Ramcilovic-Suominen, Sari Rissanen, Simo Rontti, Martti Ruokolainen, Mirva Salminen, Olga Sidorenko, Jukka Sihvonen, Heidi Sinevaara-Niskanen, Florian Stammler, Anna Stammler- Gossmann, Hannah Strauss-Mazzullo, Leena Suopajärvi, Heidi Tiainen, Jukka Tikkanen, Paula Tulppo, Kari Viertola, Maria Venäläinen and Joonas Vola. I would also like to extend further special thanks to Arto Vitikka from the Arctic Centre, who created two Barents region maps that visualise the locations of the metal mining case studies.
13 I want also to express my deep gratitude to the Kone Foundation (Koneen Säätiö), which funded my studies for four years. I am grateful that they considered my research proposals as relevant and timely and supported the work in consecutive years.
Finally, I would like to acknowledge my family and friends who always stood and still stand by my side!
Rovaniemi, February 2020 Adrian Braun
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CONTENTS/SISÄLLYS
ABSTRACT ... 7
TIIVISTELMÄ ... 9
ACKNOWLEDGEMENTS ... 12
1 INTRODUCTION ... 21
2 RESEARCH TASK ... 26
2.1 Research questions and objectives of the study ... 26
2.2 Research focus on the Barents region mining sector ... 27
3 RESEARCH METHODOLOGY ... 35
4 THE BARENTS REGION – A VIVID PLACE IN THE ARCTIC ... 54
4.1 Four unique territories ... 55
4.2 The largest ethnic diversity in the Arctic... 58
4.3 Barents region business hub ... 59
5 CORPORATE SOCIAL RESPONSIBILITY (CSR) ... 66
5.1 Twenty years on the rise and still rising ... 66
5.2 A long history that feels short ... 67
5.3 Conceptual consensus in academia and business ... 71
5.4 Not just a business concept but a scientific field as well ... 72
5.5 A mature sibling in a large family of concepts ... 80
5.6 A jungle of standards, frameworks and guidelines ... 95
6 THE METAL MINING INDUSTRY – A GLOBAL BUSINESS ... 108
6.1 Sustainable development, sustainability, CSR and mining – an industry facing multidimensional challenges ... 110
6.2 Barents region mining – the backbone of regional economies ... 118
6.3 Impact assessments in mining – understanding the effects of mining on the natural environment and local society ... 121
7 CASE STUDIES – MINING PROJECTS IN THE BARENTS REGION AND THEIR AFFILIATED COMPANIES ... 126
7.1 Nordic Mining ASA ... 128
7.2 Rana Gruber AS ... 128
7.3 Boliden AS ... 129
7.4 Botnia Exploration ... 130
7.5 Agnico Eagle Finland ... 130
7.6 Sotkamo Silver ... 131
7.7 Kola MMC JSC – Nornickel ... 132
7.8 AO Karelsky Okatysh (PAO Severstal) ... 133
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8 GEOLOGICAL SURVEY ORGANISATIONS AND NGOS – VALUABLE
SOURCES TO LEARN ABOUT NON-FINANCIAL PERFORMANCE IN
MINING ... 134
8.1 Geological survey organisation participants in the study ... 134
8.2 NGO contributions to the study ... 136
9 METAL MINING – KEY ISSUES IN THE BARENTS REGION ... 141
9.1 A myriad of economic, societal and ecological impacts in Barents region mining ... 141
9.2 The concept of CSR in Barents region mining – going beyond shareholder value ... 156
9.3 Implementation of CSR – no movement without incentive ... 183
9.4 The relevance of CSR standards – quality outweighs quantity ... 190
9.5 Stakeholders in mining – visible and hidden; noisy and silent; close and remote; obvious and forgotten ... 204
9.6 CSR in Barents region mining – a path to a brighter future? ... 238
10RESULTS OF THE STUDY ... 248
10.1 CSR in Barents region mining – relevant as a concept, even more relevant as an implementation tool ... 248
10.2 Incentives – pressure, philanthropic thinking, and cost-cutting ... 255
10.3 Stakeholders – hard to achieve and maintain SLO without dialogue .... 257
10.4 CSR/Sustainability standards – indeed a jungle but worth exploring the path through it ... 260
11CONCLUSION ... 263
SOURCES ... 268
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LIST OF TABLES
Table 1. Research questions of the study: CSR in the Barents region
mining sector. ... 26
Table 2. Research objectives of the study: CSR in the Barents region mining sector. ... 27
Table 3. Case study companies, geological survey organisations and NGOs. ... 43
Table 4. Questionnaire Structure – topical categories. ... 50
Table 5. Barents region population (2015). ... 59
Table 6. CSR categorisations based on the concepts of A. B. Carroll, M. Clarkson & A. Rasche. ... 73
Table 7. CSR typology summary of Max Clarkson – four categories of firms (1995). ... 77
Table 8. Elements and characteristics of corporate governance I (CG I). ... 87
Table 9. Key elements of corporate governance II (CG II). ... 88
Table 10. Ten principles of the UN Global Compact. ... 99
Table 11. Phases of ISO 14001. ... 105
Table 12. Fraser Institute – Annual Survey of Mining Companies: 2017. ... 120
Table 13. Fraser Institute – Annual Survey of Mining Companies: 2017. ... 121
Table 14. Case study mining companies and their internal integration levels of CSR. ... 167
Table 15. Stakeholder nominations of all interviewees (companies, NGOs and geological survey organisations). ... 205
Table 16. Stakeholder nominations by company representatives of the Arctic mining industry. ... 206
Table 17. Stakeholder nominations by representatives of NGOs and geological survey organisations. ... 207
Table 18. Stakeholder nominations summary. ... 208
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LIST OF FIGURES
Figure 1. Grounded theory process. ... 37
Figure 2. Situational analysis process. ... 39
Figure 3. Relationships of the mining industry to NGOs and geological survey organisations. ... 42
Figure 4. Situational map – an example. ... 47
Figure 5. Early research stage situational map – an example. ... 49
Figure 6. Member countries and counties of the Barents Euro-Arctic Council. ... 56
Figure 7. Priority areas for the development of the Barents region 2014– 2018. ... 58
Figure 8. Mandatory legal frameworks and voluntary CSR practices – action timeline. ... 72
Figure 9. Pyramid-Model (CSR). ... 74
Figure 10. Global standards – mechanism and dimension of sustainability – inspired by findings of Rasche 2009. ... 79
Figure 11. CSP, CFP and corporate reputation – mutual interdependencies. ... 84
Figure 12. Internal and external stakeholders of companies based on the stakeholder theory. ... 90
Figure 13. Classification of Stakeholders. ... 91
Figure 14. Classification of stakeholders: a salience model. ... 93
Figure 15. Relationship between companies and their (potential) investors. ... 95
Figure 16. Categories and aspects of the Global Reporting Initiative G4 guidelines. ... 97
Figure 17. The life cycle of a mine – processes and corporate decision paths. ... 109
Figure 18. Mine locations of the mining case studies in the Barents region. ... 127
Figure 19. Case-study companies of the study. ... 140
Figure 20. NGOs and geological survey organisations – Affiliates from expert interviewees. ... 140
Figure 21. Why does the global community need metals and mining? ... 144
Figure 22. Five-year-price-development (2012–2016) of gold (US-Dollars). ... 146
Figure 23. Five-year-price-development (2012–2016) of silver (US- Dollars). ... 146
Figure 24. Five-year-price-development (2012–2016) of nickel (US- Dollars). ... 146
Figure 25. Five-year-price-development (2012–2016) of copper (US- Dollars). ... 146
Figure 26. Five-year-price-development (2012–2016) of iron ore (US- Dollars). ... 146
Figure 27. The relevance of CSR in the Barents region mining sector. ... 157
Figure 28. Internal CSR development approaches inside the Barents region mining case studies. ... 166
Figure 29. CSR publication channels of the mining industry. ... 169
Figure 30. Sources for learning about CSR. ... 173
Figure 31. Critical aspects towards the concept of CSR in the Barents region mining industry. ... 179
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Figure 32. Summary of responsibilities of the Barents region mining
industry. ... 183
Figure 33. Incentives for the mining industry to implement CSR into the corporate strategy. ... 190
Figure 34. Nornickel – internal, national and international standards and frameworks of a CSR strategy. ... 193
Figure 35. Application concerns regarding CSR standards of Barents region mining companies. ... 196
Figure 36. CSR/sustainability standards and frameworks. ... 200
Figure 37. CSR/sustainability standards and frameworks. ... 200
Figure 38. Corporate costs of CSR initiatives in the mining industry. ... 203
Figure 39. Stakeholder groups of the Arctic mining industry – company representatives’ perceptions. ... 211
Figure 40. Stakeholder groups of the Arctic mining industry, perceptions of interviewees from NGOs and geological survey organisations. ... 212
Figure 41. Mining companies in the Barents region and the two spheres of internal/external stakeholders. ... 215
Figure 42. Mining Companies in the Barents region and the two spheres of primary/secondary stakeholders. ... 216
Figure 43. Issues with relevance to the relationship of the mining industry and local communities. ... 221
Figure 44. Human and non-human actors that could cause conflicts with Barents region mining. ... 229
Figure 45. Crucial elements for mining corporations to achieve a social license to operate (SLO). ... 232
Figure 46. Opportunities for Arctic mining enterprises by developing/implementing new technologies. ... 244
Figure 47. Planned future CSR activities in the Arctic mining industry. ... 247
Figure 48. Situational map: the Arctic mining industry and its stakeholder relations in the framework of hard/soft-law. ... 265
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LIST OF ABBREVIATIONS
AA “AccountAbility”
AB Aktiebolag (Swedish: Joint-stock company)
AO Akzionernoe Obshestvo (Russian: Joint-stock company) AS Aksjeselskap (Norwegian: stock-based company)
ASA Allmennaksjeselskap (Norwegian: public limited company) CC Corporate citizenship
CEO Chief executive officer CFO Chief financial officer
CERES Coalition for Environmentally Responsible Economies COP Communication on progress
CSP Corporate social performance CSR Corporate social responsibility DJSI Dow Jones Sustainability Index EIA Environmental Impact Assessment EMAS Eco-Management and Audit Scheme EMS Environmental management system e.g. for example
ESG Environmental, social and governance et al. et alii
EU European Union
Exp. Exploration FIFO Fly-in-fly-out
GR Government relations GRI Global Reporting Initiative
GSCI Global Sustainable Competitiveness Index GTK Geological Survey of Finland
HR Human resources
HSE Health, safety and environment ILO International Labour Organization IR Investor relations
ISEA Institute for Social and Ethical “AccountAbility”
ISO International Organization for Standardization
iss. issue
MMC Mining and Metallurgical Company NCP National contact points
NGO Non-governmental organization NGU Geological Survey of Norway
No. Number
OECD Organisation for Economic Co-operation and Development OJSC Open joint stock corporation
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Oy Osakeyhtiö (Finnish: joint-stock company) PR Public relations
ref. Reference
RSPP Russian Union of Industrialists and Entrepreneurs q.v. quod vide
SA Social accountability
SAI Social Accountability International
SASB Sustainability Accounting Standards Board (Russia) SCM State Company Mineral
SIA Social impact assessment SGU Geological Survey of Sweden SLO Social license to operate
SRI Socially responsible investment TSM Towards sustainable mining UK United Kingdom
UN United Nations
UNEP United Nations Environment Programme UNGC United Nations Global Compact
UNO United Nations Organization USA United States of America
Vol. Volume
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1 INTRODUCTION
The early years of the twenty-first century have brought a myriad of transition processes to the global business community, embracing what is required in modern businesses. Discourses on topics such as sustainable development, the growing importance of the service sector and the essential impact of technological progress and digitalisation today determine the every-day activities in corporations. The role of stakeholders is more crucial to business actors than ever before (Freeman 1984/2004; Clarkson 1995; Husted et al. 2017; Hillman & Keim 2001; Mitchell et al.
1997; Mutti et al. 2012; Oestman 2011). Stakeholders are individuals or groups who have certain claims, demands and expectations towards businesses. Corporate actors and their stakeholders mutually influence each other (Freeman 1984; 2004).
Typical expectations from stakeholder groups towards businesses range from benefit sharing, to social equity, environmental management practices, fair working conditions, making a contribution to local and regional wealth and commitments towards global megatrends, such as, climate change and urbanisation (Hodge 2014). In short, today’s stakeholders demand that the business community address their corporate social responsibility and go beyond “mere” legal compliance (Falck
& Spangenberg 2014; Hermanus 2007; Clifford 2009; Carroll 1991; Matten et al.
2003; Tilt 2009).
The European Arctic and its markets are in a unique position in the global economy in the light of all its related markets and sectors. The region is considered remote from the major markets of the United States, the European Union, China and Japan, yet the European Arctic is playing an increasing role in the global economy (Elenius et al. 2015). Infrastructural development, the impacts of climate change and the debate on real and perceived resource scarcities have allowed several business sectors to grow in the past two decades in the most northern territories of Europe (Suutarinen 2014). One of these sectors with a long tradition of operations in the Barents region is the mining industry, with projects under way in Sweden and Russia that have already lasted many decades and multiple new projects in the Finnish and Norwegian Arctic (Kokko et al. 2014). Deposits of iron, nickel, copper, gold, silver and other metals had been explored and considered as worth exploiting (q.v. Norsk Bergindustri, Svemin, FinnMin (mining associations)).
Multinational companies and governments in the Barents region largely follow similar paths and have encouraged and promoted the development of mining in the Barents region (Albareda et al. 2008). However, mining is linked to numerous ecological and social challenges (Hodge 2014; Kokko et al. 2014). From the viewpoint of the natural environment, mining requires land-use, infrastructural development, as well as the construction of facilities, usage of heavy machinery, in addition to the input of chemicals and fuel and human labour (Marsden & House 2006; Prno & Slocombe 2012). These characteristics lead to emissions of greenhouse
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gases and waste in water bodies, soil and air and simultaneously the occurrence of dust and noise (Mutti et al. 2012). Emissions and workplaces underground and/or linked to heavy machinery carry enormous risks in terms of health and safety for personnel, as well as to local communities (Kumar 2010; Tuusjärvi 2013). The crucial impacts of mining compared to other sectors are naturally enhanced by the fact that mining companies are not free to choose the location of a mine as the explored deposit “dictates” where the extraction must be done with the only alternative not to mine the specific deposit at all (Wood 1991; Suopajärvi et al.
2017). In comparison, car-manufacturing facilities or furniture factories, for example, can operate at locations where the ecological and social impacts are low.
This liberty is not given to the mining industry to the same extent.
While in the past centuries, mining operations aimed solely to extract valuable metals or minerals from the rock under the most cost-efficient conditions, a paradigm shift has taken place in global society by also demanding companies to act socially responsibly (McDonald & Young 2012; Prno & Slocombe 2012). Profit maximisation and cost minimisation can no longer be the only parameters of business strategies. Non-financial factors, for example, the ecological footprint, material consumption, working conditions, and social governance have entered the landscapes of the global mining industry (Dashwood 2014; Vanclay et al. 2015;
McDonald & Young 2012; Franks 2012; Prno & Slocombe 2012; Knobblock 2013), and regardless of its remoteness, the Barents Arctic region is not an exception in this respect (Suopajärvi 2013; Kokko et al. 2014; Wilson 2017; Morozova & Britvin 2013).
References to the Arctic in change, or the Arctic in danger or transition, or Arctic opportunities are frequently used in the global discourse, depending on the context, to outline the risks and opportunities that arise with global trends and business development schemes (Roderfeld et al. 2006). The convergence of industry, nature and people in the Arctic environment requires mutual respect and consideration of social responsibilities of all human actors involved. Mining in the Arctic territories requires a corporate understanding of CSR and sustainable development (Wassmer et al. 2014; Crotty & Rodgers 2012). For example, infrastructural and logistical challenges occur due to long distances between mining sites in the European North and the main metal markets in Central Europe. These challenges are linked to other repercussions for the natural environment and Arctic communities (Morozova &
Britvin 2013; Tatarkin & Loginov 2015; Suopajärvi 2013; Kokko et al. 2014; Wilson 2017).
Many actors from industry as well as from critical parties share an opinion that can be simplified and phrased as, “Mining is important for global society, needs to be done, but it has to be done smart,” (Kirsch 2014; McDonald & Young 2012).
These few words sum up a wide range of the discourse which is an element of this dissertation, even though it cannot include all the actors involved and it raises plenty of questions which this study is seeking to answer from several perspectives.
23 One of those questions is, for example, why does society need metals (ERT – European Round Table of Industrialists 2013)? Another one that sticks out is: what does smart mean in this context, smart for whom or what? These questions can be tackled from different angles and backgrounds and might be answered differently by various interest groups. However, these questions lead to the concept of CSR and sustainable development and the conceptual distinction between weak and strong sustainability (Hodge 2014; World Business Council for Sustainable Development 2000). The concepts of sustainability and sustainable development are strongly intertwined but they are by no means the same or interchangeable notions.
Simplified, sustainability could be regarded as the stricter concept of the two. Being sustainable requires that everything is already in balance and shape. If the consumption of a resource is managed sustainably today, future generations will be guaranteed the same access to the resource as they are currently. A local forest area is a suitable example and leads us to environmental economics and more specifically to natural resource economics (Stern 1997; Hartwick 1978; Amezaga et al. 2011). If the wood stock in a local forest is grown sustainably over a long time- span, despite continuous harvesting and utilisation of timber, with good forestry management, the local population will be able to harvest the same amounts of wood as they do today in the future. Timber is a renewable resource and thus sustainable management is definitely feasible by applying good forestry economics tools. With non-renewable resources, such as metals, minerals, oil and gas, sustainability management is more complex and more controversial.
Sustainable development, in contrast to sustainability, rather describes the path to becoming more sustainable over a certain time-span which is possibly predefined. The UN World Commission on Environment and Development defined sustainable development as follows: “Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs,” (Our common Future – UN World Commission on Environment and Development 1987). Companies, states and organisations who strive for sustainable development do not need to turn everything upside-down at once in their policies, practices and processes. In practice they should rather implement a continual improvement process that allows running the system largely as usual for quite some time. Hence being in line with sustainable development could mean there is a long way to go before actually being sustainable (Williams et al. 2017). With reference to the natural resource economics example above, a current analysis could indicate that the overall wood stock is shrinking in a local forest area, and as a consequence local decision makers could aim to follow the path of sustainable development and adapt their management accordingly. However, instead of following the tough calculation to harvest only the calculated limit that would allow the wood stock to grow from today onwards, with sustainable development it is common practice to aim for a wood stock to decline at a slower pace than before (Amacher et al. 2009).
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This study aims to analyse and depict a situational picture of the developments and activities of the mining in the Barents region and to what extent Corporate Social Responsibility (CSR) is evident inside the strategic frameworks of the mining companies in the Barents region. The study examines the ecological, social and economic challenges of Barents region mining, and from this derives specific needs that companies should address to follow the path of sustainable development (Robin 2008; Kokko et al. 2014; Morozova & Britvin 2013). In this context, the research study focuses on three key elements in terms of CSR and the mining industry. It is important to learn what incentives mining companies have to implement CSR practices in their operations, regardless of their size or project stage (Carroll & Buchholtz 2003). Internal factors such as benefit creation but also external pressures can play a role in this respect. A second key element is the stakeholder communication between the Barents region mining industry and actors outside the industry that may be impacted by the industry or who could possibly impact the industry themselves (Sairinen et al. 2017; Marzano et al. 2017; Suopajärvi 2013; Kokko et al. 2014). Who the stakeholders are in mining in the Barents region, what role they have and what the mining companies need to consider in terms of CSR are essential elements in this particular research segment. The third key segment of the Barents region mining, and CSR discourse is the application of international CSR/sustainability standards and the willingness of industrial actors to implement guidelines and principles in their daily operations to continually improve their CSR performance (Kirton & Trebilcock 2014; Gustavson 2009; Matten et al. 2003; Tilt 2009).
To find answers to these research elements and to embed them into the overall framework of CSR, several typologies and related concepts are introduced in this study. The dissertation highlights the significance of concepts, such as corporate citizenship, sustainable development and corporate social responsiveness. Reliable data has been gathered, for example, by the “OECD” (Organisation for Economic Co-operation and Development), the “World Business Council for Sustainable Development”, Coalition for Environmentally Responsible Economies (CERES), World Bank and the “Institute for Social and Ethical AccountAbility”. To consider the participation of these organisations in the CSR discourse it is useful to be able to depict a comprehensive picture of all the actors within the discourse. Furthermore, a general characterisation of CSR strategies is part of the background. In the analysis part of this study, the specific organisational CSR approaches are subjects in the framework of the mining case studies examined. Furthermore, the terms transparency, trust, and stakeholder dialogue are embedded in the context of social responsibility in Arctic mining (McDonald & Young 2012; Kokko et al. 2014). Eight Barents region mining projects have been chosen as case studies to showcase CSR in practice in the European Arctic. Interviews with case study representatives have been conducted to learn more about their individual approaches and the overall relevance of CSR in the region. To widen the perspective and to gain more practical
25 insights, professional mining experts from NGOs and geological surveys were interviewed. The analysis of secondary literature, semi-structured interview results and further materials aims to clarify to what extent CSR is of relevance in the Barents region mining discourse.
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2 RESEARCH TASK
In this chapter the overall goal of the study is outlined by presenting the questions and the objectives of the study. This study provides an analysis of the relevance of Corporate Social Responsibility (CSR) for the metal mining industry inside the four Barents region territories Norway, Sweden, Finland and the Northwest of Russia.
The research focus is on three CSR elements: CSR incentives, corporate stakeholders and CSR/sustainability standards. These areas have been chosen as essential aspects of the study and their relevance will be elaborated in the following chapters, particularly in Chapter 2.2. that outlines the research focus on the Barents region mining sector.
2.1 RESEARCH QUESTIONS AND OBJECTIVES OF THE STUDY
Connecting three ongoing discourses (CSR, mining, and sustainable development in the Barents region) raises questions of how these elements are linked to each other and what the current situation is. This chapter highlights the questions that are paramount to building the research objectives that guide this study. CSR is a concept and strategic tool which can be used to implement sustainable business practices in operations. Interviews with corporate representatives of the mining industry and mining experts from geological surveys and NGOs reveal information on how CSR in today’s Barents region is utilised and accepted. A follow-up question that arises is the cause for the desire to implement CSR. Do financial concerns play a role, or is it rather a non-monetary incentive based on philanthropic ideas, societal pressure, or the need for ecological preservation? The overall questions are outlined below (q.v. Table 1), and the main components of the research task are elaborated in Chapter 2.2.
Table 1. Research questions of the study: CSR in the Barents region mining sector.
# Questions of the study
I. As a concept and strategic tool, to what extent is CSR already an element of the Barents region mining sector? Has CSR as a concept prevailed within the business community?
II. Do mining companies decide to add CSR to their corporate strategy for a specific reason?
Which monetary and non-monetary business assets play a role in practicing CSR in Barents region mining?
III. Do companies neglect (some) stakeholder groups in the current situation?
IV. To what extent do accounting, policy and auditing standards prevail? Which sustainabil- ity/CSR standards do not find consent?
27 The following objectives (q.v. Table 2) are essential to achieve the overall goal of depicting the situation concerning CSR practices, as well as their acceptance and relevance within the mining sector that is operating in the Barents region. The first objective is characterised by a generalised framework to enlighten the thematic area of the CSR concept, to show related approaches, and to present an overview of the Barents region mining sector. The final three objectives are practice-oriented to clarify real CSR mining business situations in the Barents region.
Table 2. Research objectives of the study: CSR in the Barents region mining sector.
# Objectives of the study
I. To determine the state of the art of the CSR discourse, including its characteristics and relevant actors.
II. To identify the incentives (drivers, motivations) of metal mining companies in the Barents region to implement CSR policies and strategies.
III. To collect primary and secondary stakeholder groups in the framework of CSR practices and strategies from the viewpoint of a mining company!
IV. To identify sustainability/CSR standards that are relevant in the Barents region mining industry. To describe standards that prevail and standards that do not find consent.
2.2 RESEARCH FOCUS ON THE BARENTS REGION MINING SECTOR
The research topic involving corporate social responsibility in the Barents region mining sector was chosen due to its frequent and ongoing relevance in multiple discourses. The idea is to highlight the current situation of mining in the Arctic and Sub-Arctic territories of Finland, Norway, Sweden and Russia, predominantly focusing on non-financial issues. The mining industry is traditionally linked to strong ecological and social challenges and problems all over the globe. By considering mining in the Barents region, it is important to consider what the specific challenges and problems are and whether there is a need for actions to be taken by regional mining companies, in other words whether companies have a social and environmental responsibility. Consequently, if the regional mining industry faces these responsibilities, the study looks at how they can accept and manage these responsibilities. In this regard, three core focus areas have been chosen to embrace the CSR discourse in Arctic mining. These focus areas comprise the corporate incentives to implement CSR, the stakeholder universe of the mining industry and the wide spectrum of national and international CSR and
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sustainability standards. How and why these focus areas are appropriate for depicting the relevance of CSR in Barents region mining is outlined in the following section below.
Incentives
Several driving forces have enabled the emergence of CSR since the early 2000s (Okoye 2009; Dahlsrud 2008). These forces are often linked to the motivations of diverse actors within the CSR discourse to promote, support or implement CSR activities, resulting in an increasing number of CSR strategies and concepts within companies. The motivations can be different from company to company and are often linked to a company’s reputation and position in society. As CSR is largely based on voluntariness and requires the commitment of companies to considering their environmental and social performance equally with thier financial performance, individual CSR strategies can be very different (Steurer 2009).
Furthermore, the needs and framework conditions that require consideration of negative ecological and social impacts linked to business operations are different from sector to sector and from one company to another. The managerial decision to widen companies’ perspectives by enlarging the efforts towards environmental preservation and improving societal benefits is often based on three main components. These three components were highlighted in previous research that has concluded that companies’ motivation for promoting CSR initiatives is based first and foremost on the expectations and pressure of stakeholders (including shareholders), secondly on legal frameworks (laws) and thirdly on the ability to increase profits by practising CSR (Matten & Moon 2008; Fabrizi et al. 2014). In most developed countries, established laws to protect the natural environment and society as a whole are strongly elaborated. Already in the early 1980s, environmental policies across Europe saw a regulatory reform within businesses, meaning that new policy instruments, including the implementation and application of voluntary approaches to protect the natural environment (Sairinen 2010). In this respect a paradigm shift had taken place towards the rising significance of corporate environmental governance. Compliance with existing hard-laws (legally binding laws), could already involve numerous requirements for companies to invest a great deal of resources (e.g. capital, human resources) in achieving compliance. With the law, incentives for compliance are naturally to avoid sanctions or penalties in national or international jurisdictions. Moreover, as laws might not in all cases be sufficiently enforced, it is beneficial to meet the legal requirements to legitimise business activities (Palazzo and Scherer 2006) and avoid scandals or loss of image. Legal compliance can also be the primary pillar in building SLO (Falck & Spangenberg 2014). Crotty & Rodgers (2012) interviewed decision-makers of Russian companies and received among other responses from
29 the company management representatives that law is “the base” and there is no alternative but to obey it. In enforcing the law, state authorities can send external auditors to company facilities and carefully check emissions, working conditions, working procedures and health and safety frameworks, overall scrutinising whether the operations are in alliance with law (Hermanus 2007; Clifford 2009). In several countries, companies have complained that these external audits seek malpractices to gain penalty fees, but they do not cooperate to improve the processes or help to make things better in the future. Another problem can be corruption if external auditors take bribes and report that an operation is acting responsibly from a legal perspective, even though, in fact, this might not be the case.
Complying with stakeholder expectations is essential by following guidelines and principles to improve CSR performance (Wheeler et al. 2003; Oestman 2011).
Consequently, stakeholder pressure is one of the main incentives for companies to take non-financial business practices into account (Carroll & Buchholtz 2003).
The motivational aspect behind implementing CSR in corporate strategy comes from the possibility to achieve better profits or to reduce costs for a company. It can be possible to increase the social capital of a company by putting efforts into CSR (Davis & Franks 2014; OECD Insights: Human Capital 2007). Proponents of CSR practices, for instance environmental activists, often claim that efforts to reduce the ecological footprint will result in cost reductions due to an increase of the overall efficiency in material and energy consumption (Reinhardt et al. 2008). Several studies highlight that this potential for savings is in fact marginal as there is weak evidence that reductions in pollution simultaneously reduce the capital costs of companies (Crotty & Rodgers 2012). It depends on each particular case of a business activity to what extent the level of efficiency can be improved or optimised. Evidently, a company that is not allocating its input materials in an organised manner (lacking efficiency) has a strong potential for making savings that can be addressed in the framework of CSR objectives. However, building social capital by implementing CSR policies and practices could hold a large potential for many companies that could pay off in the end in a monetary sense as well (OECD Insights: Human Capital 2007). For instance, building up relations and cooperation with stakeholder groups can create trust, and from this an improved reputation can follow that will attract further shareholders and investors.
As this study links CSR practices to the mining industry, it is necessary to shine a light on the incentives inside mining corporations to act in a socially responsible manner and to look beyond their own production and services taking ecological, societal and governance issues into account (Gitman 2009). Large-scale mining projects need to attract external investments as the investment required for these kinds of projects is immense in capital amounts and is spread over a long time period. Particularly, at the beginning of a mining project, investment plans are required to cover time spans of several years (often a decade or more) before the
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extraction process can begin and the produced metals can be eventually sold on the markets (q.v. Chapter 6: The metal mining industry – a global business). Reducing the risks associated with social and ecological problems and conflicts holds the potential to create various project benefits (Davis & Franks 2014; Falck and Spangenberg 2014). In many cases mining companies receive criticism from external stakeholders for non-compliance with environmental standards that have been established in the market, or in the country of operations, or within the community (Kemp et al. 2010, Mutti et al. 2012; Kirsch 2014). In the case of a large- scale deterioration of the natural environment, such as waste water spills into water bodies or the soil, or dam breaks with toxic tailings, even large-scale projects can struggle from these ecological disasters if compensation claims and the compromised image impact the corporate operations too strongly. In such cases, the survival of the mining companies themselves might be called into question (Mutti et al. 2012).
Developing and maintaining a satisfied workforce is another benefit that can be improved or achieved through CSR practices. Considering the social needs and expectations of the workers and their families is essential to achieve a positive outcome in the long-term. As mining is traditionally risky in terms of health and safety (Kumar 2010), CSR managers have to develop safety measures to the greatest possible extent at the mine site, possibly implementing and following international standards (Hermanus 2007). The ratio of accidents per working hour is a significant CSR indicator and nowadays stakeholders and investors scrutinise what happens in a project in this regard. Accidents at mining sites are a further factor which can compromise the reputation and attract a lot of stakeholder attention due to the messages put out by the media and other externals (Mutti et al. 2012).
The natural resource markets are traditionally highly competitive and differentiation from competitors is also an aspect that should find consideration in terms of CSR performance. Many firms would rather choose a metal supplier with a good or moderate reputation, instead of a company that is known for its malpractices in the social and ecological sphere. By considering the mining life cycle, there are possibilities for CSR improvements at every periodic stage of mining, as social, environmental and governance impacts occur from exploration to the closing of a mine (Kokko et al. 2014; Suopajärvi 2015).
The Internet is a strong medium that companies use to publish CSR content in relation to their business activities and operations. Additionally, the Internet is a communication channel which a rising number of people across the globe can access, and it is consequently the most relevant platform for companies to highlight and explain their sustainable business practices. In the pre-Internet era print-media, TV and academia had the largest opportunities among stakeholders to address and criticise mining operations. Nowadays, everyone who has access to the Internet has the chance to share their thoughts and worries in the framework of blogs and social networks. Via the Internet, people can also easily join initiatives from NGOs or
31 other organisations to address malpractices in the form of company-stakeholder dialogue (Rockwell 2003; Kirsch 2014).
Stakeholders
To point out the relevance of CSR for the Barents region mining industry, the stakeholders of the sector are a key element. In the framework of this dissertation it is important to clarify the term stakeholder. In this clarification process, it makes sense to separate the word into its constituent parts, “stake” and “holder”. Stake refers to a claim, share or input of something or towards somebody. The word holder indicates that somebody owns or has something. Consequently, a stakeholder owns or has a claim or a share regarding a corporate actor (Freeman 1984; Marzano et al. 2017). This claim may be of a monetary or non-monetary nature, depending on the relationship between the stakeholders and the company.
Stakeholders develop, determine and utter demands and expectations towards industrial actors. Stakeholders can be seen as one overall group outside of the business, but nonetheless they could have claims addressing the mining operations, and moreover with their actions they could influence the developments inside a mining enterprise. However, as the aforementioned claims, demands and expectations could be of a very different nature it is difficult to consider the stakeholders of a company as solely one group. Usually, stakeholder claims are diverse and not all stakeholders speak with one voice. Some stakeholders are concerned about the environment, others about social issues such as health and safety (Prno & Slocombe 2012). Some stakeholders build a strong sense of identification with a company although they do not receive direct benefits from it.
Other stakeholders are affiliated with competing companies or competing sectors and find economic reasons to oppose a company. The diversity is far-reaching and could extend across the boundaries of business, culture, ethnicity, nationality, sustainability and many other characteristics. The mining sector with operations in all four member countries of the Barents region has numerous stakeholders and it is a key element of this study to reveal as many as possible. Some stakeholders are easy to identify, for example workers, employees, customers and in many cases local communities, however, there are also voices in the discourse that are often insufficiently heard. These “forgotten” stakeholders may be environmental activists without a lobby and lacking financial or networking power to gain the attention of larger audiences. Additionally, the power of local communities to influence a mining project can significantly differ from project to project and location to location (Prno & Slocombe 2012; Franks 2012). This is not just evident in a global context, but also in the regional perspective of the Barents region (Suopajärvi et al 2017). While the communities in the remote areas of Finland, Norway and Sweden live in circumstances with an already developed infrastructure and access to
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telecommunications to interact with other stakeholders and the industry, many local communities, including several indigenous groups in Northwest Russia, still live a rather isolated way from other ethnic groups (Ivanov 2015). For them it is more difficult to receive attention regarding their concerns about the extractive industries in their homeland (Tennberg et al. 2014). Lacking communication channels and the fact that the global community often pays less attention to Russia, compared to many other industrialised countries are two major concerns in this regard. Ecological problems in Russia are often addressed by international environmental NGOs on a national scale with a need to enforce federal environmental laws and without looking into local cases in depth (Crotty &
Rodgers 2012). It is also an argument of this dissertation that future generations are largely neglected in the discourse, even though the popular concept of sustainable development clearly emphasises that upcoming generations must not be compromised by today’s consumption, production and exploitation of natural resources (Robin 2008). The future generations have one of the weakest lobbies of all stakeholders as they can self-evidently not raise their voice themselves. This study examines to what extent company experts and non-industry mining experts address the issue of the future of the Arctic in terms of society as well as ecosystems (Wassmer et al. 2014; Crotty & Rodgers 2012).
Standards and Guidelines
CSR guidelines, standards and frameworks have been raised in the past two decades and have evolved immensely to become an important element for those companies who intend to implement strategies and action plans to transfer theoretical CSR approaches into practice (Matten et al. 2003; Tilt 2009). The rapid emergence of numerous standards, the complexities in their entirety and the global acceptance of these standards, from the company and stakeholder perspective, make the focus on sustainability guidelines an essential element of this dissertation.
Therefore, this research work introduces several standards with relevance to environmental, social, economic and governance issues. The work reveals to what extent CSR/sustainability standards are implemented in the Barents region mining industry. The focus of the study is on the viewpoints of the industrial actors and which CSR standards are widely utilised in mining in the Barents region. What is of interest in this study is which standards may be the most beneficial for the mining industry and are appropriate for efficiency improvements regarding the formulated principles and guidelines. It is important to understand by focusing on CSR and sustainability standards that they can differ in scopes, content and applicability largely and not every standard is suitable for plans and processes in every company (Kirton & Trebilcock 2014; Gustavson 2009). One approach is the implementation of policy standards that highlight a specific number of principles regarding
33 sustainability issues. Companies can develop their own CSR policy following the prescribed principles (Rasche 2009). The advantage of policy standards are their simplicity in application, and they provide internal stakeholders of a company with a basic framework that matters in non-financial terms inside the corporate organisational process (Rasche 2009). Criticism towards policy standards is often based on their generalisation of specific CSR challenges and that the formulated CSR policies often lack pathways to create solutions for specific sustainability challenges (Kirsch 2014). Opponents argue that these policies name general actions that companies need to carry out, but directions on how to achieve these targets are insufficient or often entirely missing. In other words a policy describes the “what”
but not the “how”. One example could be a policy target which requires the reduction of carbon dioxide emissions into the atmosphere in all operational processes. This target alone will not lead to any improvement. It is necessary to define a time-frame and the amount the emissions should be reduced in the determined time-frame. Moreover, activities have to be planned and communicated inside corporate units to achieve this goal, for example, concerning the implementation of new technologies, or the usage of alternative materials or reduced production (Dunne 2007).
Another category of CSR standards guide companies through CSR reporting processes and highlight the performance with specific sustainability indicators (Owen & O´Dwyer 2005). These may imply the levels of pollution, the material input of toxic materials, magnitudes of greenhouse gas emissions in production and transport, comparative levels of workforce salaries and wages, community involvement, anti-corruption practices, audit schemes (internally and externally) and compensation plans for negative impacts (McDonald & Young 2012; Vanclay et al. 2015). Standardised reporting tools allow high levels of comparability between companies inside one industry and are also cross-sectoral. In comparison to policy standards, reporting standards allow companies to practice CSR in a more structured way and depict their actual performance more concretely (Rasche 2009;
Owen & O´Dwyer 2005; Bice 2016). In this context, reporting standards are normally more complex in implementation and require larger corporate resources in capital and labour compared to policy standards. Accounting standards are a third category, often providing social frameworks to allow companies to address their responsibilities towards society. The accounting of social accountability can be regarded on global, regional or local scales, depending largely on the operations of a company and its territorial market orientation (Sullivan & O´Dwyer 2015). A final category is auditing, which is most commonly implemented in terms of non- financial auditing through the consideration of environmental management systems. These standards aim at continuous ecological improvements throughout the entire value and supply chain of an industrial actor. The PDCA approach (Plan- Do-Check-Act) is a notable four-phase model that operates in line with environmental management practices to enable companies in an annual cycle to
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minimise aspects such as the amounts of waste and consumption of energy and water to the greatest possible extent (ISO 14001; EMAS III). Auditing standards allow corporate actors to receive external certification after successful audits, and this allows them to reduce reputational risks and to build good relations with stakeholders, customers and investors (Hainmueller & Hiscox 2012; ISO 9001).
It is important to note that it is not always possible to put certain standards into specific categories. A standard could be just a policy standard, but a single standard may also belong simultaneously to the categories of reporting, auditing and accountability. This study seeks to determine which CSR standards of which categories are relevant for the Barents region mining industry, to what extent decision makers and sustainability experts inside the industry are aware of the existence and strengths and weaknesses of available standards, and in the same context what the opinion of non-industry mining experts from NGOs and geological survey organisations are. A variety of CSR standards have been developed to this date and more organisations (governmental, intergovernmental, non-governmental) and associations are developing new standards which aim to cover specific elements that need to be addressed by industry (Albareda et al. 2008).
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3 RESEARCH METHODOLOGY
Multiple disciplines will find the chosen research topic relevant. This is due to several reasons, starting with the fact that multiple discourses are an element of this research, which is already evident just by reading the title of the dissertation. CSR alone embraces multiple disciplines, such as sociology, economics and environmental policy (Dunne 2007; Harwell Wells 2002; Carroll 1999; Husted &
Salazar 2006; Okoye 2009; Scherer & Palazzo 2011). The Barents region is linked to multiple discourses, such as climate change, urbanisation, out-migration, natural resource exploitation and fragile ecosystems. These discourses embrace sociology and environmental policy and connect to the social sciences in the fields of: political science, societal history, human geography, demographics, communication studies, anthropology and public health. Moreover, the mining industry, as the chosen industrial sector in this study, links to management studies, corporate environmental policies and the stakeholder management discourse (Freeman 1984).
Social-scientific research on the mining industry is increasing and has prevailed in the mining research field, where geology and technology studies have been strong for many decades (Vanclay et al. 2015; Bice 2016; Franks 2012; Marsden & House 2006; Suopajärvi 2017). The study is embedded in the methodological frameworks of the social sciences and its diverse “sub-disciplines” as outlined (Kuper & Kuper 1985; Charmaz 2006). The focus is thereupon on qualitative research with the main methodology of situational analysis (Marzano et al. 2017; Latour 2005). Research in social sciences aims largely to enlighten the situation of society and the interrelations between different actor groups within society (Latour 2005; Kuper &
Kuper 1985). Society plays a crucial role in this research. On local scales the research covers social responsibilities of the Barents region mining sector, largely the local and regional levels of the European Arctic territories. Stakeholders from outside the Arctic (e.g. investors, suppliers, customers and activists) are also taken into consideration. Stakeholder is already a key term embracing the issue of societal perspectives on the mining industry. Distinctions can be made between actors inside or outside the industry, for or against the industry, and those who are dependant and independent from the industry and its products (Latour 2005;
Clarke 2003). Hence, the relevance of metals produced by the Barents region mining industry to serve society is a prime topic in this study.
Economics as a sub-field or related field of social sciences (Marzano et al. 2017) is essential in this study and is utilised to analyse the role of mining companies in the Barents region in terms of wealth creation. Production, consumption and distribution of wealth are also points of interest (Keynes 1930). Local communities in the Arctic depend on specific livelihoods and some are complementary to the mining industry (e.g. suppliers) and some might be opposed to mining activities (e.g. hunting, tourism). The study of economics raises issues of management, scarce
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resources and the development of alternatives to established concepts (Keynes 1930). An economist strives naturally to find the optimal solution towards a specific challenge, for instance the optimal distribution of scarce resources (Porter &
Kramer 2006). As a societal actor both in the Arctic and on a global scale, it is important for the mining industry in the Barents region to distribute the resources in the Barents region in a sustainable way. The mined resources (metals) are in this regard only one element. Labour, capital, infrastructure, legislative frameworks and non-mining natural resources (e.g. timber, water, plants and animals) are also important as they all can be impacted by the mining industry (Kokko et al. 2014).
This study follows diverse analytical steps within a largely qualitative research framework. The “situational analysis”, coined by Adele E. Clarke (Professor Emerita of Sociology & Adjunct Professor Emerita of History of Health Sciences, Department of Social and Behavioral Sciences University of California), provides the overall analytical toolkit. This grounded theory approach was developed in 2005, and is based on the prior achievements of Anselm Strauss. Grounded theory is not a single method, it is a set of diverse methodologies. The researcher can decide to apply one or more methodologies to open up the data that needs to be analysed. Grounded theory is applicable for qualitative research and is particularly suitable for transcriptions of interview materials but can be utilised for other forms of text as well. Moreover, it is applicable for diverse sub-disciplines in the field of the social sciences (Clarke 2005). One of the main ideas of Glaser and Strauss (1967), who were the initial conceptualisers of grounded theory, was to connect the researcher’s mind-set with the relevant data. Data is in many cases abundant, abstract and redundant. The tools and work steps of the grounded theory methodology help to filter the relevant data from the irrelevant, the informative from the less important and novelties from the already known. Grounded theory intends to be inductive, meaning it usually starts with a research question. It is even possible that a set of qualitative data is the sole starting point for the research as this is the only thing needed to follow the methodology and build upon “grounded theory” (Strauss & Corbin 1990). The establishment of hypotheses that need to be proven correct or wrong is not an element of grounded theory and contradicts the grounded theory methodology. The following chart depicts the major procedural steps in grounded theory, which were largely applicable in the framework of this dissertation. As a situational analysis is a follow-up methodology to the grounded theory approach (q.v. Figure 1: Grounded theory process – Findings and development by Strauss (1987), Charmaz (2006), Clarke (2005) and Glaser & Strauss (1967). and entails largely similar working steps (Charmaz 2006; Clarke 2005), the grounded theory process is relevant to this dissertation.
37 Figure 1. Grounded theory process.
Clarke (2005) describes a situational analysis as an analytic tool applicable in a wide array of research fields (q.v. Figure 2: Situational analysis process) The analysis process applied in CSR in the Barents region mining sector study is based on the findings and developments of Clarke (2003/2005), Charmaz (2006) and Glaser &
Strauss (1967). Grounded theory and subsequently the situational analysis were developed to gain more analytical and systematic results in qualitative research (Mathar 2008). Clarke carried out situational analyses in thematic areas linked to
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the social sciences (Kuper and Kuper 1985; Mathar 2008), by focusing amongst other things on the topics of health, medicalisation, life sciences and gender studies.
Situational analysis is a methodology which can be used to depict all the relevant actors (Clarke 2005) in the framework of the CSR discourse and to gain knowledge about the interdependencies and power relations of groups and actors that are involved in the discourse. A situational analysis is used as a tool to reveal different positional strengths and weaknesses of diverse actors in the discourse (Latour 2005).
39 Figure 2. Situational analysis process.
The creation of situational maps is an essential part of the analytical methodology to “lay out the major human, nonhuman, discursive, and material elements of the CSR
