Corporate Social Responsibility Challenges in the Extractive Industry: An Introduction

The extractive industry has never been out of the crosshairs of the CSR discussion and controversy. This could be attributable, at the very least in part, to the contentious nature of many mining investments as well as the social and environmental concerns that so frequently appear to follow mining activity. The shutting down of mines and the subsequent loss of economic activity can have disastrous consequences, including the creation of environmental damage, the loss of jobs that can lead to an increase in local unemployment and other related issues, repercussions for the value of the residential property, and an impact on the infrastructure that was initially supplied by the enterprise. Heavy reliance on mining is highly connected with various socioeconomic problems, including extreme poverty, a lack of education, and inadequate medical care. These problems are also substantially correlated with heavy reliance on mining. Repressive regimes, civil wars, insurgencies, corrupt governments, and interethnic violence are all factors that have a negative effect on the operations of businesses. These issues also create obligations and liabilities for global corporations in human rights. Those who operate in the extractive industry should therefore regard the decision to join a nation and engage in commerce with a particular government to be a core worry on their list of concerns. Should multinational businesses conduct business in countries governed by authoritarian governments? Is it reasonable to draw a line between working with governments with human rights records that are merely “tough” and dealing with countries that have been called pariah regimes by the international community? If so, what exactly should that line look like? Therefore, this chapter analyzes corporate social responsibility challenges in the extractive industry.