Author: Dr Cheri Young
Dr Cheri Young is a lecturer in the Department of Private Law, University of Cape Town, and an admitted attorney of the High Court of South Africa. Her interests include energy and natural resources law (particularly water law), property law and theory, and administrative law
The “social license to operate”, in mining, is the important power of communities – and through them society – to frustrate mining operations where legal or social norms are violated by mining companies.[i] Social licence to operate is the latest buzzphrase to dominate the discourse on responsible mining practices, and it joins the ranks of other concepts, such as sustainability, corporate social investment, environmental justice, accountability and transparency.[ii] Mining companies readily tend to acknowledge that communities are important stakeholders in mining operations. But does such recognition translate into tangible benefits for these communities, particularly for the most vulnerable?
Here is an example: Zambia’s Konkola Copper Mines PLC (“KCM”) is one of Africa’s leading producers of copper. KCM is owned by Vedanta Resources PLC, a natural resources multi-national producing “zinc, lead, silver, copper, iron ore, aluminium, power, oil and gas”.[iii] On its website, KCM commits to initiatives aimed at employment generation, support for local business and communities, and the provision of social services.[iv] KCM boasts some impressive corporate social investment (CSI) contributions, totaling US$150million in the past nine years,[v] channelled towards projects including infrastructure, health, education, sport and “sustainable livelihood”.[vi] Amongst others, these initiatives include the development of two schools that educate over 2200 learners, and health initiatives aimed at combatting malaria and kidney disease, the provision of artificial limbs, and HIV/AIDS programmes.[vii]
These CSI contributions strike the appropriate chord: evidencing a consciousness of the impacts of its business on the people of Zambia, KCM promises faithfully to put the Zambian people first, as required. This promissory tone is not unique, nor is it new; mining companies around the world consistently claim an ongoing commitment to the environment, communities and sustainability generally.
Notwithstanding this veneer of wholesome commitment to social upliftment, the inner workings and priorities of KCM were exposed in 2006, when the primary water source of the Chingola people on the Copperbelt Province was polluted with toxic effluent from KCM’s mines. Following the rupture of the Mtimpa tailing pipeline, toxic effluent was released into this water source over a period of 48 hours.[viii] Vast swathes of the local community, dependant on this water source, were struck down by a multitude of different illnesses as a result of this spill.[ix]
Consequently, James Nyasulu, a local poultry farmer, joined by 2000 residents of the Chingola community, sued KCM for damages, and the High Court decided in the favour of Nyasulu and his fellow claimants.[x] During the trial, community members gave evidence that they had suffered from symptoms such as diarrhea and vomiting, that the smell of the water was foul and the taste bitter, that they had noticed dead fish in the river following the incident, and that the colour of the water changed as a result of oxidisation.[xi] KCM defended the matter, arguing inter alia that an event beyond their control - a burst pipe - caused the pollution. The High Court disagreed and ordered KCM to pay the community members ten billion Kwacha (between $US1.5 to 2 million dollars).[xii]
KCM appealed to the Supreme Court of Zambia,[xiii] arguing that the trial court had erred in its conclusion, as it made no finding as to whether KCM owed the community a duty of care, nor whether any such duty was breached.[xiv] In considering this question, the court of appeal evaluated the obligations of the mining company as contained in the legislative framework, as well as the conditions set out in its operating licence.[xv] The Environmental Protection and Pollution Control Act, Chapter 204 of the Laws of Zambia, sets clear parameters in terms of which water pollution must be controlled.[xvi] While mining discharge into water sources is permitted, the extent of the pollutants are strictly set out in the company’s operating licence, awarded in terms of the Water Pollution Control (Effluent and Waste Water) Regulations of 1993.[xvii] The parameters provided in the license stipulated that the ph range had to be between 6 to 9 for suspended and dissolved solids, dissolved sulphates, copper, iron and cobalt.[xviii] Instead, what was found was that the Chingola and Mushishima streams, which feed into the Kafua river, carried highly acidic effluent with a ph balance of 2.9.[xix] A simple fix to this high acidity is to add lime to the water, which KCM had failed to do. The court concluded that a duty of care existed by virtue of the legislative framework and the common law, and the company had clearly breached this duty.[xx]
KCM also appealed the court’s award on the basis that it relied on the medical evidence of only a few claimants, and the law instead required an independent medical report to be submitted for each claimant.[xxi] This argument found favour with the Supreme Court, which concluded that the trial court had erred in awarding damages without the furnishing of medical reports for each of the claimants.[xxii] The appropriate decision was instead to refer the matter to the Deputy Registrar for final assessment of the quantum of damages to be awarded.[xxiii]
The court’s finding in respect of the damages award, while legally sound, evidences the power-imbalance between mining companies and communities. For one thing, evidence was presented to the trial court regarding the community’s difficulty in accessing medical records. In some instances, persons treated by the clinic, itself allegedly funded by KCM, were unable to obtain medical reports, either because they were told that the reports were “company documents”[xxiv] or the medical staff at the clinic feared the repercussions, should they provide this report.[xxv] This is not the first time that Vedanta has been accused of nefarious behavior and intimidation tactics.[xxvi] This is but one kind of factor that insulates the conduct of mining companies. Others include the prohibitive cost of litigation in the first place.
The conduct of KCM has to be questioned. Why would KCM be unwilling to pay $US2 million dollars where a court found that they had poisoned the drinking water and threatened the health of local communities, particularly where the company has spent over $US150 million dollars on voluntary initiatives. Such conduct makes the most laudable CSI efforts and contributions seem to be mere targeted advertising campaigns. KCM’s many initiatives are undermined by the company’s unwillingness to take responsibility for their polluting actions. As stated by the primary claimant, James Nyasulu, “the poison we drank violated our right to life… Citizens of this country cannot be treated as guinea pigs for investors”.[xxvii]
Since the finding of the Supreme Court, a UK-based law firm (Leigh Day) has commenced proceedings in the United Kingdom on behalf of 1800 community members against Vedanta.[xxviii] Still today, there are concerns that the effluent will eventually poison the Zambezi river, which supports tens of thousands of families.[xxix] For the sake of those living closest to these precious water resources, the speedier a resolution is obtained, the better.
[i] L Black The Social Licence to Operate (2013); J Prno Establishing a Social Licence to Operate Amidst Complexity: Issues and Opportunities for Mining Industry Governance (2014).
[ii] Richard Steiner, Professor, Oasis Earth, Anchorage, Alaska Citizens’ Advisory Councils To Enhance Civil Society Oversight Of Resource Industries (UNEP, June 2013, Issue 10) http://www.unep.org/civil-society/Portals/24105/documents/perspectives/E... [accessed on 9.4.2016].
[iii] See Konkola Copper Mine website. Available at http://kcm.co.zm/wp-content/themes/kcm/pdf/Vedanta-Commitment-to-Zambia-... [accessed on 7.4.2016].
[iv] See Konkola Copper Mine website. Available at http://kcm.co.zm/wp-content/themes/kcm/pdf/Vedanta-Commitment-to-Zambia-... [accessed on 7.4.2016].
[v] See Konkola Copper Mine website. Available at http://kcm.co.zm/wp-content/themes/kcm/pdf/Vedanta-Commitment-to-Zambia-... [accessed on 7.4.2016].
[vi] See Konkola Copper Mine website. Available at http://kcm.co.zm/wp-content/themes/kcm/pdf/Corporate_Social_Investments_... [accessed on 7.4.2016].
[viii] Nyasulu and Others v Konkola Copper Mines Plc and Others (2007/HP/1286)  ZMHC 86 (1 January 2011) J8.
[x] Nyasulu and Others v Konkola Copper Mines Plc and Others (2007/HP/1286)  ZMHC 86 (1 January 2011).
[xi] J4 ff. The Guardian ‘I drank the water and ate the fish. We all did. The acid has damaged me permanently’ (1.4.2015). Available at http://www.theguardian.com/global-development/2015/aug/01/zambia-vedanta-pollution-village-copper-mine [accessed on 9.4.2016].
[xii] J22. “Zambia Supreme Court holds Vedanta guilty of water poisoning” (1.4.2015). Available at http://www.foilvedanta.org/uncategorized/call-out-protest-at-zambia-high... [accessed on 7.4.2016]; BBC “’Rivers of acid’ in Zambian Villages (8.9.2015). Available at http://www.bbc.com/news/world-africa-34173746.
[xiii] Konkola Copper Mines PLC v Nyasulu and Other (Appeal No.1/2012)  ZMSC 33 (2 April 2015).
[xv] J8 ff.
[xxiv] J3 – J4.
[xxvi] Hausfield “Nyasulu v. Vedanta plc and Konkola Copper Mines plc”
[xxvii] “Zambia Supreme Court holds Vedanta guilty of water poisoning” (1.4.2015). Available at http://www.foilvedanta.org/uncategorized/call-out-protest-at-zambia-high... [accessed on 7.4.2016].
[xxviii] The Guardian “Zambian villagers take mining giant Vedanta to court in UK over toxic leaks” (1.8.2015)
[xxix] The Guardian “Zambian villagers take mining giant Vedanta to court in UK over toxic leaks” (1.8.2015)
http://www.theguardian.com/global-development/2015/aug/01/vedanta-zambia-copper-mining-toxic-leaks [accessed on 9.4.2016]; The Guardian ‘I drank the water and ate the fish. We all did. The acid has damaged me permanently’ (1.4.2015). Available at http://www.theguardian.com/global-development/2015/aug/01/zambia-vedanta-pollution-village-copper-mine [accessed on 9.4.2016]; A Topf “Mining firm faces pollution allegations in Zambia” (2.8.2015]. Available at http://www.mining.com/uk-mining-firm-faces-pollution-allegations-in-zambia/ [accessed on 9.4.2016].