Empty promises whitewash Freeport's rights, responsibility record

Special for ETAN 

by David Webster

What does a mining company need to do to get a top score for “corporate social responsibility”?

To judge by the recent “100 Best Corporate Citizens List”, all it takes to finesse a long and controversial record of human rights abuses is to come up with a piece of high-minded rhetoric, then carry on as usual.

Freeport's Grasberg mine, West Papua.

Human rights advocates and those who have studied the record of Freeport McMoran in West Papua were startled to learn that Corporate Responsibility Magazine had named Freeport as the 24^th-best corporate citizen in America (click for the full list). More startling still, the company scored well based mainly on a sixth-place ranking in the human rights category.

How is this possible? Well, the survey’s methodology seems to pay no heed to human rights performance. Only human rights rhetoric matters. And in that, Freeport excels. A strong written policy on human rights declares: “Freeport-McMoRan does not tolerate human rights transgressions.” It points to rights risks in West Papua, Peru, and the Democratic Republic of Congo, and adds that PT Freeport Indonesia policy is to “notify the direct commanders of the perpetrators” in cases where human rights allegations are made against Indonesian security forces. Since reputable human rights groups suggest that the top ranks of the security forces are implicated in widespread human rights violations in West Papua, this is hardly striking at the root of the problem.

As local people have pointed out, and researchers have confirmed, Freeport’s performance is a far cry from the written policies. The main trouble is intimate ties to Indonesian security forces.

Security forces may be implicated in the murder of American citizens near the Freeport mine, as Eben Kirksey and Andreas Harsono have reported.

Violence around the mine is used by security forces to target and scapegoat local people. In 2005, the New York Times revealed that Freeport paid the security forces more than $10 million in 2001 and 2002. Payments are now made “in-kind” rather than in cash. The local Amugme people have long protested Freeport seizure of their lands. Pictures of Freeport’s Grasberg mine from space (left) show the scale and environmental impact in the mountains that are home to the Amungme.

And lest all of this be hailed as “old news,” the Amungme filed a lawsuit last year saying Freeport had taken their lands illegally. Meanwhile, the Indonesian army’s presence around Freeport, and the company’s close ties to Indonesian security forces, were reinforced this year. The continuing alliance between Freeport Indonesia and the Indonesian security forces is likely to exacerbate, rather than improve, the human rights situation.

None of these reports are taken in to account in the “100 Best Corporate Citizens List.” All the human rights indicators measure “human rights disclosure” and the sole source, according to the methodology details, comes from “Company public disclosures” – a corporation’s own information about itself.

The methodology, in other words, measures promises, not performance. There are parallels to the debate over whether companies accused of operating sweatshops overseas can be trusted to police themselves, or should accept independent monitoring. Thus the list cites the voluntary “Sullivan principles” first created under the Reagan administration and welcomed by companies resisting demands to divest from apartheid South Africa. And Freeport boasts of adherence to the Voluntary Principles on Security and Human Rights, launched by the British and American governments in 2000.

Indonesian soldiers and police escort a convey of trucks along a road 

to the mine 

operated by US firm Freeport McMoRan (AFP

The key word here is “voluntary.” As with the mining industry globally and with businesses jumping on the corporate social responsibility (CSR) bandwagon more generally, companies are happy to promise good performance, as long as no one will be looking over their shoulders.

So perhaps it’s no surprise to learn that Corporate Responsibility Magazine is in fact published on behalf of the Corporate Responsibility Officers Association, a body made up of many of the companies being judged, and steered by such firms as Domtar and KPMG. Freeport is listed as a “recent member” of the CROA. It’s advanced in the listings – it was ranked 83^rd in 2010.

The problem here isn’t just the “corporate social responsibility” methodology, but the entire concept of “CSR”. It can all too often be used by companies to buy their way out of “corporate social irresponsibility.”

Freeport is no champion of the best values of corporate citizenship: For human rights activists, it’s long been a poster child for corporate irresponsibility. A list of good corporate citizens with Freeport winning laurels demonstrates more than flaws in the study. As George Monbiot has written of climate change credits, the lists offer corporations a new form of medieval European Catholic “indulgences,” forgiveness for any form of offence. Jeff Ballinger recently pointed out on this blog that companies like Nike are wrapping themselves in the CSR garment to burnish their corporate images, despite continuing disregard for many labour rights. Freeport, too, is now having itself measured for a fine CSR wardrobe.

----

David Webster is an assistant professor of International Studies at the University of Regina in Saskatchewan, Canada. He is a former coordinator with the East Timor Alert Network/Canada. 

see also

West Papua Report (monthly)

ETAN/WPAT: Statement on the operations of the Freeport McMoran Mine in West Papua, to the U.S. Senate hearing on Extracting Natural Resources: Corporate Responsibility and the Rule of Law