SarWatch Writer
PRESS RELEASE: First Quantum Minerals Corporate Governance and Social Responsibility: Kansanshi Mine

15 December 2020

The Southern Africa Resource Watch (SARW) has published a second report on Kansanshi Mine in less than two years. The first report, titled “Living in Parallel Universe: FQM versus communities”, was released in February 2019. First Quantum Minerals (FQM) disputed the findings. After disputes, both sides agreed to a second research process, and FQM agreed to avail its management to speak to SARW’s research team. The report’s key objective is to assess the company’s corporate governance and social responsibilities (CSR) programme. It makes recommendations to FQM’s Kansanshi mine, the government of Zambia, and civil society on how to promote a mutually beneficial relationship between FQM’s Kansanshi mine and adjacent communities. A point of agreement (possibly the only one) between FQM and SARW is that whether CSR is legislated or not, corporations have a moral obligation to invest in the welfare of surrounding communities in a way that creates positive and lasting impact.

The research found that FQM’s CSR interventions are neither transformative nor sustainable in the long run. Although FQM has shown signs of progression from a history of poor corporate social responsibility of private mining companies in Zambia, this still falls short of expectations. This is evident through cases of poorly conceived social projects, at times without consulting beneficiaries, and human rights abuses such as the taking away of farming land from Kyafukuma village. The company’s environmental footprint is also significant. The research found that the water from the drain is highly mineralised, and that the smelter continues to release of the Sulphur dioxide emissions despite great efforts by the company to reduce it, contradicting the company’s claim of zero discharge.

The report identifies a number of unresolved misunderstandings and conflicts between communities and the company emanating from several disputes, ranging from displacements and compensation, possible water pollution, and cracked houses because of mining blasts. Furthermore, the report identifies several possible impacts the company’s activities could be having on the health of surrounding communities. Most findings in the report contradict FQM’s belief that it is doing a great job with its CSR.

The study examined the different corporate governance tools used by FQM to ascertain whether the company has been effective in facilitating transformation through its corporate governance. A closer look shows that the company’s corporate governance has serious shortcomings. The research found that the company’s board composition included only one Zambian national (at the time of completion of the research in February 2020).

We believe that if FQM uses the modest findings and recommendations in this report it could improve its CSR. We equally believe that the government of Zambia and Zambia Environmental Management Agency could play a more prominent role to support mining companies to improve their CSR programmes.

Read the full report here.

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