Vale’s Chequered Past In Land Management Issues

Friday, 26 June, 2015

The opening bullet point in Vale’s Human Rights Guide is pretty unequivocal: “Mission: to transform natural resources into sustainable development.”

But can a company such as Vale, one of the largest miners in the world, with a market capitalisation on the New York stock exchange of over US$32 billion, really deliver on such sentiments?

“We endeavour to maintain a lasting engagement with communities and implement social, cultural, economic and environmental impacts management as well as contribute to local sustainable development”, the company says.

But it’s less than ten years since the company was struck off from the FTSE4GOOD index and there are still plenty of people around who would argue that Vale’s influence is less than salutary.

Vale operates in 38 countries across a wide range of cultural milieus, and if profit is no respecter of boundaries then neither is dissent. From the indigenous Kanak population in New Caledonia, to resettled Mozambican villagers in Tete province, to residents local to the El Hatillo mine in Colombia, which Vale bought in 2008 and sold in 2012, turning a cool US$100 million profit in the process, there are plenty of people with tales of dissatisfaction with Vale to tell.

In New Caledonia, Vale trumpets the work it undertakes in preserving local cultures, and in particular the local Kanak languages. “Vale listened to the community's concerns and has developed the preservation project in partnership with public authorities”, the company states rather blandly in the social and environmental section of its website.

“Collection of linguistic and iconographic data was carried out together with members of the communities.”

That work resulted in the creation of games, brochures, posters and the collection of local tales in a book. Which is nice enough work for ethnographers and certainly valuable in itself, but clearly wasn’t enough of a contribution to appease the rioters who torched vehicles, equipment and buildings at the company’s Goro nickel mine at the south end of the island this time last year.

That riot was in response to a 100,000 litre chemical spill at the US$6 billion plant at Goro, which killed about 1,000 fish and enraged local young people. And although Kanak elders didn’t condone the violence, the destruction did deliver one clear result: it allowed Vale to put a tangible value on events following the spill, between US$20 million and US$30 million.

But protestors have to tread carefully in cases like these. The Goro mine is the second biggest employer in New Caledonia’s southern province, and causing severe disruption to a project like that could endanger livelihoods and turn an otherwise favourably disposed population against further protest. But the situation at Goro is further complicated because a significant number of the employees are actually foreigners, in this case from the Philippines.

At El Hatillo in Columbia, the violence against Vale took a more deadly turn, as one person was killed in rioting against planned resettlement, a vexed issue in Columbia in regard to the coal mining industry, and one which we will return to in more detail in due course.

Meanwhile, over in Mozambique, the situation in the Tete province was clear-cut enough to attract the attention of the well-known pressure group Human Rights Watch.

Human Rights Watch did not, apparently, think that Vale was living up to the stated aspiration in its Human Rights Guide, namely to “transform natural resources into sustainable development”.

On the contrary, Human Rights Watch highlighted how “serious shortcomings in government policy and mining companies’ implementation uprooted largely self-sufficient farming communities and resettled them to arid land far from rivers and markets”.

The aim was to make space for huge coal mining operations in the province, which Vale did back in 2013 alongside Rio Tinto, although Rio subsequently sold out to an Indian group.

But the land clearance hasn’t exactly been a roaring success. “These communities have experienced periods of food insecurity or, when available, dependence on short-term food assistance financed by Vale and Rio Tinto”, continued Human Rights Watch.

“These multi-billion-dollar investments are supposed to drive development in one of the poorest countries in the world, yet they have actually made life harder for many people.”

In its 2014 Sustainability Report, there is no update on the relocated Mozambican villagers, although Vale does state that 57 per cent of registered demands and complaints from local communities worldwide relating to its operations were resolved.

It added that 31 per cent were not the responsibility of the company, which can’t have been much of a comfort to the complainants, and that 12 per cent went unresolved. It’s not stated whose complaints comprised the 12 per cent.