Rio Tinto in Africa Global Citizen or Corporate Shame?
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IndustriALL is committed to a campaign that: Shines a light on the activities of Rio Tinto in communities across the world Measures up Rio’s claims to being a good corporate citizen with the realities. C ommunicates with shareholders and the business community to inform them of Rio’s behaviours. Builds a global campaign audience through members, activist groups and the global environment movement. | RIO TINTO IN AFRICA */2%$/&,7,=(125&25325$7(6+$0("
Rio Tinto in summary: RIO TINTO plc.
7<3( Public Company
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5(9(18( US$ 26.2 billion (2010) US$ 27.4 billion (2011)
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Source: http://en.wikipedia.org/wiki/Rio_Tinto_Group
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RIO TINTO IN AFRICA */2%$/&,7,=(125&25325$7(6+$0(" | CONTRIBUTION OF RIO TINTO’S FIVE PRODUCT LINE TO GROUP EARNINGS IRON ORE: 5LR7LQWRLVWKHVHFRQGODUJHVWSURGXFHUVXSSO\LQJWKHJOREDOVHDERUQHLURQRUHWUDGH,URQRUHWKDWLVH[SRUWHGE\ RFHDQWUDGHURXWHVWRFRDVWDORUQHDUFRDVWVWHHOPDNLQJSODQWV ,URQ2UHFRQWULEXWHVRIWKHJURXS¶VWRWDOHDUQLQJV )RUWKHWKLUGTXDUWHURIVD\V$OEDQHVH³:HKDYHVHWQHZTXDUWHUO\UHFRUGVIRULURQRUHVDOHVDQGKDUG FRNLQJFRDOSURGXFWLRQDVRXURSHUDWLRQVUHFRYHUHGIURPWKHVHYHUHZHDWKHUH[SHULHQFHGHDUOLHULQWKH\HDU :KLOVWZHDUHPLQGIXORIFXUUHQWPDUNHWYRODWLOLW\WKHIXQGDPHQWDOVDUHKROGLQJXSZHOOSDUWLFXODUO\IRUEXONWUDGHG FRPPRGLWLHV:HDUHRSHUDWLQJDWIXOOFDSDFLW\VHOOLQJDOOZHSURGXFHDQGRXUJURZWKSURJUDPPHLVRQWUDFN VXSSRUWHGE\WKHVWUHQJWKRIRXUEDODQFHVKHHW´ 5LR7LQWRSURGXFHGDUHFRUGPLOOLRQWRQQHVRILURQRUHLQWKHIRXUWKTXDUWHURIDQGPLOOLRQWRQQHVIRU WKH\HDU ALUMINIUM: 5LR7LQWR¶VLQWHJUDWHGIDFLOLWLHVLQFOXGHKLJKTXDOLW\EDX[LWHPLQHVDQGDOXPLQDUH¿QHULHVDVZHOODVVRPHRIWKH ZRUOG¶VlowestFRVWSULPDU\DOXPLQLXPVPHOWHUV Products %DX[LWHDOXPLQDDOXPLQLXP $OXPLQLXPFRQWULEXWHVRIWKHJURXS¶VWRWDOHDUQLQJV ,WLVWKXVQRWVXUSULVLQJWKDWLQOctober 20115LR7LQWRDQQRXQFHGLWKDGGHFLGHGWRmove away from its aluminum business and would put up close to $8 billion worth of assets for sale2QO\IRXU\HDUVHDUOLHU5LR7LQWRKDG SXUFKDVHG&DQDGLDQDOXPLQXPJLDQW$OFDQIRUELOOLRQDQDFTXLVLWLRQWKDWOHIWLWZLWKDKXJHGHEWEXUGHQ 7KHPRYHZDVDQLQGLFDWLRQWKDW5LR7LQWRZLOOGLYHUWPRUHRILWVUHVRXUFHVLQWRLWVLURQRUHEXVLQHVVZKLFK DOUHDG\FRQWULEXWHVDERXWRIWKHFRPSDQ\¶VHDUQLQJVRio Tinto said it would sell 13 assets which include VPHOWHUVDQGUH¿QHULHVDFURVV$XVWUDOLD1HZ=HDODQG*HUPDQ\)UDQFHDQGWKH8QLWHG6WDWHV7KH estimated worth of these assets come to $8 billion. COPPER: ,Q5LR7LQWRSURGXFHGWKRXVDQGWRQQHVRIFRSSHUPDNLQJLWWKHZRUOG¶V¿IWKODUJHVWVXSSOLHU5LR7LQWR DOVRSURGXFHGWKRXVDQGRXQFHVRIJROGDQGWKRXVDQGWRQQHVRIPRO\EGHQXPDVE\SURGXFWVRILWVFRSSHU RSHUDWLRQV Products &RSSHUJROGPRO\EGHQXPVLOYHUQLFNHO &RSSHUFRQWULEXWHVWRWKHJURXS¶VWRWDOHDUQLQJV DIAMONDS AND MINERALS GROUP: 5LR7LQWR¶V'LDPRQGV 0LQHUDOVJURXSFRPSULVHVPLQLQJUH¿QLQJDQGPDUNHWLQJRSHUDWLRQVDFURVVthree sectors. 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ZZZLQYHVWRSHGLDFRPWHUPVEEX\EDFNDVSL[]]X,Q=FQ00 Protesting at the Rio Tinto Annual General Meeting in London on 19 April 2012, Marc Maltais, President of United Steelworkers (USW) Local 9490 representing locked out workers at a Rio Tinto smelter in Alma, Canada said, “World class athletes deserve medals that aren’t tainted by Rio Tinto’s brutal treatment of its own workers and communities.” | RIO TINTO IN AFRICA */2%$/&,7,=(125&25325$7(6+$0(" Rio Tinto Global Citizen - the scorecard FICTION 1 | ON SUSTAINABLE DEVELOPMENT AND THE SOCIAL LICENCE TO OPERATE “Rio Tinto is committed to contributing to the social, economic, and institutional development of the communities in which we operate. It is important to our shareholders, employees and many other stakeholders that we contribute to societal stability through local employability and employment opportunities, local procurement, civic governance and the transparent payment of tax and dividend SD\PHQWV2XUDVSLUDWLRQLVWREULQJVXVWDLQDEOHDQGQHWHFRQRPLFEHQH¿WWRWKHUHJLRQVDQGFRXQWULHV in which we have a presence. This approach helps us build a reputation as an organization that facilitates economic growth in the places where we work. In turn, this helps us earn our social licence to operate.” FICTION 2 | ON LABOUR RELATIONS 5LR7LQWRPDLQWDLQVWKDW “respect is central to a harmonious workplace, where the rights of employees are XSKHOGDQGZKHUHWKHLUGLJQLW\LVDI¿UPHGIUHHRILQWLPLGDWLRQGLVFULPLQDWLRQRUFRHUFLRQRIDQ\NLQG´ “Over the last sixteen years, the company has resolved all its contract negotiations throughout the world ZLWKRXWFRQÀLFW´7RP$OEDQHVHLQDOHWWHUVHQWWRD%ULWLVK03RQDOOHJDWLRQVDERXW5LR7LQWR¶VODERXUUHODWLRQV FRQGXFW FICTION 3 | ON HUMAN RIGHTS. 5LR7LQWRSURIHVVHVWR “...set out to build enduring relationships with our neighbours that demonstrate mutual respect, active partnership, and long term commitment.” FICTION 4 | ON ENVIRONMENT STEWARDSHIP 5LR7LQWRPDLQWDLQVWKDW “excellence in environmental performance and product stewardship is essential to our business success... Wherever possible we prevent, or else minimise, reduce and remedy the disturbance of the environment.” THE FACTS SPEAK DIFFERENTLY FACT 1 | ON SUSTAINABLE DEVELOPMENT AND THE SOCIAL LICENCE TO OPERATE 5LR7LQWRKDVEHHQGHVFULEHGE\WKH London Mining NetworkDVIROORZV“From Papua New Guinea to Namibia, from the Upper Peninsula of Michigan in the U.S. to Madagascar, and from Cameroon to Indonesia, Rio Tinto has a long and shameful record [across all human development indicators – labour, social, economic, and environmental]” FACT 2 | ON LABOUR RELATIONS Former Australian Prime Minister Bob HawkeRQFHVWDWHG“What runs through as a common thread is [Rio Tinto’s] philosophy that they want to see the trade unions out of their operations” (Corporate Watch) $FFRUGLQJO\5LR7LQWRKDVFRQVLVWHQWO\PDLQWDLQHGDVWUDWHJ\WKDWLQYROYHVH[SORLWDWLYHODERXUSUDFWLFHVH[SRVLQJ WKH¿FWLWLRXVOLHDERXWLWVODERXUUHODWLRQV,QUHVSRQVHWRWKHVHOLHVDQGPRWLYDWHGE\WKHOLYHGH[SHULHQFHRILWV PHPEHUVDFURVVWKHZRUOGWKH,QWHUQDWLRQDO)HGHUDWLRQRI&KHPLFDO(QHUJ\0LQHDQG*HQHUDO:RUNHUV8QLRQ ,&(0 QRZ,QGXVWUL$//*OREDO8QLRQPRYHGWRIRUPWKH5LR7LQWR*OREDO1HWZRUNWRFRQIURQWWKH5LR7LQWR¶V ODERXUSUDFWLFHV 7KH*OREDO1HWZRUNZDVIRUPHGLQRUGHUWRFKDOOHQJHWKHFRPSDQ\¶VODERXUULJKWVYLRODWLRQVDQGXQLRQEXVWLQJ DFWLYLWLHVDQGKXPDQULJKWVDEXVHVDWPLQHVLQYDULRXVSDUWVRIWKHZRUOG$PRQJWKHFKDUJHVZHUHDFFXVDWLRQVRI GLVFULPLQDWLRQDJDLQVW+,9SRVLWLYHZRUNHUVLQ=LPEDEZHZKRZHUH¿UHGEHFDXVHRIWKHLUVWDWXV 5LR7LQWRLQJHQHUDODQGLQSUDFWLFHSUHIHUVWRDYRLGQHJRWLDWLRQVZLWKPLQHZRUNHUV¶XQLRQVDQGSUHIHUVWR¿QG VROXWLRQVZLWKWKHZRUNHUVWKHPVHOYHVLQVWHDGRIKDYLQJDWKLUGSDUW\LQYROYHG 5LR7LQWR¶VFRQGXFWDWWKH5|VVLQJ8UDQLXP0LQHKDVEHHQGHSORUDEOH7KH/RQGRQ0LQLQJ1HWZRUNFLWHVWKH 8QLWHG1DWLRQV&RXQFLOIRU1DPLELDDVGHVFULELQJLQWKH VWKHFRQGLWLRQVXQGHUZKLFKXUDQLXPZDVEHLQJ PLQHGDVEHLQJ“...virtual slave labour under brutal conditions. Some of these conditions, continued to as recently as 2000 where black workers were still paid lower wages than their white counterparts”. RIO TINTO IN AFRICA */2%$/&,7,=(125&25325$7(6+$0(" | FACT 3 | ON HUMAN RIGHTS The Company is also +XPDQULJKWVYLRODWLRQVDUHOHJHQGDU\ZLWKLQ5LR7LQWR accused of maintaining a 7KRXVDQGVRIORFDOSHRSOHLQGLIIHUHQWFRXQWULHV LQ$IULFDKDYHEHHQGLVSODFHGE\WKH5LR7LQWR¶V well-armed ³private army´ PLQHGHYHORSPHQWDQGPDQ\KDYHQHLWKHUUHFHLYHG to handle labour or civil DGHTXDWHFRPSHQVDWLRQRUFRPSHQVDWLRQDWDOOIRU WKHLUFXVWRPDU\ODQGULJKWV&RPPXQLWLHVKDYHORVW unrest at the mine and that DFFHVVWRWKHIRRG¿UHZRRGDQGLQGLJHQRXVPHGLFLQHV civilians were killed by the WKDWWKH\UHOLHGRQIURPZKLFKKDVDIIHFWHGERWKWKHLU OLYHOLKRRGVDQGWKHLUORFDOFXOWXUHDQGFXVWRPV*UDYH military, assisted by the VLWHVKDYHEHHQGHVWUR\HGLQWKHFRQVWUXFWLRQRI mine's security forces. PLQH¶V 2FFXSDWLRQDO6DIHW\DQG+HDOWKLVDKXPDQULJKWV LVVXH:RUNHUVKDYHGLHGRQ5LR7LQWRRSHUDWLRQV VL[WHHQE\WKHODVWFRXQWLQWKHODVW¿QDQFLDO\HDUE\ 5LR7LQWR¶VRZQDGPLVVLRQ$OUHDG\5|VVLQJ0LQHKDV UHSRUWHGWKUHHIDWDOLWLHVLQ4RI FACT 4 |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ÀXHQFHRYHUFRPSDQLHVDQGWRDGGUHVVLUUHVSRQVLEOHFRUSRUDWHEHKDYLRXU 7KHLQYHVWLJDWLRQE\6202DQG:,6(UHSRUWVRQKRZ1DPLELDQ1*2VPRVWIDPLOLDUZLWK5LR7LQWR¶V5|VVLQJ 0LQLQJRSHUDWLRQKDYHKHDUGDERXWSROOXWLRQFRPSODLQWVIURPFRPPXQLWLHV 6RXWK$IULFD¶V5LR7LQWR3DODERUDRSHUDWLRQKDVFRQWDPLQDWHGWKHELRGLYHUVLW\RIWKH.UXJHU1DWLRQDO3DUNZKHUH IDXQDDQGÀRZHUKDVEHHQDIIHFWHGDQGKRZVRPHRIWKHSDUNVJDPHV¶VSHUPDQGUHSURGXFWLRQKDYHEHHQDIIHFWHG Workers in Mozambique. | RIO TINTO IN AFRICA */2%$/&,7,=(125&25325$7(6+$0(" Rio Tinto's (un) sustainable footprint in Africa ,Q$IULFDDOLWDQ\RIODERXUFRPPXQLW\VRFLDOHQYLURQPHQWDODQGJRYHUQDQFHSUREOHPVSHUYDGH5LR2SHUDWLRQV (YHQZKHUH5LR7LQWRRSHUDWHVZLWKVRPHVHPEODQFHRIGHFHQF\DVLQ6RXWK$IULFDWKHDIRUHPHQWLRQHGSUREOHPV QRWZLWKVWDQGLQJLWLVODUJHO\EHFDXVH5LR7LQWRFDQQRWJHWDZD\ZLWKZKROHVDOHSOXQGHUEHFDXVHRIWKHOHJLVODWLYH DQGUHJXODWRU\VDIHJXDUGVDQGWKHSRZHUDQGLQÀXHQFHRIWKHWUDGHXQLRQVDQGFLYLOVRFLHW\EURDGO\ EXAMPLES OF COUNTRY EXPERIENCES SOUTH AFRICA: 5LR7LQWRKDVDGHSORUDEOHKLVWRU\DQGFRQVFLRXVO\WRRNDGYDQWDJHRIWKHSROLWLFDOFOLPDWHGXULQJ$SDUWKHLGDVLWGLG LQ1DPLELDDQGHOVHZKHUHDFURVVWKHZRUOGZKHUHUHSUHVVLYHUHJLPHVUHLJQHG&RQVLVWHQWZLWKWKHSUR¿WPRWLYHDW DOOFRVWV5LR7LQWRFRQWLQXHGWRXQGHUSD\LWVEODFNZRUNHUVFRPSDUHGWRWKHLUZKLWHFRXQWHUSDUWV NAMIBIA: 6LPLODUO\LQ1DPLELD5LR7LQWRWRRNDGYDQWDJHRIWKHSROLWLFDOFOLPDWHWRYLVLWXSRQLWVEODFNZRUNHUVGLVFULPLQDWRU\ ORZZDJHVDQGDSSDOOLQJZRUNLQJDQGOLYLQJFRQGLWLRQV³DNLQWRVODYHU\´ 4000,1()257'$83+,10$'$*$6&$5 5LR7LQWRRSHUDWHVDQLOPHQLWHPLQHRQWKHHDVWFRDVWRIWKHLVODQG7KHHQWLW\RQWKHJURXQG4,70DGDJDVFDU 0LQHUDOV6$LVDMRLQWYHQWXUHEHWZHHQ5LR7LQWR¶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ÀX[RIZRUNHUVIURPHOVHZKHUHKDVLQFUHDVHGGHPDQGIRUIRRG DQGKRXVLQJGULYLQJSULFHVXSEH\RQGZKDWORFDOUHVLGHQWVFDQDIIRUG 5,27,1729$/(5,9(56'$/(&2$/02=$0%,48( 5LR7LQWRVD\VLWV5LYHUVGDOHFRDOGHYHORSPHQWLQFHQWUDO0R]DPELTXHZLOOHQKDQFHWKHHFRQRP\RIWKH(DVW $IULFDQFRXQWU\IRUWKHQH[W\HDUV³,Q0R]DPELTXHWKH5LYHUVGDOHDFTXLVLWLRQUHQDPHG5LR7LQWR&RDO 0R]DPELTXHSURYLGHVDQRSSRUWXQLW\IRUPRUHWKDQ\HDUVRIVXVWDLQDEOHJURZWKZLWK%HQJD6WDJH2QHRQ WUDFNWREHFRPPLVVLRQHGE\\HDUHQG´5LR7LQWRVDLGLQDVWDWHPHQWLQ6HSWHPEHU,WKDLOHG5LR7LQWR&RDO 0R]DPELTXHDVDZRUOGFODVVTXDOLW\SURMHFW5LR7LQWRKDGDFTXLUHGWKHSURMHFWLQ$XJXVWIRUDERXWELOOLRQ +RZHYHULQ)HEUXDU\WKHLQGHSHQGHQW1*26RXWKHUQ$IULFD5HVRXUFH:DWFKVD\V5LR7LQWRDQGLWVSDUWQHU 9DOHDUHPRYLQJYLOODJHUVWRSRRUODQGIDUIURPMREVWRPDNHZD\IRUFRDOSURMHFWVLQFHQWUDO0R]DPELTXH/RFDO HQWUHSUHQHXUVDUHDOVREHLQJVLGHOLQHGVD\VWKHRUJDQL]DWLRQZKLFKPRQLWRUVWKHLPSDFWRIPLQLQJDFURVVWKHUHJLRQ 'U&ODXGH.DEHPEDDQG&DPLOR1KDQFDOHIRXQGVRPHNH\IDLOLQJVRIWKHFRPSDQLHV¶GHHSO\SUREOHPDWLF UHVHWWOHPHQWSURJUDPPHLQFOXGLQJ Dividing the original communities by resettling workers close to the mine and dumping all the other people over 40km away and far from the main road. “The impression this model gives,” says the report, “is that uneducated and unemployed members of a community can be dumped anywhere...” Moving families to the new sites even though construction work had not been completed and basic services such as water and electricity were not in place. In Mualadzi, people were resettled before the promised schools or clinic had been built; Constructing houses that are already cracking just a few months later; Not providing the promised paved roads; 3URYLGLQJLQVXI¿FLHQWODQGIRUVXEVLVWHQFHIDUPLQJLQDQDUHDZKHUHWKHVRLOVDUHQRWSDUWLFXODUO\IHUWLOH or productive and where the same land is also sometimes claimed by other communities; and N ot consulting widely enough with the affected people, who claim to have had very little knowledge about the resettlement program. 7KHUHVHDUFKHUVVWXGLHGUHVHWWOHPHQWHIIRUWVE\5LR7LQWRDQG9DOHVLQFHWKH\EHJDQPLQLQJLQ0R]DPELTXH¶V 7HWHSURYLQFH RIO TINTO IN AFRICA */2%$/&,7,=(125&25325$7(6+$0(" | 7KHVDPHZHHNWKHUHSRUWZDVUHOHDVHGKXQGUHGVRISURWHVWHUVHQUDJHGDWWKHZD\WKH\KDYHEHHQUHVHWWOHG EORFNHGWKHUDLOZD\OLQHWKDWWUDQVSRUWVFRDOIURPWKHPDVVLYHQHZPLQHVLQ7HWH3URYLQFHWRWKHFRDVW7KH\ GHPDQGHGWKDWWKHFRPSDQLHVIXO¿OOWKHLUREOLJDWLRQVWRWKHWKRXVDQGVRISHRSOHZKRKDGEHHQPRYHGIURPWKHLU ODQGVWRPDNHZD\IRUWKHPLQHV LOM-PANGER DAM, CAMEROON: 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