Beyond Beads n Trinkets

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Beyond Beads n Trinkets
A systematic framework for assessing and
managing social performance
A presentation to the European Bank for
Reconstruction and Development March 29,
2000 EBRD Headquarters London, U.K.
Presented by Wayne Dunn www.waynedunn.com
info_at_waynedunn.com
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Presentation Overview

• Growing Importance of Community and Indigenous
  Peoples relationships
• Corporate responses
• Need for a systematic approach
• A systematic framework for assessing and managing
• Benefits of using a systematic approach
• Implementation Components Tools
• Questions and Discussion

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Our background

• International management consulting firm
  specializing in corporate community relations
  management systems (www.waynedunn.com)
• Direct experience with corporate, community, NGO,
  government and institutional sectors.
• Born in Canada
• Broad personal experience Prospector to Stanford
  Business School
• Pragmatic approach to issues management

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World is Changing
1 Billion cost

• Friday August 13, 1999 Big Oil Cos. Stop Nigerian
  Pumping
• LONDON (AP) -- A joint venture between Texaco
  Inc. and Chevron Corp. was forced to stop pumping
  oil off the coast of Nigeria on Friday because
  angry residents in the area blocked supplies from
  reaching the company's platforms.

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Beyond Beads n Trinkets

• Organizing project investment activities so that
  they are profitable and maximize their
  contributions to the long term, culturally
  appropriate, sustainable development of the
  region in which they are located

Project Governments Civil Society/Local
Communities Develpoment Interests
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Community relations a new challenge

• The corporate community interface is a new
  challenge
• Communities have increased influence and bottom
  line impacts
• Not unlike the challenge posed by emergence of
  environmental issues in the 80s and 90s

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Social License No project is immune
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Why is this happening

• Global media The CNNization of the world
  remote local issues direct to television screens
• Proliferation of NGOs direct, well organized
  and financed support to communities
• Internet and other communications innovations
  direct communications from remote projects to
  worldwide audience
• Global Democratization increased attention to
  local issues

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Why is this happening (cont)

• International standards and directives
• World Bank Operational Directive 4.30
  Involuntary Resettlement
• World Bank Operational Directive 4.20
  Indigenous Peoples
• IDB Community Consultation, Sustainable
  Development
• IDB Operational Directive 710 Involuntary
  Resettlement
• International Labour Organization Convention 169
  on Indigenous and Tribal Peoples Convention
• United Nations Conference on Environment and
  Development Chapter 26, Agenda 21
• United Nations Declaration on the Rights of
  Indigenous Peoples (Draft)
• Organization of American States Declaration on
  the Rights of Indigenous Peoples (Draft)

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Why is this happening (cont)

• Increased permeability of institutional and
  organizational boundaries
• Regulatory frameworks and licensing-permitting
  procedures platforms for public involvement
• Growing public interest - driven by increased
  access to information (CNNization and other
  communications)

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NGOs a powerful force
1 Trillion influence

• Big government, big business give way to 1
  trillion big nonprofit sector
• Washington (AP) -... NGOs distribute more aid
  than World Bank and, if viewed as a nation, would
  rank 8th in economic power... Key roles in trade,
  environment, corporate decision making
• Tony Blair third way in world affairs
• Gerhard Schroeder represent the new middle
• Employ over 7 of U.S. Workforce
• Distribute 30 of U.S. aid

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Increased community influence

• Social/local license
• Communities supported by well organized/financed
  NGOs and interested public
• Direct community influence on project design,
  development and profitability

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Community issues have direct impacts

• Project delays and blockages
• Difficulty securing regulatory approvals and
  permits
• Increased cost and complexity
• Difficulty accessing financing
• Increased political risk premiums
• Erosion of management credibility
• Deterioration in government and institutional
  relations
• Erosion of corporate reputation
• Increased scrutiny of other operations

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Financial stakeholders are targets too

• Project and reputational risk for developers and
  financial backers
• Greens Gun for Finance FT Feb 9, 1999
• Potential impacts
• Negative publicity
• Possible boycotts of consumer business
• Bank of America (California offshore)
• Stakeholder concerns

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Corporate responses

• Corporate policy statements
• Increasing communications (reports, executive
  speeches, etc.)
• Social and community relations approaches
• Efforts at systematizing approaches
  social/community issues

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Connecting policies to programs
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Implementation Trap
More than a warm fuzzy issue Spending isnt the
answer
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Community Relations Gaps Challenges

• Lack of a protocol/framework inhibits
• Return on community relations investments
• Strategic and proactive management approach
• Corporate learning
• Capacity to design, develop and implement
  comprehensive community relationship programs
• Consistency of application across the enterprise
• Ability to communicate practices and objectives
• Lack of a systematic framework increases risk

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A systematic approach to social issues
Constructive interaction
Measuring monitoring
Projects Operations
Corporate ethos
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Corporate Ethos the foundation

• Understanding the importance of the issue
• Providing tools, training and support
• Bridging cultural and capacity gaps
• Cross-cultural communications and conflict
  management.
• Communications materials
• Integration into corporate culture (safety and
  environment)
• A necessary core competency for the new millenium

Corporate ethos
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Constructive Interaction
Constructive interaction

• Beyond Beads n Trinkets
• Interaction Continuum
• Strategies for developing interaction points
• Leveraging relationships

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Interaction Continuum
Constructive interaction
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Measuring and monitoring
Measuring monitoring

• Objectives, indicators and tracking
• What gets measured gets done
• Impact of interactions
• Systematic integration into corporate management
  practices
• Management objectives and evaluations

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Assessment and Implementation

• Components and Tools
• Policies, Strategies and Implementation
  Frameworks
• Stated Objectives, Indicators and Performance
  Mangement
• Integration into corporate culture
• Management objectives and evaluation/job
  descriptions
• Business unit support
• Training and support programs
• Capacity to design, develop and implement
  relationship programs
• Leveraging relationships
• Communication tools
• Programs and activities (Interaction Continuum)
• Monitoring/Auditing
• Reporting

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Benefits of Using a Systematic Approach

• Enhanced reporting ability/Credit for successes
• Community relations integrated into overall
  corporate strategy
• Connects community relation policy with business
  unit performance
• Enhanced corporate learning and overall social
  performance capacity
• Consistency of application across the enterprise
• Enhanced internal and external ability to
  communicate community relationship objectives and
  performance

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Benefits of Using a Systematic Approach

• Improved risk management
• Regulatory/permitting processes
• Financing access/terms and conditions
• Decreased political risk premiums
• Enhanced government institutional relations
• Improved reputation management
• Improved access to other opportunities
• Facilitates support from other stakeholders

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Summary

• Growing Importance of Community and Indigenous
  Relations
• Corporate responses
• More than a warm fuzzy issue
• Need for a systematic approach
• A protocol/framework for assessing and
  implementing
• Benefits of using a systematic approach

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Questions and discussion