Case story

  • Indonesia

Community Complaint regarding Batu Hijau Project, Newmont Mining Corp.

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Story

Newmont Mining Corporation is primarily a gold producer, with significant assets or operations in the United States, Australia, Peru, Indonesia, Ghana, Canada, New Zealand and Mexico. Founded in 1921 and publicly traded since 1925, Newmont is one of the world’s largest gold producers and is the only gold company included in the S&P 500 Index and Fortune 500. Headquartered near Denver, Colorado, the company has approximately 34,000 employees and contractors worldwide. In 2007, Newmont became the first gold company selected to be part of the Dow Jones Sustainability World Index. Newmont’s industry leading performance is reflected through high standards in environmental management, health and safety for its employees and by creating value and opportunity for host communities and shareholders.

The issue here concerned a debate regarding the cause pertaining to the reduction in fish stock. This was a community complaint against Batu Hijau, supported by an NGO, which led to significant involvement of external stakeholders related to the reduction of fish stock in the east of the island allegedly caused by disposal of mine tailings there. Newmont considered the complaint to be factually inaccurate as, according to the company, mine tailings were not disposed of in the part of the island concerned; yet it was unlikely to be able to resolve the complaint satisfactorily with a company response alone. It therefore facilitated a joint investigation involving representatives of government, a local NGO and academics, including a process of joint fact-finding. This showed the reduction in fish stock to be caused by other factors (for example, poison bombs used by fishermen) which could then be addressed. Through this process, Newmont was able to resolve the complaint and help strengthen community trust in the company. According to one local manager, “Once trust is built, the grievance mechanism is helpful, but the key is trust. The grievance mechanism is really another tool to build credibility and trust.”\

Outcome

The investigation and fact finding process showed that the reduction in fish stock was caused by other factors (for example, poison bombs used by fishermen) which could then be addressed. Through this process, Newmont was able to resolve the complaint and help strengthen community trust in the company.

Contributor(s): This article was modified by Nicolaclayre (3), Admin (1).