Markus Weimer, Senior Analyst| 26 June 2013
African Mining: Risks and Rewards
We enable our clients to succeed in complex environments
Control Risks is a global, independent risk consultancy specialising in political, integrity and security risk
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Our worldview
Great rewards possible
But key risks:
• Political
• Social
They are interlinked.
Why are these risks central?
• Complex – require on-going engagement, analysis and readiness to act;
• Incalculable – not necessarily affecting the bottom line immediately;
• Wide-reaching – potentially all operations are exposed to these;
• Devastating – if things go wrong they can potentially go very wrong;
• Knock-on effects – e.g. project execution, cost of operations, supporting infrastructure, etc.
Setting the scene
Perceptions
• Expectations vs Reality
• Jobs, growth, basic services;
• Poverty, inequality, lack of human security, fragility;
Political Actors
• Government(s) – local, regional, national;
• Civil society organisations – local , national, international, global;
• Citizens – tax-payers, opposition party members, media consumers;
• Donor governments;
• Investors!
Wider context
• Media – local, national, international, global social networks;
• Local, national, international and global governance institutions;
Governments
Local, regional, national;
Key questions:
• Who to talk to? Will this change in the future?
• Is there policy coherence amongst various levels?
• Is there capacity locally?
• Legitimacy?
• How does government fit into wider social and political dynamics?
• How do short and long term priorities play out at the various levels?
Civil Society
Local, national, global;
Key questions:
• What are the issues?
• Who are the actors?
• Who sets the agenda?
• What are the perceptions vis-à-vis investors?
• How to engage?
Citizens
• Voters;
• Taxpayers – emerging consciousness as citizens;
• Consumers and producers of information – media, social networks;
• Increasingly young (peri-)urbanites with some degree of education;
Key questions:
• How do citizen dynamics change the context? (locally, nationally?)
• How to engage with citizens effectively? (employment, CSR, civil society?)
Donors
• Traditionally influential for better or for worse;
• Economic crises – reduced budgets;
• Shift from pure development and aid to more trade and other state interests;
• Often influential international players – EU institutions, G8, UN, Bretton Woods, and global governance institutions;
• Emergence of new players – BRICS;
Key questions:
• How does the changing landscape affect traditional donors and the context?
• How will the emergence of new donors change the scene?
• What does a greater focus on trade imply?
Investors
The Investor Effect:
Investments impact the context in which they are made;
• Even if unintended or unaware;
Key:
• Understand the context from the initial stages of investment;
• Monitor the context continuously;
• Develop and maintain an on-going understanding of investment impact (including perceptions);
• Design and implement mitigating measures;
Mitigating measures
For example:
• On-going analysis of context (local ,national, international, global);
• Stakeholder maps;
• Engagement strategies – who, how, where, how often, etc.;
• Communication strategies for on-going operations;
• Communication strategy for crises;
• Due diligence;
• Targeted CSR;
• Early adoption of mitigating measures