A Chinese mining industry group announced on Friday a set of guidelines intended to promote socially responsible behavior among its companies operating overseas.
The industry group, the China Chamber of Commerce for Minerals, Metals and Chemicals Importers and Exporters, which is affiliated with the government, formally introduced standards for subjects like labor rights, environmental protection and community relations. Overseas companies need to take such issues into account to reduce their investment risks and avoid directly or indirectly harming the countries in which they work, the group said.
The guidelines were developed in collaboration with the German development agency GIZ, and with input from the Organization for Economic Cooperation and Development and Global Witness, an advocacy group that focuses on natural resource management.
China’s direct overseas investment is immense — reaching $90 billion in 2013 — and the majority of it is in mining.
Tyler Gillard, legal adviser for the responsible business conduct unit of the O.E.C.D., said the push to develop the guidelines came from Chinese companies’ desire to learn better practices. “To our surprise, in our initial meetings with Chinese industry groups, they were in fact making the business case to us for responsible business, whereas it’s normally the other way around.”
The announcement is part of a wider push for best practices across Chinese industry. The textile, rubber and forestry industries have developed or are developing guidelines of their own.
The biggest test will be putting guidelines into effect, but there is cause to be cautiously optimistic, said Lizzie Parsons, senior China adviser at Global Witness. She added that adoption was likely to be slow and piecemeal. “That the guidelines are so comprehensive and so progressive is encouraging, but it also will make it daunting for companies.”
Lu Peipei, director of the financing division at the China Hyway Group, which operates mines in Africa, said that she did not find the guidelines overly ambitious but that they would not suit every company. “It’s good to get a deeper understanding of these issues,” she said. “Only when you have the knowledge can you even think about more formally undertaking this kind of work.”
The chamber on Friday signed a memorandum of understanding with the O.E.C.D. to create more detailed directives for enacting the guidelines. The chamber plans to promote the guidelines on its website and through training sessions and communication with companies.
Guo Hongjun, a department director at the chamber, expressed confidence that the group would not need direct government involvement and that companies facing challenges abroad would seek direction. “We are determined to accomplish what we have set forth but can’t forcibly require people to follow our guidelines,” he said.
The guidelines take their cues from international standards like the United Nations Security Council’s recommendations and the O.E.C.D.’s framework for due diligence in supply chains — ensuring that the exploitation and trade of resources from conflict-affected and high-risk areas do not end up fueling serious violations of human rights.
Zhang Jianping, the director of international cooperation at China’s Foreign Economic Research Institute, called for patience by the public around the world toward Chinese companies.
“There will be a gap,” he said, “between their understanding of Western standards and ways of doing things and true international standards.”
By BECKY DAVIS October 24, 2014 in The New York Times