Contribution of Mining Industry to Sustainable Development of Territories: The Latin American Case

"Mining industry as a source of raw material is essential to society however, it lacks of good reputation due to the type of management historically applied to many of its social and environmental impacts. It is argued that this situation has hampered the obtaining of social license to operate of a lot of mining projects around the world. The last considerations are very common in Latin American countries. As a result, the mining sector has understood that the viability of the business long term is associated with more profit for the shareholders but also with activities that improve the livelihoods of local communities, enhance the capabilities of local governments and preserve the ecosystems around the projects. Nevertheless, recent studios have shown that most of the current advances to incorporate sustainability concepts in mining have been mainly focused on control and the prevention of environmental and social impacts of extractive activities. Thus, contributing to the development of territories around mining projects constitutes a fundamental aspect of the business competitiveness through reducing cost and risks of stopping projects, innovating new ways of relationship with stakeholders, improving the level of reputation of the industry as well as its position in the market. However, this contribution requires formal strategies and models that enable companies understand the different resources in the territories where their mining activities are developed and those resource transformations, in order to establish the best way to articulate the project with the territory, pursuing an effective contribution to its development, truly sustainable over time even after the mine closure. CONTEXT Currently in the world but especially in developing countries such as Latin Americans, different stakeholders are increasingly vigilant of how mining companies carry out their activities in terms of socio-economic and environmental management of territories, not only for its impact on the livelihoods of the communities that inhabit them, but also because many demanders of raw materials -both countries and companies- have set sustainability standards as a prerequisite to establishing business relationships with mining companies, such as the recently declared Sustainable Development Goals by 2030 (UN, 2015). Accordingly, decide underinvest or not to invest in sustainability issues carries risks for mining companies. However, invest much in the wrong way may involve the same risks. Managers are concerned to ensure profits, and therefore they decide carefully how to invest in the areas of production, R & D or marketing. Likewise, they should think strategically about investing in initiatives related to sustainability. This if they really want that those investments in fact help to improve the competitiveness of the company. The mining industry benefits from natural capital that extracts, so it should implement strategies that lead to remunerate such benefit to the territories (Almaguer, 2007). One option is through the transformation of natural capital in other types of non-existent capital or poorly developed in their areas of influence. In this way, the value generated by the extraction of underground resources is shared and additionally contributing to improving the quality of life of the communities. Historically, mining industry has been into several problems to achieve this, which represents one of the aspects that has most influenced the current reputation of mining industry in some regions of Latin America. Many communities, local governments and civil society organizations continue to associate this activity with the destruction of the social fabric and ecosystems in the territories, and their opposition against companies working in the areas has led to affect the operational continuity of many projects (Hamann, 2003; Prno and Scott, 2012; Slack, 2012)."