We’re holding an olympic blog series these couple of weeks focussing on gold, silver and copper mining in resource rich countries as well as on gold, silver and copper mining companies. Following Australia’s first gold medal of the games, PWYP Australia member Peter Colley is our guest blogger with an overview of gold mining company and supplier of the games Rio Tinto. Peter Colley is National Research Director of the Mining and Energy division of the Construction, Forestry, Mining & Energy Union and member of PWYP Australia.
Australia has won its first gold medal, and the athletes were awarded medals made from gold produced by Rio Tinto, the official supplier to the London Olympics.
The London Organising Committee for the Olympic Games claims all suppliers have passed the requirements of its ethical sourcing guidelines, but one does not have to dig much at all to see that Rio Tinto should never have been accredited as a supplier to the Games.
Rio Tinto has a dark past that it would rather leave buried, but even recent events show the company is ruthless and punitive in its dealing with workers and communities. That the company is well-known as a leading sustainability reporter, and has had some (but only a few) of its sites certified by the Responsible Jewellery Council shows just how problematic the entire sustainability reporting and certification process is.
Rio Tinto began back in 1873 as an investment in Spanish copper mines by British investors. The company had its first brush with infamy when it endorsed General Franco’s fascists in the Spanish Civil War in the 1930s.
The company operated its Namibian uranium mine in direct defiance of UN sanctions against apartheid South Africa (which had occupied Namibia) in the 1970s and 1980s. A UN report at the time described the operation as “mined by virtual slave labour under brutal and unsafe conditions”.
In Australia in 1963 the company colluded with the Queensland State Government to forcible evict indigenous people from the site of its Weipa bauxite mine. The police operation involved burning the entire town of Mapoon to the ground under cover of darkness.
Those events happened generations ago and the company claims it is a responsible corporate citizen now. In a letter to a British MP addressing criticism of the company, Chief Executive Tom Albanese claimed Rio Tinto had peacefully resolved all disputes with its employees for the last 16 years.
Mr Albanese must have forgotten the massive dispute with its coal mine workers in Australia in the last 1990s and early 2000s which involved considerable use of the police and private security. And that in settling those disputes – where the company openly stated it would not bargain collectively with its workers despite their express wishes – the company ultimately paid $25 million to settle the largest unfair dismissal claim in Australian history.
The company has since realized that openly opposing workers’ basic human rights is no longer good for its image. But that does not stop the company’s relentless effort to grind down the rights and working conditions of its workers.
At the end of 2011 the company “locked out” its entire unionised workforce at the Alma aluminium smelter in Quebec, Canada. The world aluminium market is in oversupply, prices are low and higher cost operations have been shutting down. But the Alma smelter is a profitable low cost operation and was widely expected to stay in production. However, Rio Tinto saw the market downturn as an opportunity to reduce employment security, health care and retirement benefits at the smelter. It demanded the right to replace retiring workers with contractors to be paid at half the rate of current employees and without benefits.
The six month lockout has recently ended with Rio Tinto backing down. But it is widely suspected that it was only because the dispute threatened to diminish the golden marketing glow of its Olympics sponsorship.
Some recent disputes have been violent. In the second half of 2011 at the huge copper and gold joint venture with the Freeport McMoran company at Grasberg mine in Indonesia, up to 12,000 workers engaged in strike action for improved wages and conditions. There were many violent clashes with police and four people died.
The Grasberg mine also has massive environmental impacts, which have led to the largest institutional investor in the world – the Norwegian Sovereign Wealth Fund – to refuse to invest in the company.
So how is it that Rio Tinto has obtained certification from the Responsible Jewellery Council for “meeting the highest ethical, social and environmental standards” (RJC media release 13 July)?
Firstly, the company has engaged in what is called “fig leaf” certification. It has not sought certification for all of its operations, or even just its gold and diamond operations. The Grasberg mine was not certified, and neither was the massive Escondida copper and gold mine in Chile nor the Northparkes copper and gold mine in Australia.
Secondly, the RJC standard is a company-run certification system in which Rio Tinto is a founding member. It does not involve any stakeholders – labour, environmental or others – in its governance structure. It is hardly a revelation that a certification system the company has founded has managed to certify a small number of the company’s operations.
It is this track record of aggressive and ruthless behaviour masked by slick public relations and “greenwash” sustainability reporting that has seen Rio Tinto take out the gold medal of the Greenwash Gold campaign (www.greenwashgold.org), although it met strong competition from fellow corporate miscreants BP and Dow chemical.
Rio Tinto may claim that it is among the best of gold mining companies. That is more a reflection of the lack of standards applying in the gold industry – an industry that is legendary for its negative environmental and human rights impacts – than it is of Rio Tinto’s own performance.