On paper, the project seemed like it would be a hit: The investment by the mining company would bring jobs and 21st-century technology to an economically poor area and tax revenues to the government. So why were citizens blocking the roads and protesting in the streets, drawing considerable attention from NGOs and the media and delaying the project?
It’s Never Been More Important for Big Companies to Listen to Local Communities
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Conflicts between multinational firms (particularly those specializing in mining, oil and energy, and real estate) and local communities are not only divisive, they are expensive. The failure to recognize the risk of social conflict can cost millions of dollars and set investments back by years. Yet the same companies that spend months and millions tweaking operational details devote only a small fraction of their resources to understanding and addressing the social risks they face. The result is a limited ability to recognize how their decisions affect — and are affected by — local problems and concerns. To address this, companies and their supply chain subcontractors should learn to build strong relationships, including with those adamantly opposed to their business plans.