Metaphorically speaking, by the time we call the fire department, it’s too late – there’s already a fire. Proactive mediation is an underutilised tool in our business toolbox that could help us ensure there are systems in place to avoid headline-dominating business crises like Marikana.
By BRIAN GANSON.
It is an unfortunate reality of human existence that we lean towards crisis management. Only after the crisis arrives do we ask why it was not prevented.
This pattern is common in Africa. In Ghana, Sierra Leone, and elsewhere on the continent, any number of large-scale mining, commercial agriculture and infrastructure projects have all but ground to a halt, due almost entirely to probably preventable conflicts between governments, companies, labour and communities. This is a story familiar to South Africa, too: there are numerous well-documented conflicts between communities and mining companies.
In April 2017, GroundUp reported on conflict between Kumba Iron Ore and members of the Dingleton community. Kumba wanted to relocate residents of Dingleton to a town nearly 30km away, but 25 families did not wish to move. The dispute was costly and unpleasant for all concerned. Attorney Richard Spoor, representing the Dingleton residents, said mediation might assist the parties in interpreting the International Finance Corporate Guidelines and help Kumba comply. Kumba, for their part, argued that residents had disrupted essential rehabilitation of a site where blue asbestos had been spilled, and were calling for a R1.6 million pay-out from residents. Spoor called the situation “intolerable”.
An example that may be more familiar – and has complex roots – is that of Marikana, where tensions turned bloody and 44 miners were shot dead. The bitter dispute remained unresolved and ultimately gave rise to the longest known wage strike in South Africa. The related commission of inquiry eventually released its report in 2015, but many argue that the situation remains unresolved.
The absence of effective and timeous processes to mediate issues that result in conflict can have disastrous consequences, ranging from extensive financial losses to loss of human life. It can also result in less quantifiable losses: a breakdown in trust and working relationships, lost opportunities, delays, the absence of services and valuable infrastructure or potential for economic growth.
No organisation or individual wants these outcomes. Why, then, does it all go so wrong, so often?
The starting point for failure often lies in the strengths of the company – planning and execution. These become weaknesses in the context of community and other external stakeholder relations. The company intent on pursuing some complex plan of action (such as expanding a mine) is prone to reducing its interactions with others to mere transactions: They ask, what do we need to pay or do in order to move our plan forward? Yet at various junctures, different stakeholders may be fearful, suspicious or angry about company plans and actions and need greater interaction or reassurance. Governments and communities additionally have their own aspirations that may be very different from those of the company. When they don’t trust the company, or don’t believe their fundamental interests are being met, there is often no deal the company can put on the table that will diffuse tensions.
Companies that think in terms of transactions rather than relationships may also tend to compartmentalise stakeholder “problems” within a community relations department that is handed company plans and told to implement them. These companies often fail to see how tensions arising through executive actions (such as negotiating agreements with national authorities without involving local communities) or operational decisions (such as hiring practices that neighbouring communities believe exclude them) need to be addressed by the whole organisation. Community relations officers may have good personal relationships with local officials or community leaders, who all the same remain fearful and distrusting of the company and its intentions, opposing its attempts to move its plans forward.
Finally, companies too often fail to respond to even acute tensions, until a crisis stage is reached – usually defined by the pre-determined company plan hitting a substantial roadblock. Sometimes mediation does take place once other avenues have been exhausted, but it can be likened to calling in the fire department: by that time, things are already burning.
It would be far more effective to invest in fire prevention. In complex environments, companies need to proactively build relationships and manage tensions. This would include mapping stakeholders, their interests and the environment around them; collecting and analysing information in ways that are useful and credible to all concerned; facilitating communication between parties who may have little history of constructive relationships; and perhaps most importantly from a company perspective, helping it develop plans and operations that would avoid (often predictable) conflict in the first place by aligning these with the plans and expectations of others. The fire prevention service would also have the capacity to put out small flames before they became firestorms.
Fire prevention is not how most people (including many practising mediators) understand mediation, which is more commonly focused on bringing in an expert to help pick up the pieces after a destructive conflict has manifested. But the highest and best use of mediation is in fact to build the foundations for constructive working relationships that are resilient enough to manage the challenges that will inevitably arise. This needs to be done long before the flames of conflict have burnt out of control. And it is not a one-time intervention, but an on-going process, facilitated by a trustworthy expert who is integrated into business processes.
Imagine the benefit to South Africa and its economy if Marikana had never happened. Clashes between companies, labour, communities, and governments tend to make headlines when there is a crisis or tragedy. But research shows that such headlines can be avoided when we are attentive to lost opportunity; when we properly engage others around their interests and priorities; and when this is done timeously and continuously. This is the way to move projects forward, create more sustainable growth, and avoid financial and personal losses.
Brian Ganson is Head of the Africa Centre for Dispute Settlement, Adjunct Associate Professor at the University of Cape Town Graduate School of Business (GSB) and convenor of the short course, Company-Community Collaboration and Conflict Resolution for Complex Environments, running in October 2017. For more information go to: http://www.gsb.uct.ac.za/mediation
Issued by Rothko on behalf of the GSB. For more information or interviews contact email@example.com