MGT502 Organizational Behavior - Free Samples to Students

Answer:

Introduction:

One of the biggest mining companies in Australia is the Evolution mining company. The company was started in 2011 through the merger of Catalpa Resources limited and Conquest Mining limited. Following that merger, the company has been through a spree of acquisitions that help it grow dynamically. First was the acquisition of Newcrest Mining, and through this acquisition, the company gained the mining interests in the Cracow and Mt Rawdon mines. Then it went ahead to the acquisition of Cowal and Mungari in July and August 2015 respectively, these acquisitions were reported in their full year report of 2018. Australia is one of the few countries on the planet that has a vast deposit of mineral, both precious metal and crude oil. These large deposits create an avenue for the spring up of several mining companies since there is plenty of space for everyone. It is these companies that have enabled the unstoppable growth of Evolution Mining. The company itself has a reputation for reliability and consistency even though they have been in business for only a short while. It has managed to keep a reliable track of consistent achievement of production and cash cost guidance, They even managed to win the NSW Mining Safety Excellence Award in 2017.

The main products of Evolution Mining are gold and copper. They operate major mines in Cowal, South Wales; Mt Carlton, Mt Rawdon, and Cracow, all in Queensland; and Mungari in Western Australia. These projects are currently running although the company also has economic interests in sites such as Ernest Henry in Queensland. These projects deliver 100% of the gold, 30% of the copper and silver the company deals in. The Ernest project is set to deliver 49% of gold, copper, and silver in the future. The size of the company is determined by the size of projects it undertakes, in the financial year ended 2018, the company had produced a total of 801,187 ounces of gold which sold at A$797 per ounce. And for the financial year 2019, they have a projected production of 720,000 to 770,000 ounces that will cost between A$850 - A$900 per ounce of gold. It is numbers like these that prove their reliability in production and cost guidance (Evolution Mining Ltd Investor Day, 2017).

The company also doesn't hold back when it comes to community management. In fact, they came in as runners-up for the Community Excellence Award of 2017. A brief description of the communities that surround them would be that those communities are rural and away from any major cities. Evolution Mining prides itself in being at the forefront of community outreach and even has stated in their website that their number one goal is to have the communities at a better state for the simple reason of their existence in that particular area. They say, according to Mactaggart et al., (2017), their desire is to leave a positive legacy. They have a community relations policy and community principles that they use when they are integrating into a new community.

Given that the communities within which they operate are rural, they have tailored they interaction procedures and guidelines to tend directly to that community.  Like Bond, Barclay, and Pattenden (2013) state, Evolution Mining has helped most of the communities that they operate within in different ways; local sponsorship, for example, the Cowal sponsorship programme; donations and partnerships, training, apprenticeship and scholarships, local employment and procurements. The company even formed a local emergy response team to cater to emergencies like accidents or incidents. The company has also helped with education in the areas they operate, for example, they partnered with Coolgardie Primary School to build a new sensory play are and bush tucker garden both of which has greatly helped increase pupil's engagement. They also strive to empower the youth through programmes like the WA Department of Sport & Recreation programme and The Shire of Coolgardie, which along with the police, help hinder petty crimes and fight anti-social behavior (Hongtao et al., 2017).

The company has formed a community outreach team which can be contacted at any time. This team is comprised of select members of the communities that the company is operating. The main duties of this team are to take feedback from the community about how the company is performing in regards to the community standards; they also welcome any suggestions on areas they can improve upon to better serve the community. The progress made by the company is reported in an annual community report that is released alongside the annual financial report. One can confidently say that Evolution Mining cares for all the communities within which they operate. In fact, the management tactics of Evolution Mining is so good that almost no community outrage has been reported from any of the communities they operate in within Australia. It is also worth mentioning that Evolution Mining annually reports on their extended attempts to secure the environment in the places they operate. Safety of the environment is very important to that.

Barrick Gold Corporation

Another highly comparable company is Barrick Gold Corporation. This is a company that approaches things differently, they view everyone, including their employees as shareholders and members of the company that has a take in it. The organization was started in Canada in 1983 and employs over 11000 people worldwide. They have running operations in over 10 countries including Australia and Tanzania (Newenham-Kahindi, 2011). It is different from Evolution Mining in that more than 75% of their gold comes from the United States and Canada. But they have mining operations in Australia too. With their international status, they are a big company, their reserves for gold and copper is almost immeasurable; In the Barrick Gold Corp Annual Shareholders Meeting of 2017, the following numbers were given; 64.4 million ounces of proven and probable gold which is on top of 88.6 million ounces of measured and indicated gold reserves. They also have 8.1 billion pounds of proven and probable copper reserves and 7.3 billion pounds of measured and indicated reserves of copper. In 2017, they produced a total of 53 million ounces of gold and 413 million pounds of copper, they had net earnings of 1.4 billion USD for the sales of gold. In Australia, their biggest mining site is in Kalgoorlie. The site produced a total of 368,000 ounces of gold which sold for $806 per ounce in the financial year 2017. The site also mines copper; it produced a total of 3,858 pounds of copper in the financial year 2017.

Doohan (2007) write that it is true that mining can benefit the local government in many ways, in their community policy programme, Barrick corporation states that their ability effectively operates depend on them properly managing community relations. Some of the benefits the company state as coming from mining are improved economic activity, job creation, and development of infrastructure. As well, mining can improve the social status of a community. It is a strong belief at Barrick that developing a strong relationship with host communities is about getting the small things right. The organization achieves this by managing their impacts, for example, noise, traffic, and infrastructure, sharing with the community the advantages of mining and showing respect to the community (Goswami, 2015).

The corporation has set up a Community Relations Management System (CRMS)that is made up of different components; a Community Relations(CR) Policy, a CR standard, and supporting procedures. The community relations management system provides guidelines for operations of Barrick Corporations at their sites (Barrick Gold Corporation, 2014).

The value of community relations is so important to the organization that in 2017 they revised their CRMS to better suit the company sustainability vision. In their new CRMS,Kirschke (2014) discusses, they introduced a scoreboard that ranks the different levels of satisfaction in communities. The score is determined by the level of community support.

After the introduction of the scoreboard, different sites conducted a survey to gauge community support. The main purpose of this technique is to provide a means to measure the progress in sites.

CRMS determines and gives a guideline of how the site will establish itself in a specific region, it, therefore, helps the organization determine if there are communities that have to be treated in a different more specific way, for example, how well is the safety of the community, are there any indigenous people, how does the organisation deal with acquisitions and resettlement (PR Newswire, 2011).

The CRMS is broad, one section of it is the community engagement; it requires the member of the organization to engage the community consistently, transparently and comprehensively in all the locations. And given that the CRMS is not strict, it can be bent to accommodate unforeseen problems with community relations. In the eyes of the company, the community is a stakeholder in the mine, and since it is company policy that stakeholders are informed promptly of any developments, the CRMS also requires that the community is informed of any progress or change in the site, which may include plans to migrate the mining site writes Strange et al. (2017).

Triscritti (2013) states, CRMS helps the organization and the community build a strong relationship by issuing guidance and means for engagement in best practices, issuing the goals of the organizations and a way to confirm and measure the effectiveness of their efforts.

For a company as big as Barrick Corporation, community outrages or incidents of an outrage cannot miss, as a matter of fact, the organization has had more than a few incidents; in 2017 in Peru, the local community at one of their sites blocked the closure of their site claiming problem with the water supply. They claimed that the site was taking all the water and therefore the community was left without water.

The organization has also had environmental issues, in March 2018, a pipe in Veladero Argentina, ruptured causing an environmental disaster (Metals & Mining Industry Profile: Argentina, 2018). This led to a protest by an environmental group. The organization managed to contain the rupture with the site but later on apologized for the incident.

With the emergence of all these grievances, the organization has set up a grievances system that seeks to receive and settle as many grievances as possible with the shortest time possible. The local community, through this system, is able to report all problems directly to Barrick officials so that they can be solved. The organization has put in place a compulsory policy that complaints have to be handled. The complaints go through the executive director and the general manager an has to be viewed by the stakeholders (women and vulnerable people).

A 2017 statistic shows that in that year 259 complaints were submitted and out of those 244 were resolved, which included complaints from the previous year. The organization has implemented a mechanism to measure the success of a site, they do so by checking the number of grievances solved and how quick they were solved. The organization also logs the number of grievances submitted to a site and in that way they are able to judge how well the site is doing in terms of community relations. Through these grievances, the organization knows how to hire, resettle and compensate the local community. The satisfaction of everyone involved is dependent on the cooperation of both parties.

Comparison

A major part of this analysis is the comparison of the two companies. According to me, they are the same just operating on a different scale and size. Barrick Corporation is a multinational organization and has managed to survive for a long time based on its good community relations programme, it has engaged the communities in their operations treating them as a part of the organization itself, this kind of approach makes the operations of the business smooth and effortless. What helps their operations, even more, is the grievance system put in place to deal with any issues present. Evolution Mining operates along the same lines, they value the cooperation of the local community although they have no grievance system. Both companies help these local communities extensively and depend on them for employment. In conclusion, this analysis has determined that both organizations shave the same operations and similar community outreach and relations programmes.

References

Newenham-Kahindi, A.  (2011). A Global Mining Corporation and Local Communities in the Lake Victoria Zone: The Case of Barrick Gold Multinational in Tanzania. Journal of Business Ethics, 99(2), 253–282. https://doi.org/10.1007/s10551-010-0653-4

Kirschke, J. (2014). Communities and Sustainability: More Than Mitigation. Engineering & Mining Journal (00958948), 215(9), 54–63. Retrieved from https://search.ebscohost.com/login.aspx? direct=true&db=buh&AN=98679990&site=ehost-live

Barrick Gold Corp Annual Shareholders Meeting - Final. (n.d.). Fair Disclosure Wire (Quarterly Earnings Reports). Retrieved from https://search.ebscohost.com/login.aspx direct=true&db=bwh&AN=32U0956256458FDW&site=ehost-live

Metals & Mining Industry Profile: Argentina. (2018). Metals & Mining Industry Profile: Argentina, 1–45. Retrieved from https://search.ebscohost.com/login.aspx

direct=true&db=buh&AN=127544531&site=ehost-live

Barrick Gold Corporation. (2014). Barrick Gold Corporation MarketLine Company Profile (pp. 1–31). Retrieved from https://search.ebscohost.com/login.aspx? direct=true&db=buh&AN=101407764&site=ehost-live

Triscritti, F. (2013). Mining, development and corporate–community conflicts in Peru. Community Development Journal, 48(3), 437–450. Retrieved from https://search.ebscohost.com/login.aspx? direct=true&db=aph&AN=88429476&site=ehost-live

PR Newswire. (2011, September 7). AFRICAN BARRICK GOLD PLC - ABG Launch of Community Investment Fund. PR Newswire UK Disclose. Retrieved from https://search.ebscohost.com/login.aspx? direct=true&db=bwh&AN=201109070200PR.NEWS.UKDISCLO.0007&site=ehost-live

Bond, C. Barclay, M. & Pattenden C. (2013). BLUE SKY Human Rights Impact Assessment: 2011. Brisbane: Centre for Social Responsibility in Mining, University of Queensland.

Doohan. (2007). Making things come good.  Aborigines and miners at Argyle. Retrieved from https://hdl.handle.net/1959.14/145

Evolution Mining Ltd Investor Day - Final. (2017). Fair Disclosure Wire (Quarterly Earnings Reports). Retrieved from https://search.ebscohost.com/login.aspx? direct=true&db=bwh&AN=32U4121790017FDW&site=ehost- live

Full Year 2018 Evolution Mining Ltd Earnings Call - Final. (n.d.). Fair Disclosure Wire (Quarterly Earnings Reports). Retrieved from https://search.ebscohost.com/login.aspx? direct=true&db=bwh&AN=32U1362634515FDW&site=ehost-live

Hongtao Liu, Yuan Tian, Xueyan Liu, & Jie Jian. (2017). Community Evolution Mining and Analysis in Social Network. AIP Conference Proceedings, 1820(1), 1–6. https://doi.org/10.1063/1.4977393

Goswami, S. (2015). Coal Mining and Indigenous Communities: A Case Study of Jharia Coalfields. European Journal of Economic Studies, 13(3), 139–146. https://doi.org/10.13187/es.2015.13.139

Mactaggart, F., McDermott, L., Tynan, A., & Gericke, C. A. (2017). Exploring the determinants of health and wellbeing in communities living in proximity to coal seam gas developments in regional Queensland. BMC Public Health, 18, 1–13. https://doi.org/10.1186/s12889-017-4568-1

Strange, C., Bremner, A., Fisher, C., Howat, P., & Wood, L. (2017). Local community playgroup participation and associations with social capital. Health Promotion Journal of Australia, 28(2), 110–117. Retrieved from https://search.ebscohost.com/login.aspx?direct=true&db=s3h&AN=124552178&site=ehost-live