After the events of last month, no Australian can doubt the power of the resource sector. So if this sector has the power to change governments, surely it also has the capacity to transform communities?

Indeed resource companies can, and must, play a role in the broader and more sustainable development of society in general, including attainment of the Millennium Development Goals (MDGs) to improve social and economic conditions the world’s poor.

A number of countries are struggling to meet their MDG targets, including our closest neighbour, Papua New Guinea (PNG), which ranks last among the Asian Development Bank’s Pacific developing member countries on both the Human Development Index and the Human Poverty Index of the United Nations. In PNG, the proportion of people living under the national poverty line has increased and many health indicators have deteriorated in recent years. Yet, while the country struggles to meet their MDG targets, a resource boom is occurring in parallel. There must be a way to create lasting social value from this economic growth.

Some sceptics say this is the government’s responsibility. However, the job of the government is to ensure that the people have their basic needs met – it doesn’t necessarily have to supply the services itself. In fact, almost half of all health services in PNG are effectively sub-contracted to churches to deliver. Resource-sector companies already provide a range of health services to their employees and local populations. We just need to make this more systematic and in concert with national programs.

Speed, efficiency, innovation, creative marketing and leadership are urgently needed to achieve the MDGs. The resource sector has these capabilities in spades. Furthermore, companies also have assets (premises, equipment, transport and delivery systems, and money), business networks (workforce, customers, other businesses, access to governments, international reach) and a skill base (management and communication skills, monitoring capacities, information-technology skills and employee knowledge) that would contribute significantly to reaching these goals. For instance, consider the following examples.

• MDG 4 (reduce child mortality) – resource companies could support immunisation programs by providing vaccines and cold-chain transport; support antibiotic drug supplies by providing transport and supplementation; support female-literacy programs; promote exclusive breastfeeding and birth spacing.
• MDG 5 (improve maternal health) – companies could assist in obstetric emergencies by providing transport and communications; help local health facilities deliver emergency obstetric care; ensure family-planning methods are available; expand antenatal care; train village health volunteers in remote areas; support female-literacy programs.
• MDG 6 (combat HIV/AIDS, malaria and other diseases)
  • HIV/AIDS – companies could implement HIV workplace policy and education; distribute free condoms; provide access to voluntary counselling and testing; deliver programs on how to prevent mother-to-child transmission; assist in active management of sexually transmitted infections.
  • Malaria – companies could support the distribution of impregnated bed nets; increase availability of diagnostic tests and treatment; institute vector-control measures.
  • Tuberculosis – companies could implement the Directly Observed Treatment Short-course (TB DOTS) program and provide diagnostic testing.

It is also in the interests of resource companies to assist efforts to reach the MDGs where they operate. A healthy workforce leads to improved productivity. Healthy villages improve business–community relations and the social license to operate. Certainly, there are growing expectations that these companies will support local social- and economic-development initiatives – something promoted by organisations such as the International Council on Mining and Metals, the Global Reporting Initiative and the International Finance Corporation. While investors do not necessarily reward corporate social responsibility, announcements of socially irresponsible events are invariably followed by significant downturns in a company’s stock value.

The challenge is how to create a facilitative environment, which systematically encourages and enables business participation in the MDGs. We need to start dialogue between resource companies, governments, NGOs and donors about ways to engage the resource sector for lasting social benefit. Relationship issues can impact on the success of extractive industry partnerships, so all parties need to better understand the differences in private- and public-sector motivations, expectations, methods of ‘doing business’ and other ‘people issues’. There must be clear expectations in relation to industry social commitments. Fiscal instruments, such as the tax-credit scheme and distribution of royalties – to create incentives for such participation – should also be broadened.

To date, the experience with partnerships involving the mining sector in PNG has been encouraging. Involvement of resource companies in social development initiatives, while not a panacea for poverty, is a legitimate and valuable asset in the journey towards achieving the MDGs, and will benefit the private sector, government and community alike.

Jane Thomason is an Adjunct Associate Professor at the University of Queensland and is part of a global collaboration to develop a framework for measuring business contribution to development.

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