First principles: R&R before CSR

In a recent article in livemint, the author Arvind Pandey makes a set of excellent points about the importance of a well-planned CSR programme, especially by companies that initiate large projects that affect and displace communities, such as the metals and mining industry. While the article rightly points out that in the current political scenario, these investments are nearly non-negotiable, one got the feeling that the author mixed up Rehabilitation & Resettlement (R&R) with Corporate Social Responsibility (CSR).

It is important to make a distinction between CSR and R&R. Ensuring Rehabilitation & Resettlement of communities affected and/or displaced by big projects is the obligation of the industry and the government. As difficult as it may be, one needs to assess a fair price for land and houses to compensate communities. Also, the damage caused (and to be caused) to the environment needs to be accounted for and this responsibility sits squarely on the industry, with the government playing the role of a fair arbitrator. The industry needs to play fair and does not attempt to secure any undue benefits through manipulating the license and acquisition processes. This is Step Zero and should be factored into proect cost calculations.

In recent years, we have seen companies ignoring R&R at their own peril. Projects such as Singur were disrupted because basic R&R terms were not agreed and acted upon. The stalled projects in Orissa are awaiting a fair resolution to the R&R terms being offered to the communities.

Sustainability and CSR (which are optional and in principle, determined at the discretion of the industry) comes only once R&R activities have been completed. While the Companies Bill and the Mining Bill, may attempt to stipulate CSR spending, the nature of these projects and the exact details may can be left to the industry and they can explore innovative ways of making a difference to communities that live around their facilities. R&R, on the other hand, must be a non-negotiable, governed by statutes.

R&R is the first step towards building a relationship of trust with local communities. A strong CSR programme would secure this relationship and keep communities invested in the prosperity of the industry and of the economy in general.

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