Section 4.2 outlines some of the key issues at the intersections of CSR, SCL and
LSLAs in Sub-Saharan Africa. Section 4.3 outlines the methodology of this chapter,
and Section 4.4 quantifies the extent and type of Italian LSLAs in SSA, as well as the
adoption of different SCL schemes. Section 4.5 identifies some of the shortcomings
of current practices for improving the sustainability of LSLAs and offers some
related policy and practice recommendations.
4.2 Corporate Social Responsibility (CSR) and Large-Scale
Land Acquisitions
CSR in the context of LSLAs can be intepreted as a corporate strategy that can be
used to internalise the economic, social and environmental costs and benefits of land
acquisitions (Bracco 2016). A key rationale of CSR is that when the private and
social costs of an economic action (i.e. a land acquisition in this case), are not
aligned, then markets are not sufficient to ensure societal well-being. In the presence
of such externalities, non-market interventions are needed. At the same time, actors
from the private sector (e.g. companies, investors) face pressures from legal systems,
regulatory frameworks and, increasingly, the civil society, to manage such externalities in a way that is consistent with the social good (Heal 2008). Some of the factors
that influence companies to consider the social and environmental ramifications of
their operations (and adopt CSR strategies) include, environmental and social costs,
fairness, reputation risks and shareholder and civil society pressure (Heal 2008;
Weber 2008; Zezza 2013).
In the context of LSLAs in SSA, it is highly possible that land investments that
have not taken into account their possible impacts on the environment and local
communites, run the risk of escalating direct operation costs and delays in project
implementation due to land disputes with local communities, NGOs and/or governments (Mirza et al. 2014; Bracco 2016). For example, apart from hindering company
operations, such conflicts may contribute to the loss of financial support from public
or financial institutions, therefore increasing the financial risks of investors, and
tarnishing company and investor reputation (De Man 2013; Weber 2008). This is
particularly true for big agro-food corporations with well-known brands that face
high reputation costs if their name is associated with irresponsible behaviour (Bracco
2016; De Man 2013).
Foreign investors may avoid such risks by following Free, Prior and Informed
Consent (FPIC) procedures and respecting the rights of local communities to decide
about their land and resources (and be compensated appropriately if given away)
(Global Witness 2012). Therefore, it may be in their best interest to identify all the
stakeholders involved in the LSLA, and to inform, involve and eventually compensate them accordingly (Global Witness 2012).
A company may choose to join a standard, certification and labelling (SCL)
scheme as a strategy to meet its corporate social and environmental responsibility
4 Large-Scale Land Acquisitions in Sub-Saharan Africa and Corporate Social. . .
141
LSLAs in Sub-Saharan Africa. Section 4.3 outlines the methodology of this chapter,
and Section 4.4 quantifies the extent and type of Italian LSLAs in SSA, as well as the
adoption of different SCL schemes. Section 4.5 identifies some of the shortcomings
of current practices for improving the sustainability of LSLAs and offers some
related policy and practice recommendations.
4.2 Corporate Social Responsibility (CSR) and Large-Scale
Land Acquisitions
CSR in the context of LSLAs can be intepreted as a corporate strategy that can be
used to internalise the economic, social and environmental costs and benefits of land
acquisitions (Bracco 2016). A key rationale of CSR is that when the private and
social costs of an economic action (i.e. a land acquisition in this case), are not
aligned, then markets are not sufficient to ensure societal well-being. In the presence
of such externalities, non-market interventions are needed. At the same time, actors
from the private sector (e.g. companies, investors) face pressures from legal systems,
regulatory frameworks and, increasingly, the civil society, to manage such externalities in a way that is consistent with the social good (Heal 2008). Some of the factors
that influence companies to consider the social and environmental ramifications of
their operations (and adopt CSR strategies) include, environmental and social costs,
fairness, reputation risks and shareholder and civil society pressure (Heal 2008;
Weber 2008; Zezza 2013).
In the context of LSLAs in SSA, it is highly possible that land investments that
have not taken into account their possible impacts on the environment and local
communites, run the risk of escalating direct operation costs and delays in project
implementation due to land disputes with local communities, NGOs and/or governments (Mirza et al. 2014; Bracco 2016). For example, apart from hindering company
operations, such conflicts may contribute to the loss of financial support from public
or financial institutions, therefore increasing the financial risks of investors, and
tarnishing company and investor reputation (De Man 2013; Weber 2008). This is
particularly true for big agro-food corporations with well-known brands that face
high reputation costs if their name is associated with irresponsible behaviour (Bracco
2016; De Man 2013).
Foreign investors may avoid such risks by following Free, Prior and Informed
Consent (FPIC) procedures and respecting the rights of local communities to decide
about their land and resources (and be compensated appropriately if given away)
(Global Witness 2012). Therefore, it may be in their best interest to identify all the
stakeholders involved in the LSLA, and to inform, involve and eventually compensate them accordingly (Global Witness 2012).
A company may choose to join a standard, certification and labelling (SCL)
scheme as a strategy to meet its corporate social and environmental responsibility
4 Large-Scale Land Acquisitions in Sub-Saharan Africa and Corporate Social. . .
141