The Social License to Operate as a Tool to Promote Sustainability …
411
However, this approach had deleterious long-term effects: it increased inequalities and economic dependence on mining, and weakened civil society organization
by reinforcing asymmetries in their relationship with the company. Vale’s privatization increased social tensions, as social benefits and improvements were no longer
promoted or supported by Vale. Frequent protests interrupted production and logistics
due to social dissatisfaction (Hoelscher and Rustad 2019).
From 2011 on, the company Hydro took ownership of Vale and changed the
previous CSR paradigms, incorporating human rights topics into business agenda.
It sought to improve its relationship with local stakeholders, building legitimacy
and deepening community engagement through long-term CSR strategies. However,
Hydro faces resistance from local community, because they were used to short-term
benefits provided by the paternalist approach of the past, whereas the negative environmental impacts and social conflicts remain in collective memory. Hoelscher and
Rustad (2019) indicate that SLO strategies need to acknowledge the past experiences
and create a common shared vision with the community.
The mining projects in the municipalities of Parauapebas and Canaã dos Carajás,
in Pará state, are controlled by Vale (2012). Hoelscher and Rustad (2019) emphasized
it is important to analyze the history and dynamics of the companies and properly
understand the characteristics of the municipalities, to correct mistakes from the past
and shape better futures.
3 Methodology
3.1 Location
This study was conducted in the municipalities of Parauapebas and Canaã dos
Carajás, located in the state of Pará, region of Carajás (Fig. 1). For some decades,
both municipalities were small farming settlements in the municipality of Marabá.
Mining exploration in the 1980s boosted migrations to the region, and Parauapebas
was founded in 1988. Its mines explore copper, manganese, among others. Canaã
dos Carajás was founded in 1994, and nowadays hosts the largest iron ore mine in the
world (Cabral et al. 2011; Duddu 2018). The estimated population in Parauapebas
is 208,273 inhabitants, and 37,085 in Canaã dos Carajás (IBGE).
The huge mining production in the municipalities is reflected in their tax collection. Parauapebas and Canaã dos Carajás are the greatest mining tax collectors in
Brazil: US$244,701,241.25 and US$149,442,005.00 in 2019, respectively (ANM
2020). However, these municipalities are not well positioned in the FIRJAN Index.
Created and monitored by the Federation of Industries of Rio de Janeiro, such an
index evaluates yearly the standards of living in every single Brazilian municipality,
assessing the following sectors: jobs and income, education and health. In 2016,
Parauapebas, Canaã dos Carajás were in 1318th and 2503rd position on the Brazilian
FIRJAN ranking, respectively (FIRJAN 2020).
411
However, this approach had deleterious long-term effects: it increased inequalities and economic dependence on mining, and weakened civil society organization
by reinforcing asymmetries in their relationship with the company. Vale’s privatization increased social tensions, as social benefits and improvements were no longer
promoted or supported by Vale. Frequent protests interrupted production and logistics
due to social dissatisfaction (Hoelscher and Rustad 2019).
From 2011 on, the company Hydro took ownership of Vale and changed the
previous CSR paradigms, incorporating human rights topics into business agenda.
It sought to improve its relationship with local stakeholders, building legitimacy
and deepening community engagement through long-term CSR strategies. However,
Hydro faces resistance from local community, because they were used to short-term
benefits provided by the paternalist approach of the past, whereas the negative environmental impacts and social conflicts remain in collective memory. Hoelscher and
Rustad (2019) indicate that SLO strategies need to acknowledge the past experiences
and create a common shared vision with the community.
The mining projects in the municipalities of Parauapebas and Canaã dos Carajás,
in Pará state, are controlled by Vale (2012). Hoelscher and Rustad (2019) emphasized
it is important to analyze the history and dynamics of the companies and properly
understand the characteristics of the municipalities, to correct mistakes from the past
and shape better futures.
3 Methodology
3.1 Location
This study was conducted in the municipalities of Parauapebas and Canaã dos
Carajás, located in the state of Pará, region of Carajás (Fig. 1). For some decades,
both municipalities were small farming settlements in the municipality of Marabá.
Mining exploration in the 1980s boosted migrations to the region, and Parauapebas
was founded in 1988. Its mines explore copper, manganese, among others. Canaã
dos Carajás was founded in 1994, and nowadays hosts the largest iron ore mine in the
world (Cabral et al. 2011; Duddu 2018). The estimated population in Parauapebas
is 208,273 inhabitants, and 37,085 in Canaã dos Carajás (IBGE).
The huge mining production in the municipalities is reflected in their tax collection. Parauapebas and Canaã dos Carajás are the greatest mining tax collectors in
Brazil: US$244,701,241.25 and US$149,442,005.00 in 2019, respectively (ANM
2020). However, these municipalities are not well positioned in the FIRJAN Index.
Created and monitored by the Federation of Industries of Rio de Janeiro, such an
index evaluates yearly the standards of living in every single Brazilian municipality,
assessing the following sectors: jobs and income, education and health. In 2016,
Parauapebas, Canaã dos Carajás were in 1318th and 2503rd position on the Brazilian
FIRJAN ranking, respectively (FIRJAN 2020).