University Canada West
Business 601: Business Environment, Ethics, & Strategy
Ethics, Stakeholder, & CSR Project Memorandum
NIKHIL CHHIBBER (2119718)
MBA – BUSI601 – ETHICS, CSR AND BUSINESS ENVIRONMENTAL ANALYSIS
Instructor: Jack Smith
To:
Jack Smith (CEO)
From:
Nikhil Chhibber
Date:
February 20, 2022
Subject: Mining Proposal and Recommendations
This memo is for Mr. Smith, who requested my opinion on the best strategy to take when
dealing with the parties affected by the new mining project. We'll begin by examining and
analysing the two stakeholder methods, Plantinex and DeBeers, which were brought to your
notice by your daughter, Jacqueline, who witnessed these two stakeholder approaches at a
prior mining conference. Platinex Inc, a mineral exploration company located in Toronto, made
the initial contact . Platinex had a dispute with the K.I first nations, who resided on their
traditional area. Platinex had the property on lease and all the legal rights to mine, but the one
thing they didn't consider was involving the K.I first nations. As a result, five K.I first nations
declared a moratorium, claiming that their community had been left in the dark about the
mining that had taken place. The K.I first nations made it plain that they were never opposed to
development; rather, they wanted to be informed about the plan and to participate in all
development operations as partners. This is a clear example of the business-society interaction
that Sexty has highlighted. The corporation then went on to deceive their investors by claiming
that they had received verbal approval from the indigenous peoples. Due to Platinex's illegal
behaviour, there were a number of peaceful protests around the drilling location afterwards. As
a result, Platinex filed a $10 billion lawsuit for the losses incurred as a result of the project's
delay. To answer that, the K.I first nations launched a counter-suit against the company and the
Ontario government, alleging that the Mining Act was illegal. This demonstrates that platinex's
actions were unethical and in violation of their business obligations. As a result, we will not
employ this strategy.
Looking at DeBeers' second approach and the Victor diamond mine, we learn that the first
diamond ore was discovered on the banks of the Attawapiskat River in 1987, and that since
then, DeBeers has worked diligently to obtain legal status and various permissions from
government regulatory agencies in order to begin their exploration and construction work.
DeBeers' next move was to contact with the indigenous first nations and Aboriginal groups
living in and around the region. DeBeers also attempted to establish a connection with the
communities and promised them an ethical partnership. They recognised the challenges that
the communities were facing and attempted to assist them. By doing so, DeBeers
demonstrated ethical behaviour toward the company. After engaging the Attawapiskat first
nations, DeBeers signed an MOU, which was followed up by Impact and Benefit Agreement
(IBA). The talks were a huge success, with 85 percent of the first countries voting in favour of
DeBeers, resulting in the signing of the IBA. The Attawapiskat first nations blocked the winter
route for 18 days in 2009, but the problem was quickly resolved via diplomacy and
communication. Every project will inevitably encounter obstacles, but we must always find a
method to resolve them and create a win-win situation for both parties, with the caveat that
the problem must be resolved ethically. "There could be variances in thinking and several other
things, but one must always endeavour to do the right thing and make out the difference
between right and wrong," Sexty says of approaches to ethical reasoning. I firmly feel that we
should adopt DeBeers' second method, which is more ethical and systematic, and in which
DeBeers has incorporated several Sexty principles, such as business integration to embrace
moral norms and satisfy stakeholder expectations. DeBeers has also attempted to balance his
business and discover community needs, which could only be accomplished by open and
honest dialogue.
We should take the second approach and try to implement those policies in our company to
avoid conflicts with stakeholders, which in our case are the Hul'qumi'num people. We need to
build a strong relationship with the community and involve them in our project so that they feel
important. We can provide funds to the chief and council to build a school, not as a trade, but
to assist them with their cause. We can also give jobs in the project for indigenous first nations,
as well as try to assist them with their other difficulties. We may apply DeBeers strategy by
providing our stakeholders appropriate notice and sufficient time to reply. The execution of the
IBA is a critical agreement that we must include in the project's early stages. Building a strong
connection with the community takes time, therefore it's preferable if we define joint goals
with the five first nations. This will allow us to focus on the objectives over time and develop a
constructive relationship. I believe a significant need to establish up a department for ethical
and CSR concerns, which will assist to develop a stronger relationship between the stakeholders
and the corporation. This department will assist us strengthen our morals and maintain a
healthy working environment. This department can conduct ethical assessments to determine
the level of ethics in each employee. Through this exercise, we can raise ethical awareness and
standardise ethical behaviour. All of these factors will influence our firm's decisions and assist
us in analysing the issues that our stakeholders face. Our company may maximise profits by
utilising society's resources by adhering to government regulations against abusive tactics,
which our department will assist in enforcing.
I would also suggest that your daughter Jacqueline lead this department, as I have noticed that
she is very interested in learning about CSR and ethical practices, and she is also concerned
about the society and its problems. She could be a valuable asset to the firm in terms of
communicating and establishing relationships with the community. I may serve as an adviser to
her, assisting her with strategic planning and providing advice on CSR concerns.
I would strongly advise Aventura Inc. to proceed with this project; however, there are a few
gaps to be filled first. First of all our firm must transform its mind-set from merely profit driven
to recognising and aiding the many stakeholders, much like Mr Smith regards his family is a vital
part of his business even the Hul’qumi’num community must be cared after with similar care
and compassion. Second, there must be an open line of contact with indigenous first nations
and local people; we must endeavour to understand their concerns and, most importantly,
convince them of the project's advantages. Even if a scenario of conflict emerges, we must deal
with in via discourse with the people. Matrix of Stakeholders Mapping is a strategy which
enables us to divide stakeholders into groups and then each group can be managed more
efficiently. As we've seen in both ways, having legal clearance and authorization to investigate
only goes so far; if you don't have the approval of the surrounding community, things may
quickly spiral out of control. I would also advise Mr. Jack Smith to speak directly with the
indigenous first nations, rather than going via the Minister of Mines and Resources, because
pressuring the communities may appear immoral, and this can later become a major issue. I
would also advise moving on with the IBA formulation, which is a critical and time-consuming
step. Based on my study, there are a few issues that need to be solved before we can move
forward with this project.