Sustainability and CSR Impacts of Vale and BHP

This report compares the CSR and sustainability approaches of two mining companies- Vale and BHP. The purpose of this report is to understand how these companies are trying to set their CSR values to their stakeholders. The report compares the CSR and sustainability approaches of these two companies to get a better understanding of the facts.

Running head: BUSINESS, PLANET AND SOCIETY
Business, planet and society
Name of the Student
Name of the University
Authors note

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Executive summary
This is a report on the sustainability and corporate social responsibility impacts of two mining
companies- Vale and BHP. The purpose of this report is to understand how these companies
are trying to set their CSR values to their stakeholders. CSR is not only confined to the
philanthropic side of a business, but it has its profit side as well. Therefore, companies are
adopting sustainable business ideas that would give them competitive advantages. The report
compares the CSR and sustainability approaches of these two companies to get a better
understanding of the facts.

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Table of Contents
Introduction....................................................................................................................3
Business activities of Vale and BHS..............................................................................3
CSR approaches of these Companies.............................................................................4
Most relevant CSR Goals...............................................................................................6
Sustainability Phases......................................................................................................7
The extent of the stated Value reflection.......................................................................7
Reflection of understanding...........................................................................................8
Conclusion......................................................................................................................9
References....................................................................................................................10

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Introduction
The corporate social responsibility or CSR helps a company to create a positive
impact on the stakeholders and society by managing the business in a specific way. The CSR
cover in its context, the sustainability, environmental effects, social effects and ethics of the
organization. The companies are gaining competitive advantages through successful
implementation of CSR. Investors are showing their interest in the companies that have a
high CSR impact. Therefore, the idea of CSR does not confine itself in mere philanthropic
aspects. In this report, there would be a discussion and comparison of the CSR operations of
two companies- Vale Mining and BHP.
Business activities of Vale and BHS
Vale S.A. is a multinational company that is engaged in mining and metals. This
company is one of the renowned names in logistics operations in Brazil. Vale is the highest
producer of nickel and iron ore in the world. The company was formerly naked as Companhia
Vale do Rio Doce, it changed its name in 2007. Other than that, the company also has its
business in the production of kaolin, manganese, cobalt, copper, potash, bauxite and,
ferroalloys. The company is continuously expanding its scope of business by entering into the
markets like developing railroads, ships, ports and hydroelectricity plants. The company
faced massive dam failures in 2015 and 2019. The 2014 crash was in Mariana, and the 2019
one was Brumadinho. The 2019 disaster of Brumadinho has compelled the company to lose
almost 25 per cent of the value of its stock markets. This also caused loss of licensee for the
company to operate about eight tailing dams at Minas Gerais.
BHP is a multinational company that deals with metals, mining and petroleum. This
company was formerly known as BHP Billiton. The company is a dual-listed public company

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and have its headquarters in Australia and the United Kingdom. This company was founded
in 1885 in South wales. BHP was ranked as the largest mining company in the world is
respect to its market capitalization. The growth of the company almost tripled in between the
year 2004 and 2012. The company is a dual-listed company as it is listed in both ASX and
LSE. The reason behind such listing is that the company was formed as a merger of Anglo-
Dutch Billiton plc and Australian Broken Hill Proprietary Company Limited (BHP). The
company has faced challenges as it was involved in the worst disaster ever happen in Minas
Gerais. This environmental disaster is known as “Bento Rodrigues tailings dam collapse”. In
2017, the BHP Billiton started to rebrand this company as BHP in Australia and the world. It
sold off its US shale gas and oil business in 2017. This company has four operational unit-
petroleum, coal, copper and iron ore.
Issues dealt by the companies
Vale and HSP both publish their CSR report each year describing their approaches to
maintain positive social and environmental impacts. Vale’s CSR report focuses on the
development of territorial socio-economic balance and the maintenance of biodiversity,
natural resources and life. This is stated in the CSR reports of the company that it has tried to
involve in the actions that have scopes of developing positive social and environmental
impact. The company has made investments in the improvement of the technology that helps
in environmental control systems (Williams, 2015). Company has published the guidelines
and policies that are used to ensure the sustainable development of its business. The decisions
making the process of the company is designed for sustainability. According to the
company's unsustainability report, the company has environmental issues at the heart of the
CSR policies. Some of these are-
 The company faced problems in structuring their policies for sustainable

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development.
 The employees of the organizations were failing to maintain their
responsibility towards environment and community.
 The equipment and technological interventions to improve the environmental
aspects of CSR needed to be developed in every stage of operations.
 The dam failures and waste management policies caused some discrepancies
between the organization and the community people.
 The company got some notices from government regarding their import and
export issues.
Maintainance of long-term value and sustainable performance to achieve social value
is at the heart of BHP’s CSR approach (Laszlo & Zhexembayeva, 2017). The company states
that sustainability is at the heart of its operations. Unlike Vale mining, BHP is more
concerned about the social aspects of CSR. This company gives importance to the employees
and communities bonding.
 Internal structure of the company was not quite static and ethical. Some of the
employees accused the company of having biased and favored work culture.
 Development of territorial communities is an aspect of any mining
orgnisation. This company was not aware of the responsibility and have
minimal interactions with the indigenous people of their work territory.
 The company also addresses the environmental sustainability issues in its CSR
reports. The company have developed a management process where the
control of material risks in the phases of the business is done with
responsibility (Story & Neves, 2015). This company demands to have systems
for identifying, assessing and controlling the environmental risks of its

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operations.
Most relevant SD Goals
Both of the companies have failed operations that have cast deep impact in their
business and CSR aspects. One must not forget that the type of business venture these
companies are operating, that involves various environmental risks (Wang et al. 2016).
Therefore, the relevancy of the CSR contexts of these companies is massive.
The authorities of Vale announces that they are taking lessons from the tragedy that
has happened in 2019 and are committed to the betterment of the environment and their
people. The companies most relevant SDG are related to environmental sustainability,
industry innovation and infrastructural, responsible consumption and production and good
health and well being of the people. The company has invested in the recovery actions for
their people in 2019. Their total investment, according to the company report, is R$ 1.4
billion. This is directed for the civil defence, fire services, medicines and other logistics. This
company also has invested in developing the technology for lesser usage of dams in their
mining projects to avoid further accidents. In the environmental sustainability aspects, the
company is working for recycling the resources used in the operations. Like they are aiming
to reuse almost 83% of the water that is used in production — reducing of CO2 emissions
and investment of US $5 million in environmental purposes.
BHP is involved in more than one social development projects in the territorial parts
of Brazil. The most important sustainable goals of this company are related to decent work
and community growth, sustainable communities and cities, life on land, reduced inequality,
workplace equality. The CSR goal of this company has “zero tolerance” for child labour and
workplace discrimination (McWilliams, 2015). What makes the CSR policy of this company
different from that of Vale is that the company believes in increasing sustainable operations

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through social and environmental concerns of the stakeholders. The company buy their
materials from green companies for maintaining decent economic development. The
company has invested its time and money in indigenous people’s life development and
children education. Along with the environmental risk-reducing, the company direct its
policies to give the employees and community a better life prospect through their
involvements.
Sustainability Phases
The Vale is in the Compliance and Risk reduction phase of sustainability phase
whereas, the BHP is one step higher and is staying in Efficiency phase.
Vale has been working on reducing the environmental risks that are involved in their
business procedure. This company have to work with more competence to achieve
competence in the CSR values. The failures in the management of dams have cast a negative
impact on the company’s reputation (Ali, Frynas & Mahmood, 2017). The company is
investing in the development of technologies for reducing environmental risks. The emphasis
is given on the legal requirements for industrial relations.
In contrary, the company BHP has been able to take its place among the top "20 companies
in Australia Listed Companies" regarding its CSR capabilities. It could be seen that the
company has achieved competency to manage its CSR and sustainability issues wisely. It has
invested a good amount in public relations and environmental risk reductions. This has given
this company advantages to be different from the companies in the industry. The mining
industry generally does not have a high reputation as environmental and employee health and
safety risks are high in this business. In spite of that, the company has managed to have its
CSR reputations intact. Therefore, it could be said the company has been able to reach the
phase of efficiency in CSR implementation.

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The extent of the stated Value reflection
Vale has started to work responsibly after the 2019 dam failures. It is investing in the
development of strong safety structures for the employees and people. It has certainly worked
for community development and reducing environmental risks. The reports that are published
by the company has extended versions of the values they sated. The company is trying to
reduce the risk of its environmental aspects. But it has not been successful in solving all their
sustainability problems (Lim & Greenwood, 2017). Vale has already lost much of its
reputation for two major dam failures. The company was not quite responsive to its CSR
duties at first. Now it has developed the plans but is not being able to complete all the
promises it has done for environmental development. It has made some improvements in its
social responsibilities in CSR aspects.
On the other hand, BHP is quite high in its CSR index. The company is regularly
improving its sustainability contexts. The company has been able to maintain its CSR
reputation in spite of some bad history. This company uses a number of methods to make
sure that their CSR is active and explicit. The company conducts regular assessment of its
CSR performance. BHP holds an annual FCR or Forum on Corporate Social Responsibility.
In this forum, all the representatives of the company came together to discuss the
environmental and social issues that are relevant to BHP. The company continuously invests
in community projects (Grayson & Hodges, 2017). It compares its expenses on the
community against MDG to make the measuring tangible.
Reflection of understanding
The project has helped me to understand the context of CSR and how that influences a
business' context. Both of the companies are from the same industry but have a different
approach for their CSR aspects. The difference between the approaches is the result of their

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sustainability management programs. I have understood that a company sets its sustainability
approaches according to the nature of operation, requirements and developmental goals set.
Vale is more concern of correcting and reducing the environmental risks while BHP is
attempting to work more with the public relations aspects. Both of the companies have faced
huge failures in the past and are trying to improve their social and environmental impacts.
The extent that the companies are able to achieve in their sustainability programs is also
examined by me. All of this gives an overview of the topic. This assignment was done being
a part of a group. Working with a group gives the experience of team and time management.
While working on this report, I have able to explore various parts of the CSR approaches of
these two companies and try to compare and contrast them. The report writing and
presentation rules and regulations are also a part of my learning in this report.
Conclusion
This report states the CSR and sustainability approaches of two different organization
in the same industry. The context of sustainability is one of the central themes of any
business organization. CSR takes into account the environmental and social impact of an
organization’s operations. The two companies that are taken for this report have attempted
different approach for their business sustainability. The relevancy of the CSR and
sustainability goals lies in the fact of how the company is mapping their social
responsibilities. Through this report, the readers could have an overview of how sustainability
is maintained by these two companies and to what extent they are able to keep their value
intact in respect of CSR and sustainability.

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References
Grayson, D., & Hodges, A. (2017). Corporate social opportunity!: Seven steps to make
corporate social responsibility work for your business. Routledge.
Lim, J. S., & Greenwood, C. A. (2017). Communicating corporate social responsibility
(CSR): Stakeholder responsiveness and engagement strategy to achieve CSR goals.
Public Relations Review, 43(4), 768-776.
Ali, W., Frynas, J. G., & Mahmood, Z. (2017). Determinants of corporate social
responsibility (CSR) disclosure in developed and developing countries: A literature
review. Corporate Social Responsibility and Environmental Management, 24(4), 273-
294.
McWilliams, A. (2015). Corporate social responsibility. Wiley encyclopedia of management,
1-4.
Wang, H., Tong, L., Takeuchi, R., & George, G. (2016). Corporate social responsibility: An
overview and new research directions: Thematic issue on corporate social
responsibility.
The story, J., & Neves, P. (2015). When corporate social responsibility (CSR) increases
performance: exploring the role of intrinsic and extrinsic CSR attribution. Business
Ethics: A European Review, 24(2), 111-124.
Laszlo, C., & Zhexembayeva, N. (2017). Embedded sustainability. In Embedded
Sustainability (pp. 116-140). Routledge.
Williams, E. (2015). Green giants: How smart companies turn sustainability into billion-
dollar businesses. Amacom.
vale.com (2019), Sustainability Report, retrieved from:
http://www.vale.com/EN/investors/information-market/annual-reports/sustainability-

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reports/Pages/default.aspx
bhp.com (2019), sustainability, retrieved from:
https://www.bhp.com/our-approach/sustainability
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