Been the involvement of local stakeholders and building strong relationships is a strategic imperative for multinational companies in the often politically charged mining, oil and gas sector. For BHP Billiton, the world’s second largest mining company, has its Tintaya copper mine in Peru has long been a source of intense conflict. The mine – which was initially owned and managed by the Peruvian State, and later by BHP Billiton – stands on a plot of land expropriated from local small farmers. In 2000, to defray the loss … Read more »

Been the involvement of local stakeholders and building strong relationships is a strategic imperative for multinational companies in the often politically charged mining, oil and gas sector. For BHP Billiton, the world’s second largest mining company, has its Tintaya copper mine in Peru has long been a source of intense conflict. The mine – which was initially owned and managed by the Peruvian State, and later by BHP Billiton – stands on a plot of land expropriated from local small farmers. In 2000, to contest the loss of land, mining-related environmental degradation and allegations of human rights violations, a coalition of five indigenous communities into an alliance with a group of national and international NGOs (non-governmental organizations), their case against BHP build Billiton and pursue it directly with the company’s Australian headquarters. The result of these efforts was announced the beginning of a unique corporate culture community negotiation process as Tintaya Dialogue table. Billiton in December 2004, after three years of negotiations, BHP and the five communities signed an agreement to compensate families for lost land and livelihoods and the creation of a local environmental monitoring team, and Community Development Fund. However, just as the company resolves a conflict, another group of local players with new demands results – requires that this time not to take the company in a position. The conflict with this new group culminates in a violent takeover of the mine in May 2005, followed by BHP Billiton personnel forced shut down operations, leaving mine, and develop a new strategy for winning back local support.
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from
Brooke Barton,
Ezequiel Reficco,
V. Kasturi Rangan
Source: Harvard Business School
2 pages.
Publication Date: Sep 13, in 2006. Prod #: 507030-PDF-ENG
Corporate Responsibility & Community Engagement at the Tintaya copper mine (B) HBR case solution