A failed strategy of using voluntary codes of conduct by the global mining industry

Abstract

Purpose: This paper aims to focus on an analysis of industry‐based voluntary codes of conduct in the international arena with special reference to the operations of the global mining industry.Design/methodology/approach: The paper examines the working of the mining industry's voluntary code of conduct, i.e. International Council on Mining and Metals (ICMM) sustainable development framework. The paper develops an analytical framework, which sets forth some of the necessary preconditions that must be met for such a code to be credible and effective in meeting societal.Findings: An in‐depth analysis of the data produced by ICMM conclusively proved that the industry had substantially failed in meeting any of its objectives in terms of adequacy of principles, establishment and implementation of the framework, allocation of sufficient financial and human resources, and independent external monitoring for compliance verification. The result is that despite spending millions of dollars, industry has failed to gain any public credibility. Instead, industry's code effort is viewed with disdain as a largely public relations exercise.Originality/value: The paper provides important lessons and specific guidelines that can help companies and industries in creating meaningful and effective codes of conduct. A failure to do so would exacerbate the problem of public distrust in the industry and would lead to greater restraints on the industry's modus operandi and opportunities for growth and profitability.