Lessons learned: Torex Gold’s evolving CSR strategy in a complex operating environment

2019

Bernarda Elizalde-Andrews, Torex Gold; Mark Thorpe, Torex Gold

Torex Gold operates the El Limon Guajes (ELG) Gold Mine in the State of Guerrero Mexico. The area around the mine is characterized by modest economic development, challenging security, and low levels of education. The mine poured its first gold in December 2015. Up to 99% of the workforce was Mexican, from which 50% came from within the six local stakeholder communities. Torex acquired the mine in 2009 following a community blockade during the exploration phase that stopped the work of the previous owner.  Within Guerrero, blockades are a common way to seek attention from the government. During the construction phase, Torex experienced over a dozen blockades, mostly short-term with limited effect on the construction. Following the start of operations, the threat of blockades continued, and the local communities viewed Torex as a replacement of the government for the provision of local services. The paper presents the changing approach to community support as Torex worked to move out of the center of the development circle. In 2018, Torex began the development of Community Development Agreements (CDAs) designed to link the success of the communities to the success of the mine. These agreements are linked to continued access to the ELG mine’s facilities, reduce ad-hoc requests for support from the community, strengthen the local communities’ decision-making process. The communities work with the ELG mine’s CSR team to define the projects and plan for the year of the CDAs, so providing the communities control over their budget and predictable budget costs for the ELG mine. Torex continues to consistently implement the CDAs with a high level of support from both site and corporate teams. There is a good faith effort on the part of the community and their leaders that is linked to increased transparency.
Keywords: CSR, strategy, blockade, Community Development Agreement, local communities, economic development
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