By Chelsea Hodgkins, Senior EV Auto Supply Chain Policy Advocate at Public Citizen
The Consolidated Mining Standard Initiative (CMSI) closed its last public consultation. The governance model, already finalized, was not included.
The final governance model creates a corporate-led Board that gives industry disproportionate power over important decisions like standard updates, the handling of rights-holder filed grievances, and transparency around mining company practices.
Civil society and Indigenous Peoples continue to heavily criticise the CMSI for how it will drive a sector-wide race to the bottom. But without a meaningful process for feedback and integrating substantive changes, the governance model will entrench corporate control by limiting the influence of affected rightsholders and civil society.
Board Members are not elected or responsible to constituencies
Constituent-elected Boards are fundamental to a credible multi-stakeholder initiative (MSI). They hold decision makers accountable to their bases and safeguard against any one group disproportionately controlling or corrupting the MSI’s functioning. The Extractive Industries Transparency Initiative (EITI) and the Initiative for Responsible Mining Assurance (IRMA) both have constituent-elected Boards.
The CMSI disregards this democratized decision-making. Instead, the first Board will be composed of current members of Copper Mark’s Board and new members selected behind closed doors by two CMSI Advisory Groups.[1] The CMSI has said it intends to establish a Governance Committee, but there are no announcements about creating constituency-based Board member elections.
And civil society did not have a fair say. The executives designing the CMSI backtracked on their public communications to hold two public consultations on the governance model. They cancelled opportunities for further public input during the final consultation.
The governance model is the most important part of the CMSI. This rollback—taken despite the CMSI’s own consultation report showing low participation from frontline communities and rights-holders in the first public consultation— removed equitable access for the groups that will be most impacted by the standard to influence the decision-making body.
This demonstrates the CMSI executives’ commitment to the mining industry’s interests above all other stakeholders.
“Unified Voice” Rule and Lack of Transparency
And this is not all. Under their fiduciary responsibilities, CMSI Board members must “speak with a unified voice when representing the Legal Entity to the community.”[2]
This amounts to a harmful gag rule on Board members’ ability to communicate freely and openly. It also limits the transparency essential for affected stakeholders and the broader public to hold their so-called representatives accountable to their needs.
For comparison, IRMA explicitly acknowledges that stakeholders may “not always agree” and even allows public airing of disagreements, seeing value in openly addressing differences.[3]
CMSI’s approach disallows any public minority opinions and closes space for open debate so essential for a credible multi-stakeholder process.
Disproportionate representation and veto power for the mining industry
The CMSI Board secures industry’s place at the table and power in decisions through representation and voting rules.
Mining companies and downstream actors have half of all voting seats (8 out of 16).[4]In contrast, the representation of local communities, Indigenous Peoples, workers, and NGOs is not equal in numbers or as clearly defined.
Of the eight remaining voting seats, one is guaranteed for Indigenous Peoples, one for labor, one for social/human rights interests and one for the environment.[5]
The remaining four voting seats are vaguely defined to be split between international NGOs, multi-lateral organisations, multistakeholder initiatives, academics, and members from groups impacted by activities across other parts of the mineral value chain.[6]
With this set up, Indigenous Peoples and major segments of civil society are only guaranteed one vote each, compared to four for the mining industry. Civil society and Indigenous Peoples will have to build Coalition across groups to advance their interests.
In addition, the voting structure gives the mining industry near-veto power: to pass any decision requires a 70% majority. The mining industry alone has 25% of the votes.
Therefore, to pass any proposal over the industry’s objection, everyone else, including downstream industries, must be virtually unanimous. On its face, this mimics other standards, but in practice, just two dissenters in a given group can block any material improvements to the standard.
Because industry is typically united in its interests and already holds so much power—not just the mining industry, but downstream industries as well—this voting system is effectively rigged in their favor. Just a few industry votes can block any attempt to improve the standard, ensuring that the current system—which favors them—remains firmly in place.
The design ultimately protects the status quo favored by the mining sector: diluted representation of impacted people and voting rules that require near unanimity across groups, something far easier for industry to achieve than a fragmented civil society.
Conclusion
As it is now, the CMSI is not a trustworthy standard that will support strong due diligence or improved outcomes for mining-affected communities, workers, and Indigenous Peoples. The CMSI has largely ignored the years of advocacy, analysis, and efforts by civil society to drive real improvements to the standard and the governance model.
In spite of concerns raised by stakeholders, CMSI executives are finalizing a corporate board to masquerade as a multistakeholder governance system. The governance board doesn’t ensure fair and adequate representation for rightsholders. Despite any future progress that may be made in the content of the standard, the governance model makes sure power will remain in the hands of industry at the expense of workers and communities. As the standard is currently written, the CMSI is not a legitimate multistakeholder initiative, nor will it respond to concerns raised as such.