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Minister launches report into mining industry.

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JOHN HIGHFIELD: The Australian mining industry has today opened itself up to its critics, launching a landmark report which sets a new agenda of social, environmental and economic sustainability for the industry. Launched by the federal Environment Minister, Dr David Kemp, and the head of Western Mining Corporation, Hugh Morgan, the report is the first independent report card of its kind for Australian business, according to its promoters. And whilst it is being welcomed in mining circles, it is controversial because of its recommendations that the true costs of mining are considered above the basic economic benefit.


Business reporter Zoe Daniel, in Melbourne.


ZOE DANIEL: Former Australian Conservation Foundation boss, now academic, Tricia Caswell, summed up the unique meeting of minds that has produced this report for local and international consumption.


TRICIA CASWELL: When WMC managers approached me to join their environment advisory panel, in 1998, I laughed really wholeheartedly and replied, ‘you must be joking or mad.’


ZOE DANIEL: It is unusual for business to voluntarily open itself up for independent criticism but this 15-month process started with a mea culpa from the mining industry. It has been tainted by disasters like BHP’s Ok Tedi mine in Papua New Guinea, the public perception permanently scarred by images of rivers thick with tailings, and local fishermen with empty baskets.


Today’s report is part of the Worldwide Mining, Minerals and Sustainable Development Project, and calls for better communication between industry, government and community. It is said to be a landmark in the way the industry does business, and was launched by federal Environment Minister, David Kemp.


DAVID KEMP: Coming out of these tensions, if you like, and issues, we’ve got an industry which has really faced up to some tough questions. And unlike others who exist in less challenging environments, it hasn’t been able to avoid those tough questions, and it’s had the leadership to see that the right approach is to ask them and to seek to answer them.


ZOE DANIEL: The recommendations revolve around fairer distribution of costs and benefits to make sure communities get a lasting benefit from mining. The report recommends that mineral resources are revalued to take into account environmental and social costs.


Hugh Morgan, Chief Executive of WMC, says the recommendations are controversial but they are necessary.


HUGH MORGAN: Well, I think it is a landmark in the sense that we’ve been prepared, as an industry, to place ourselves in the hands of all of those who are not necessarily in our favour, to tell us what they think of us.


ZOE DANIEL: Do you agree with everything that is in it, yourself?


HUGH MORGAN:   As I mentioned, I certainly don’t agree with everything but I agree very strongly with the process. That is the really big change that is taking place in society whereas in the past we’ve been agreeable to either direction or dictate—that’s less so today. It is not just a question of ‘show me that it is right’ it is now a community that wants to become involved.


ZOE DANIEL: Which particular aspects of the report, do you think, will be most difficult to work through and implement?


HUGH MORGAN:   There are issues like there needs to be a fairer distribution of the rewards from mining. Well, that’s a pretty general statement. What we do is: we produce a product that is sold in an open marketplace—it’s fungible, it’s not distinguishable, it hasn’t got a brand name on it, so the idea of fairness needs some sort of definition.


ZOE DANIEL: There are logistical difficulties with these sorts of things, aren’t there, like the price of products, including the environmental and social costs? You mentioned that you work in a free market. How on earth do you make that work?


HUGH MORGAN:   Well, that’s a very good point. How do you make that work anywhere? I mean, that’s why I am not sure that the direction of that comment. What it’s really doing—it’s reflecting a desire about an outcome rather than providing the methodology by which that is achieved and, maybe, the way that is achieved is better through codes of conduct, through the protocols of environmental performance, the role of—in our context—peer pressure group from our associations or, more importantly, perhaps better endowment of regulatory authorities, particularly the mines department, to oversee as the landlord, the conduct of every mining operation—not big business but every mining operation.


JOHN HIGHFIELD: Hugh Morgan is the Chief Executive of Western Mining Corporation, and he was speaking in Melbourne this morning to our business reporter, Zoe Daniel.