Corporate social responsibility: a journalist’s investigation

by Konrad Yakabuski

I can’t say I was fully satisfied with the outcome of “Gimme Smelter” because the situation behind the story was still unresolved when the piece was published. Indeed, it remains so. If I was satisfied with anything it was that I situated the debate in the broader context of social corporate responsibility.

Briefly, here is the backdrop for the piece.  Alcan is a Canadian icon. Although it recently became a foreign-owned company following its takeover by Rio Tinto, the Australian-British mining conglomerate, Alcan is in fact the Aluminum Company of Canada. Quebec’s Saguenay region would look very different without it. Since Alcan first built a smelter — and an entire town — in the Saguenay in the 1920s, a symbiotic relationship has existed between the company, the region and the Quebec government.
 
That relationship stems largely from the company’s dependence on water rights granted by the government to build hydroelectric generating stations that provide Alcan with the massive amounts of low-cost electricity it needs to smelt aluminum. The Quebec government has always tried to ensure that there is an overall benefit to Quebec society from granting Alcan these precious hydro rights. That benefit has stemmed from the jobs and other economic activity generated by the smelting operations.
 
So what if Alcan merely decided to stop producing aluminum (and all the jobs it creates) and sell to the highest bidder the electricity the government gave it the right to produce in the first place? It likely could never happen in Quebec. But it has been happening in British Columbia.
 
As a journalist interested in public policy, business-government relations and the growing field of corporate social responsibility, I became fascinated with the debate playing out in BC over Alcan’s Kitimat smelter. The company had engaged in a sophisticated public relations campaign that, while promising to build a bigger smelter in Kitimat, seemed aimed at preparing for an era when Alcan’s primary line of business in BC would not be making aluminum but selling electricity.
 
Access to Alcan’s top officials was not difficult to obtain for this story. It usually isn’t with huge multinationals that have sophisticated corporate communications departments. They are equipped for any question. The most challenging part of this piece was trying to understand exactly why Alcan was saying one thing but seemed to be doing something else. Also, trying to get to the root of the BC government’s laissez-faire position with regard to Alcan’s use of the water rights was not easy.
 
The article was admittedly a challenging read, given the complexity of the situation. But it was well read and well received, especially in policy circles. Several academics also expressed compliments. Lastly, it was gratifying to see the response from within the profession, as the piece was nominated for two National Magazine Awards – in both the Business and Politics category and Public Interest category.

As the story demonstrates, corporations — by the very nature of their fiduciary responsibilities to shareholders — cannot give precedence to social outcomes over profit-related ones. This is important to remember in weighing corporations’ claims to act in a socially responsible fashion.

Read “Gimme Smelter”