A Mindanao-wide alliance of energy generation, distribution, and transmission companies signed a memorandum of understanding (MOU) with other stakeholders to promote “conflict-sensitive” business practices in Mindanao energy sector.
Aside from the Mindanao electric power alliance (Mepa) represented by its external vice president, Manuel M. Orig, other stakeholders signatory to the MOU inked last February 7 are the Mindanao business council (MinBC), a Mindanao-wide business organization represented by its chairperson, Vicente T. Lao, and International Alert, an international peace building organization represented by its country director, Francisco J. Lara, Jr.
The MOU signing was witnessed by United Kingdom Ambassador Stephen Lillie, Mindanao Development Authority chairperson Lualhati R. Antonino and Davao City Council committee on energy chair Pilar C. Braga.
The salient area of the MOU is the Mepa’s agreement with other parties “to be guided” by the so-called “red flags” to avoid participation in human rights abuses, prevent violent conflict, and “ensure accountability in cases where they are liable.”
Red flags
The “red flags” include expelling people from their communities, forcing people to work, handling questionable assets, engaging abusive security forces, trading goods in violation of international sactions, allowing use of company assets for abuses and other crimes, providing the means to kill and financing local and international crimes.
“The threat or use of violence to force people out of their communities can be a crime under international law. A company may face liability if it has gained access to the site on which it operates, where it builds infrastructure, or where it explores for natural resources, through forced displacement,” said the MOU.
“The signing of MoU is in effect an affirmation of Mepa to comply with red flags principles,” said Orig, adding that part of complying is facing the consequences when you don’t comply.
Lara said red flags set warnings of heightened risks and the next step is to get to a process for companies to make mechanisms. Meanwhile, Orig said Mepa is not yet done with mechanisms to enforce the principles.
Lao said that compliance with red flags is a company’s share of corporate social responsibility (CSR), saying “these should not be viewed as restrictions but good corporate social responsibility.”
Ma. Teresa R. Alegrio, member of Mepa board of trustees, said there is a need to involve multi-stakeholders in addressing issues of poverty and environment, among others. “We need to engage our stakeholders from the start of the project, not just for social acceptance.”
Lao said conflicts will arise when communities are deprived of living decent lives. Therefore, he continued, additional investment must set in; reliable power supply is an imperative, as well as development programs. “Conflicts will be resolved if all stakeholders are properly informed.”
Commitment
Mepa, specifically, has committed to facilitate cooperation and mutual assistance among its members from the energy sector and local governments in Mindanao to curb the power crises, avoid violent conflict, and attract responsible and sustainable investments in power generation.
Mepa was established through the auspices of MinBC to facilitate cooperation and mutual assistance among stakeholders from the energy sector and local governments in Mindanao to curb the power crises, avoid violent conflict, and attract responsible and sustainable investments in power generation.
In 2009, MinBC signed an MOU with International Alert to “alert” companies to some critical “red flags”, or a set of national and international liability risks that companies, especially those engaged in the energy, extractive, and agribusiness sectors, may face in the course of their operations and investments in areas of crisis and conflict.
MinBC and Alert, together with other peace builders from various regions in Mindanao, meet regularly as a Mindanao Multi-stakeholders Group (MMG) to analyse political, social, and economic dimensions of conflict and underdevelopment in Mindanao. The analysis is then used to provide inputs into advocacies of MMG members and its networks.
The MOU signing last February 7 expands the “scope of buy-in to the red flags” amongst the energy sector, and strengthens the partnership among Alert, MinBC, and the UK Embassy to promote inclusive and conflict sensitive business conduct in Mindanao.
Economic dividends
Nikki Philline C. de la Rosa, programme coordinator of International Alert, said the entry of extractive, energy, and agribusiness companies in rural areas across the Philippines creates both opportunities and risks for improving the living standards of the poor and excluded in our society and the ability of local authorities to govern local economies.
“The opportunities to land new jobs, learn new skills, and engage in new livelihoods, and for local government units (LGUs) to enhance their revenue sources, are some of the economic dividends that can emerge from the entry of these investments,” she said.
“This is reinforced by the fact that most public lands, including those that were recently declared as ancestral land (CADTs), have generated few capital investments, agricultural improvements, and development initiatives. The opportunity to generate fresh investments and revenues are also central to the agenda of strengthening local states and their ability to enhance public welfare,” she added.
Liability risks
On the other hand, Dela Rosa pointed out, there are liability risks that “resonate in the eruption of violence and conflict in the areas where companies operate; the increased incidence of illegal ejection or displacement of communities; the inducement of graft and corruption; and, the use of abusive security forces and the provision of the means to kill.”
“Some of these issues have surfaced in several disputes between companies and communities in the mining sector. Oftentimes, rival communities have been lured into disadvantageous business arrangements with the collusion of local government executives and politicians,” she said.
Dela Rosa said the MOU signals a first step in the development of partnerships between local communities, local and national government, and private sector firms in “inclusive and conflict sensitive economic governance.”
“The aim is to deepen understanding of inclusive and conflict-sensitive business practices among local and international companies operating in the Philippines, and to specifically highlight the role of economic actors in bringing about peace and development,” she said. [Lorie Ann Cascaro and Greg G. Deligero]
