This post introduces Lynda Hubert Ta and Bonnie Campbell’s recently published The Extractive Industries and Society article, “Environmental protection in Madagascar: Biodiversity offsetting in the mining sector as a corporate social responsibility strategy.”
According to the most recent version of the International Union for Conservation of Nature (IUCN) Red List of Threatened Species, Madagascar has the largest number of threatened species (3,747) in the world, ahead of Ecuador (2,692 species), Brazil (2,229 species), Indonesia (2,282 species) and Malaysia (2,090 species).1
Madagascar is home to 2,897 threatened plant species, 133 mammals, 37 birds, 139 reptiles, 145 amphibians, 112 fish, 35 molluscs, 248 other invertebrates, and one species of fungi.
Among the main threats to Madagascar’s rich biodiversity and, therefore, to the traditions and well-being of the Malagasy population, closely linked to the resources of this biodiversity, are deforestation, climate change, and extractive activities.
Among the main threats to Madagascar’s rich biodiversity and, therefore, to the traditions and well-being of the Malagasy population, closely linked to the resources of this biodiversity, are deforestation, climate change, and extractive activities. Our research focuses on the latter.
While Madagascar’s major industrial mining projects have propelled the country into world class mining, they have had negative impacts on thousands of hectares of forest which are home to several threatened species and endemic species. Companies have responded by introducing strategies to compensate loss in biodiversity or “biodiversity offsets.”
Are current strategies capable of preventing the decline in biodiversity and who in the end is responsible?
These are the questions that we had in mind when we wrote the article for The Extractive Industries and Society. Regarding the first, we argue that the problem resides not only in the strategy of biodiversity offsets but in the liberalised mining model of which it is part. Our research draws attention to the importance of historical perspective and the far-reaching process of liberalisation introduced under the auspices of the international financial institutions as of the 1980s and 1990s in the mining sector of many African countries.
Among the consequences of this process have been State retrenchment, a reduction of State sovereignty over natural resources and the transfer of what were previously considered State functions and responsibilities to private operators. These include service delivery, rule setting and implementation, and security. The result has led to “governance gaps” and to the blurring of responsibilities among the various actors present.
In contexts of governments’ weakened capacity or willingness to enforce their own regulations, of the disappointing contribution of the extractive sector to local and national development, and severe environmental impacts, mining companies have increasingly faced problems of legitimacy for their activities. In response, they have adopted strategies of “corporate social responsibility” (CSR) to gain social license to operate. However, in situations of highly asymmetrical power relations between companies and communities and companies and States, it is far from assured that such voluntary measures will bring the legitimacy sought after by companies.
Among responses, biodiversity offsets, which may be seen as a CSR strategy, are increasingly popular among mining companies operating in countries such as Madagascar. They entail important social and environmental impacts however, which merit far greater attention. Our article points to serious reservations in the literature concerning, for example, the basis on which “compensation” is evaluated.
Biodiversity has emerged and evolved in complex historical, geographical, and climatic contexts, making each element unique.
As noted in our article for The Extractive Industries and Society: “Biodiversity has emerged and evolved in complex historical, geographical, and climatic contexts, making each element unique. Two sites are therefore not comparable in terms of biodiversity, especially if they are far apart. The criteria to calculate the offset (what dimension of biodiversity is to be assessed) and the indicators used (which measurement approach should be adopted) are not clearly established. Consequently, it is difficult to estimate future environmental gains precisely or know with certainty whether the benefits of one zone of conservation will eventually equal a mining site’s loss in biodiversity.”2
Moreover, the creation of strict conservation areas by companies can have negative social impacts and lead to human rights violations when local communities are prevented from accessing their lands which become monitored by companies using the substantial means available to them.
Strategies of biodiversity offsets clearly merit more careful scrutiny.
Who is responsible?
The mining model in place has entailed the “selective absence” of the State from the sector. However, because of the commitments the State has made by signing international environmental instruments and incorporating these into domestic law, the State, not private companies, has the obligation to protect biodiversity. The State is legally responsible for managing protected areas and legally accountable for decisions concerning respect for international, regional, and national commitments.
Though companies have become actors in biodiversity protection through their role in creating, financing, and managing offset conservation areas, they cannot be held accountable for voluntary initiatives as these are outside the scope of environmental laws and have their own institutional arrangements. This creates problems for oversight. Among possible results, States no longer fulfil their responsibilities towards their own populations who are largely excluded from discussions concerning the strategies pursued.
At present, the international community is actively attempting to identify solutions to halt biodiversity loss across the globe. The measures proposed however, appear to introduce additional confusion, notably concerning the distribution of the roles and responsibilities of the various actors, whether public or private. At the Fifteenth meeting of the Conference of the Parties (COP 15) on the Convention on Biological Diversity (CBD) held in Montreal, December 7-19, 2022, governments from around the world announced their intention to give an important place to the voluntary commitment of companies, notably in terms of self-regulation and financing of the protection of biodiversity. The resulting Global Biodiversity Framework includes in its Target 19(d), the objective of “[s]timulating innovative schemes such as […] biodiversity offsets […].”
In Montreal, as a party to the CBD, Madagascar committed to complying to the objectives of the Global Framework, therefore committing not only to introduce legal and public policy measures with a view of eliminating or at least reducing the threats which weigh on the biodiversity on its territory but also, to favour voluntary mechanisms for the compensation of biodiversity by private actors to finance the protection of this biodiversity.
In the present context in which the State of Madagascar is confronted with ambiguities concerning its role in the protection of biodiversity, for which private actors, notably mining companies, are recognised to have an increased role including the introduction of voluntary compensations for biodiversity loss, a closer examination of these issues in the country concerned appeared timely. The relevance of our study is also underlined by the fact that in 2023 the country negotiated the renewal of a major mining agreement setting out what are considered “sustainable” and “responsible” activities, with an important mining entity which uses biodiversity offsets.
The problems can be identified, measures proposed globally in international Forums, but shared responsibilities are rarely identified.
Beyond the fact that our study raises pressing questions concerning the current shortcomings of biodiversity protection and the need for independent, critical evaluations of the measures proposed, it also raises issues at several other levels.
What is a stake is the confrontation and difficult of reconciliation of shorter-term perspectives of resource extraction which focus on profitability, accompanied by strategies to compensate, or mask longer-term irreversible negative impacts, as opposed to longer-term intergenerational perspectives in which value is attributed to the wealth of cultural heritage of the affected populations which is inseparable from that of biodiversity. Behind these issues are asymmetrical power relations which are rarely addressed in the arenas where these challenges are discussed, nor taken into account in the strategies put forward in the name of the protection of biodiversity. The populations who suffer the brunt of the consequences of mining, notably biodiversity loss, are rarely at the table to discuss these issues and alternatives.
The populations who suffer the brunt of the consequences of mining, notably biodiversity loss, are rarely at the table to discuss these issues and alternatives.
If our research points to the need to question the sustainability of the extractive model at the origin of environmental impacts and loss of biodiversity, as important and related is the issue of the role, participation and meaningful consultation of the populations on whose lands extractive activities take place.
Finally, it also underlines the complex and unresolved question of responsibilities in situations of power asymmetries.
Beyond the responsibilities of national States where activities take place and the enterprises concerned, global responsibilities also involve the countries and States of origin of the extractive companies which often support and promote them in different ways and hence the duty of home states to ensure that these companies are accountable for the consequences of their activities. What is urgently needed is the introduction of legislated obligations in the countries of origin of companies which would establish that companies could face liability if they contribute to human rights violations, environmental degradation, and loss in biological diversity abroad. Legislation inspired by this model would impose broad due diligence obligations on companies incorporated in the home state that are at par with obligations for activities in the home state.
Feature Image: Black and White Ruffed Lemur. Photo Courtesy of Lynda Hubert Ta.
1 IUCN. 2022. The UICN Red List of Threatened Species. Version 2022-2. https://www.iucnredlist.org. Accessed on October 3, 2023.
2 See for example: Le Billon, P., (2021) “Crisis conservation and green extraction: biodiversity offsets as spaces of double exception”, Journal of Political Ecology 28 (1), 854–888. https://doi.org/10.2458/jpe.2991 zu Ermgassen, S. O. S. E., Devenish, K., Simmons, B. A., Gordon, A., Jones, J. P. G., Maron, M., Schulte to Bühne, H., Sharma, R., Sonter, L. J., Strange, N., Ward, M., & Bull, J. W., (2023) “ Evaluating the impact of biodiversity offsetting on native vegetation”, Global Change Biology 29 (15), 4397–4411. https://doi.org/10.1111/gcb.16801.