DAILY NEWSApr 20, 2015 4:30 PM
By: Marc Davis (SPONSORED CONTENT)
Consider this jaw-dropping game-changer: Tens of billions of dollars are being spent each year on a form of business-driven altruism that many outside the resource industries still have never heard of.
It’s called Corporate Social Responsibility (CSR), and it’s become an increasingly important buzz term in the business world, especially in the globally-diversified mining industry.
Exactly how important is CSR? Just ask the deflated management team at Vancouver-based South American Silver Corp. Or ask the company’s frustrated, out-of-pocket shareholders.
The aspiring silver and indium producer waited too long to implement a CSR campaign as it pushed for the development of a mine near the remote Andean community of Malku Khota in Bolivia. Meanwhile, anti-mining activists convinced the local population to violently oppose the company’s activities, which eventually led to the seizing and nationalization of its mineral assets by the country’s leftist government in 2012.
With many millions of dollars spent on the project before the expropriation, it is of little surprise the South American Silver’s stock tanked.
Yet, some mining companies still balk at the nominal cost of CSR. To them, its true value is hard to measure. Which makes it all too easy for them to regard CSR as window dressing that drains their coffers and misdirects corporate energy.
However, recent studies have shown that this outdated mindset has become a liability for each and every company that is reliant on winning hearts and minds in the under-developed foreign jurisdictions where they operate. In fact, this research reveals that CSR has many benefits that contribute to a corporation’s bottom line.
Moreover, it’s fast-becoming absolutely integral to the long-term survival of many capital-intensive businesses that operate in Latin America and other emerging economies. So suggests a 2012 study carried out by Tima Bansal, executive director of the Network for Business Sustainability at Western University’s Richard Ivey School of Business.
Another cautionary report, published by the accounting powerhouse Ernst & Young in 2013, reveals that the threat of resource expropriation has increased significantly within the last several years. It attests to a growing feeling among government and indigenous peoples that they are entitled to a share of the mineral resources which foreign companies (including many Canadian miners) commercialize in their territories.
“Mining and metals companies are forced to balance the expectations and needs of their many stakeholders,” the report states. “When they fail to meet expectations or fully understand needs, it can result in strikes, supply disruptions, shareholder activism, community unrest and governments using their power through resource nationalism.”
CSR is also more beneficial to a company’s image with the investment public than branding and other marketing ploys, according to the International Institute for Sustainable Development. In other words, CSR plays a key role in helping to insulate companies against shareholder activism and forms of negative publicity.
Therefore, it comes as no big surprise that approximately 2,470 first-world companies spent $26.5 billion on CSR initiatives last year, alone. And $5.3 billion of this figure was earmarked for educational programs, according to a United Nations report.
So it would seem CSR is a no-brainer. But there’s a real challenge faced by most mining companies, oil and gas explorers and other resource-based businesses. And this is to figure out exactly what CSR initiatives work best by way of winning over all the stakeholders involved. In other words, it’s no longer good enough to just build roads and outhouses as a way of “giving back” to under-developed communities.
So what’s a CEO to do?
Enter MetroLink Solutions. This enterprising Vancouver-based technology innovator has painstakingly developed a turnkey solution that allows companies to outsource their CSR needs. In fact, it’s a first-mover in the CSR business as a developer and distributor of communications networking infrastructure and media-rich content. This involves applications for cable, broadband, and wireless services — all of which is engineered to serve stakeholders in both remote and emerging economic jurisdictions the world over.
The company’s target market consists of Canadian mining companies, in addition to multinational corporations in a diversity of industries, including oil and gas. And MetroLink’s affable president, Griffin Jones, says he knows exactly what virtually every poor, struggling indigenous community in Latin America wants in order to view foreign corporations in a more favourable light.
“Rural areas have hardly any communications. They don’t have access to the Internet. Cell phone coverage is spotty as well. So they’re incommunicado, as well and so far under the poverty level, that they’re going to stay there until they have proper communications,” he says.
“It’s been proven that it’s extremely difficult to lift a community above the poverty line without getting these people on the grid, so to speak, with communications devices. Cell phones are a miracle for creating economic opportunity, as is the internet as well.”
Jones elaborates: “This doesn’t mean you have to possess your own internet connection. You could rent one by going to a local internet café. And currently, if there’s no internet or cell phone, you have to bus to the main village, which could easily take one day to get there and then another day to return.”
“That’s a relative horror story for residents who need to access communications. Conversely, if you could access communications locally, you could eliminate that two-day delay. Which is absolutely essential for commerce, not to mention health care and education.”
Simply stated, MetroLink’s goal is to empower North American mining companies in Latin America with these kinds of much-sought-after CSR services, including internet-based broadcast TV. This involves Spanish-speaking programming and internet content libraries for teachers, as well as health care libraries for physicians in the rural communities.
Add on to these initiatives an additional platform in the form of mobile phone communications provided by MetroLink and this business model seems to be a sure-fire formula for success.
Most importantly, all of this cyber connectivity is designed to be interactive. So, it will also provide residents the ability to communicate with teachers and health care professionals who are located in large urban centres.
In situations where communities do not have any pre-existing school houses or health care facilities, permanent brick and mortar buildings are often too costly to build and expensive to maintain. MetroLink aims to solve this challenge with its easily-assembled modular structures which are light-weight (built out of re-enforced Styrofoam), durable, energy-efficient in terms of heating and cooling, and powered by solar power.
This drastically cuts down construction costs, reduces power requirements and can utilize local labour to both build and maintain the structures. Furthermore, these structures can be disassembled easily and relocated if the need arises.
Additionally, MetroLink’s ability to service these communities with mobile phone communications creates micro-economic opportunities whereby rural residents can carry out cyber commerce with each other. This involves mobile payment solutions supplied by indirectly by MetroLink. In essence, residents would use their mobile phones as virtual wallets.
A wireless network takes about 90 days to build after surveying and should be self-sustaining by the third year. The cost of a wireless broadband network today is less than half of the cost just 10 years ago. Also, payment programs for CSR sponsors can be negotiated with regional development banks.
This relationship creates an economic sustainability and philanthropic legacy that will last long after a mine or other resource-based business venture has run its course. Furthermore, there’s the promise of an impressive ROI on a business model that MetroLink estimates will take three to six months from inception to fully-operational. It also represents a headache-free plug-in CSR opportunity for mining companies (and other industries) because MetroLink handles all the footwork, project management and monitoring.
MetroLink’s expert management has over 50 years of experience in communications networking, aggregating online content, and international marketing expertise. Additionally, they used a previous incarnation of MetroLink to prove the viability of this business model in impoverished First Nations communities in Canada.
In terms of the big picture, MetroLink aspires to become the largest independent North American telecom supplier in North America serving all of Latin America within the next five years. These are certainly lofty aspirations. However, let’s not forget that MetroLink is tapping into a lucrative, socially-conscious marketplace that is growing exponentially.
“We don’t have to capture a large segment of the CSR industry to be incredibly successful,” says Jones.
“Even if we only capture a fraction of the $26 billion-dollar-plus global CSR market, this represents a very lucrative revenue stream,” he adds.
“But ultimately, it’s our mandate to become the gold standard for CSR. And that’ll make us the “go-to” CSR provider for the whole mining industry. The same applies to other resource-based businesses, as well as other globally diversified industries. Now, that’ll prove to be a win-win solution for everyone involved.”
Having set its sights on South America in the near-term, MetroLink intends to grow its scalable business model to service other globally emerging markets. At present, the company is raising pre-IPO funding, some of which will be designated to its pilot project in Bolivia, which it hopes to have up-and-running within a 90-day time frame.
Jones says, “The company is pursuing a public listing on the increasingly popular Canadian Securities Exchange.”
For more information on MetroLink’s pre-IPO financing, contact:
Kent Robertson, Senior Investment Advisor
Jennifer Le, Associate Investment Advisor
For more information on MetroLink Solutions, please contact:
Griff Jones, President of Metrolink Solutions
© 2015 Mining Markets. All Rights Reserved.
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