Transnational corporations, gold mining and environmental management in Ghana : a case of Ashanti Goldfields Company

Abstract

ABSTRACT This thesis deals with Transnational Corporate Environmental Management in Ghana. Specifically, the thesis examines the content of Lonmin Plc’s Environmental Action Plan (EAP) at Ashanti Goldfields Company (AGC), and the context in which the EAP was prepared and is being implemented at Obuasi in the Ashanti Region in Ghana. Thus, it assesses Lonmin’s environmental management in relation to the institutional factors, which have influence on Lonmin’s environmental management. A case study approach is used in collecting data for the study and both quantitative and qualitative techniques are also used in analysing the data with the help of an analytical model.

The study reports that AGC did not have any Environmental Action Plan (EAP) and was not environmentally responsible until 1989. The Company began taking concrete measures with regard to its environmental responsibility after it had been told to do so by the International Financial Corporation (IFC) as a condition for a loan. Thus, the IFC was the brain behind AGC’s adoption and the subsequent implementation of the EAP and that IFC played an instrumental role in Lonmin’s relatively enhanced environmental performance at AGC.

The thesis indicates, however, that there is no formal arrangement for allocation of responsibilities on environmental management between the corporate headquarters and affiliate, Lonmin. Thus, there is no central support from the headquarters and that control of AGC seems to be rather decentralised, and responsibility for taking the initiative lies in the hands of the Management of AGC.

The Government of Ghana and the Ghanaian civil society do not have any significant role in respect of AGC’s adoption and implementation of AGC’s EAP at Obuasi. Thus, the institutional environment in Ghana as a watchdog on AGC’s environmental behaviour is ineffective.

By and large, this outcome of this research is a confirmation of my working assumptions: First, AGC’s environmental strategies and practices at Obuasi can be explained in relation to the institutional environment within which the Company operates. Second, AGC’s recent enhanced environmental performance and practices at Obuasi is due to a positive influence of IFC’s loan conditionalities more than a positive influence of the institutional environment within which the Company operates.