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Better Coal Initiative – defining standards – refining practice

Added on 07-06-2012

Company

Enel

Network

CSR Europe

Year

2011

Business challenge

Ensuring responsible management in the supply chain in order to decrease operational risks and to increase positive environmental and social impact on the ground is a challenge each and every company in the utilities sector is confronted with. However, one company may not have enough impact and leverage to substantially change the behavior and management of suppliers.

Description

BetterCoal was established by a group of major coal buyers to promote continuous improvement of corporate responsibility in the coal supply chain. More specifically, it aims to positively impact on the livelihoods of communities and to promote continuous improvement in the areas of ethical, social and environmental performance of global supply chains.  To achieve these goals it works on establishing one common approach through common sustainability standards in the coal sector.

The founding members were DONG Energy, EDF, Enel, E.ON, GDF Suez, RWE, and Vattenfall, and their initial aim was to support on-the-ground changes around coal mines to the benefit of workers, communities, businesses, and the environment.

Bettercoal was set up in response to companies’ need for greater assurance that their coal comes from mines that take a responsible approach to protecting workers, communities, and their local environment.

The initial focus is the mines themselves. We are convinced that we can bring change on the ground both at the mine and beyond the mine. We want to work with other stakeholders to achieve this goal. Our core activity is to provide coal buyers with robust ethical, social and environmental performance data to integrate into their individual coal purchasing decisions.

The initiative was formally launched in September 2011, and as a first key step, it started an effort to develop a Code of Practice for coal mines’ ethical, social, and environmental performance. This took place through a global, public consultation process starting in 2012, and it was developed with the support of an independent Stakeholder Advisory. In 2013 the BetterCoal Code was approved and published, on the basis of existing and agreed standards of social responsibility in the mining sector. It sets out in detail the guidelines which mining companies may refer to in order to define their own social, environmental and ethical policy. In addition, written communication on the work of BetterCoal is being finalised for all the mining companies which have a contractual relationship with the Enel Group. In particular, they will be informed on the campaign of self- and site-assessment which BetterCoal has planned and which in the new future may see them directly involved. The Code will be made publicly available in four languages – English, Bahasa Indonesian, Russian and Spanish.

The group is comprised of experts from civil society, trade unions, and the mining community and it is governed by a Board of Directors and by an Executive Committee, on both of which Enel has a representative, and by an Executive Director, supported by panels of external stakeholders with a consultative role. The initiative is open to the participation of new members, such as major coal buyers (including utilities in the electricity sector), and other industrial groups, such as steel makers and cement manufacturers.

The initiative is open to regular membership for major users of coal from anywhere in the world.

Impact

Over time we will consider whether and how to extend the application of the Code to companies in the downstream coal supply chain, including adapting and updating the Code as appropriate to reflect operating conditions relevant to those companies in other parts of the coal supply chain. The aim is to establish it as a globally accepted benchmark for ethically, socially and environmentally responsible practices in the coal supply chain  which  will be assessed by independent third party Assessors qualified by Bettercoal.

Challenges/Lessons learned:

Among the activities undertaken during the year, which saw the involvement of global stakeholders, including unions and NGOs, note should be taken of the realization of a “tool kit” designed to support mining companies so that, if they wish, they can independently measure their level of alignment with the ethical standards.

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