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Relationships with Communities

Local community engagement, impact assessments, and development programs, grievance and feedback mechanisms, and community investment.

GRI Indicators
102-34, 201-103, 203-103, 203-1, 205-1, 413-103, 413-1, G4-MM6, G4-MM7

Relationships with Communities

Businesses are increasingly being evaluated not only on financial performance and quality of their products or services, but also on their social impact.10 Strong relationships between companies and their communities of interest, where there are clear mutually defined benefits and mechanisms to resolve conflict, are essential for business continuity and growth. But as traditional benefits such as jobs and procurement are changing in the face of new technology, and as conflicts arise from divergent perspectives on responsible resource development, these relationships can come under stress.11

Communities may be affected positively and negatively by the impacts of mining. Negative impacts can include competition for water and energy, and emissions to air; positive impacts can include local hiring and procurement, socio-economic growth, and direct community investment. In recognition of these impacts and opportunities, the International Council on Mining and Metals (ICMM) established stakeholder engagement as one of its 10 Principles.

While specific opportunities and concerns about the impacts of our activities vary among communities in the areas where we operate, one of the common expectations of all communities is meaningful engagement throughout the mining life cycle. These relationships continued to be a strategic business priority across all of our sites in 2018. For example, community engagement was a critical part of the social and environmental impact assessment process for our Quebrada Blanca Phase 2 project. We engaged communities in relation to the development of all of our projects and continued to advance relationships with communities near all of our operations.

10 Introduction: The rise of the social enterprise. Deloitte Insights. 2018.
11 Annual EY mining business risks report ranks licence to operate at top. International Mining. December 2018. 

Our Approach to Relationships with Communities

The Board of Directors, through its Safety and Sustainability Committee, broadly oversees health, safety, environment and community policies, systems, performance and auditing, including implementation of our Health, Safety, Environment and Community (HSEC) Management Standards. The Community Investment Committee oversees our community investment program to ensure that contributions are made in a manner that benefits our communities of interest, and that contributions are aligned with our business objectives. It is chaired by the Senior Vice President, Sustainability and External Affairs.

The following senior leaders are involved in implementing the management of relationships with communities:

  • The Senior Vice President, Sustainability and External Affairs reports directly to our CEO and is responsible for sustainability, health and safety, environment, community, and Indigenous affairs

  • The Vice President, Community and Government Relations leads activities related to social management and responsibility, community engagement, community investment, and Indigenous affairs

Compensation

Teck’s bonus compensation structure is based on objectives outlined through three components: corporate, business unit and personal. Across the three components, objectives related to sustainability performance (HSEC topics) affect approximately 10%–20% of the bonus as a whole. The business unit component for operations has three metrics: production (33.3%), cost (33.3%) and sustainability (33.3%) of the specific operation.

Particular members of Teck's management team are also incentivized to manage sustainability-related issues, which can include community management, primarily through the personal component of the bonus plan. In addition, all members of our senior management team have at least 5% of their annual total target bonus based on sustainability performance.

Teck’s Code of Sustainable Conduct commits Teck to engaging with communities. Our Human Rights Policy, Indigenous Peoples Policy, Inclusion and Diversity Policy, Code of Ethics and Expectations for Suppliers and Contractors also provide guidance on building and managing relationships with communities.

We work with various local, national and international organizations and programs to support improvements in best practices for social management and responsibility across the industry, including, for example:

  • International Council on Mining and Metals (ICMM): A global industry association that represents leading international mining and metals companies who are required to implement the ICMM 10 Principles, including Principle 9 on social contribution

  • Prospectors & Developers Association of Canada (PDAC): Represents the interests of the Canadian mineral exploration and development industry. We incorporated PDAC’s Environmental Excellence in Exploration framework into the development of our HSEC Management Standards and into the Social Management and Responsibility at Teck (SMART) Exploration Tool.

  • Mining Association of Canada (MAC): Promotes the development of Canada's mining and mineral processing industry. Through MAC, we are required to implement the Towards Sustainable Mining program, including the Aboriginal and Community Outreach protocol, which aids in improving industry performance.

  • United Nations Global Compact (UNGC): Provides a framework for businesses committed to aligning their operations and strategies with 10 principles spanning human rights, labour, the environment and anti-corruption

Teck’s SMART Framework is our approach to improving our social performance across Teck’s sites while also recognizing the unique context and circumstances of each region. We focus on four core social management areas that are essential for establishing and maintaining strong positive relationships:

  • Engagement: Engaging with people on what matters to them while identifying opportunities to maximize their input into decision-making

  • Impacts: Working to mitigate or minimize the negative impacts of our activities

  • Feedback and Incidents: Systematically addressing and learning from feedback received and incidents that occur

  • Benefits: Identifying opportunities to maximize the positive benefits of our activities

We have Communities teams at each of our operations who operationalize the SMART Framework to build and strengthen trust-based relationships with local communities and stakeholders. At our exploration and development projects, exploration geologists and project managers are responsible for implementing the SMART Framework with local communities through all stages of their activities. Teck’s corporate Social Management and Responsibility team provides site support and guidance to sites in implementing the SMART Framework, as well as regularly reviewing their performance.

The community relations team members are provided the training and skills necessary to fulfill their responsibilities in connection to the SMART Framework.

Figure 1: SMART Framework

Assessing Social Risk

Teck is committed to proactively managing potential social risks. A social risk assessment is the process of identifying, evaluating and recommending an appropriate course of action to address these social risks.

Teck’s social risk assessments begin with evaluating the geographic range of impact of a site’s or project’s activities, and developing a tailored social risk profile. We then systematically identify and evaluate potential risks and opportunities that Teck and our communities of interest can pose to one another. Examples of social risks include environmental concerns contributing to erosion of community trust, and disputes around land rights affecting local livelihoods or cultural practices.

Engagement with our stakeholders helps us to ensure we understand the positive and negative impacts of our business, as well as the risks and opportunities associated with those impacts. It enables us to manage impacts in a responsible and effective manner, and understand the effectiveness of our management actions.

We organize our engagement with stakeholders into three levels: information disclosure, dialogue and participation. Guided by our HSEC Management Standards and our SMART Framework, our operations, exploration sites, projects and closed properties identify and prioritize local and regional stakeholders, undertaking broad, inclusive and regular engagement activities.

Those responsible for engagement are trained to take a people-centred approach to dialogue that is focused on relationships, rather than on issues. This helps ensure that engagement is productive and constructive, and that it directly contributes to the building and maintenance of long-term, trust-based relationships.

Managing Community Feedback

Teck provides direct feedback mechanisms at every operation and project and in every exploration region to specifically ensure that those who want to provide feedback — whether it’s a comment, question, concern, complaint or compliment — are able to do so easily and, if they wish, anonymously.

Operations are required to follow up to determine cause, implement appropriate improvement actions, and communicate this information in a timely manner back to the complainant. Significant feedback items may be subject to root cause analysis or investigation. Corporate guidance, tools and the sharing of best practices supports the feedback mechanism at each operation.

Feedback mechanisms may include dedicated phone lines and in-person or online platforms. Feedback received is recorded using a database system called TrackLine and categorized by topic and severity. Negative feedback items, sometimes called grievances, are specific issues of concern to community members that require a response and potential further action from the company.

Through annual opinion surveys, community stakeholders are also able to provide feedback on Teck’s activities. This information is used as a check on our efforts to improve our social management activities while continuing to address our most significant social risks.

Managing Incidents

For Teck, an incident is defined as an “undesirable event arising from company activities that is both unplanned and uncontrolled, regardless of the severity of consequences”. Criteria have been established for sites to evaluate the severity of impacts with respect to community incidents. Sites are expected to follow up on all incidents identified, with more significant incidents potentially subject to root cause investigation.

Teck works to generate value from the extraction, processing and sale of mineral, steelmaking coal, oil and metal resources to ensure the long-term sustainability of our operations and their contribution to communities. Benefits may include training, employment and procurement opportunities, capital investments, payments to governments and Indigenous Peoples, and shareholder dividends. Our corporate office and operating sites engage with communities, governments, and non-governmental organizations to align activities with local, regional, national and international development planning where appropriate.

Local Hiring and Procurement

Local hiring is a priority at Teck operations. To ensure local hires have the skills necessary for employment and advancement, we support access to relevant training opportunities at or near Teck’s sites. For example, our Carmen de Andacollo Operations in Chile contributed to the first mining training facility in the region and provided micro-grants as well as training to help businesses grow.

Whenever possible, our sites also utilize local suppliers, providing that they meet our health, safety, environmental and community requirements, and provide cost-competitive goods and services. Commitments regarding procurement and hiring practices are also often included in agreements between Teck and Indigenous communities.

Community Investment

Community investment is a key pillar of our company’s overall commitment to the communities where we live and work. Our internal community investment policy guides how we align business drivers with community priorities, and guides our approach to providing sustainable community benefits.

Our community investment program is guided by best practices from the International Finance Corporation. We aim to contribute, at a minimum, 1% of our pre-tax earnings on a five-year rolling average basis to community investment. With our target tied to earnings, our success as a company directly impacts our ability to invest in the communities where we operate.

See the Community Investment page for further information.

Our Sustainability Strategy guides our long-term approach to relationships with communities across the organization.

By 2020, we will:

  • Refine our business policies and practices based on results of our social risk assessments, our work in human rights, and developments in the rights of Indigenous Peoples

  • Engage with communities to identify social, economic and environmental priorities and to mutually define outcomes and measures of success

  • Work with Indigenous Peoples to identify and participate in initiatives to support the self-defined goals of Indigenous communities

  • Develop metrics for monitoring Indigenous training, employment and procurement to establish baselines and drive progress

By 2030, we will:

  • Fully integrate social risk and opportunity, human rights and the rights of Indigenous Peoples into how we do business and into our individual actions and behaviours

  • Create lasting mutual benefits through collaboration on social, economic and environmental initiatives

  • Collaborate with Indigenous communities to consistently create lasting benefits that respect their unique interests and aspirations

Table 1: Community-Related Audits

Type Organization Items Audited
External Mining Association of Canada: Towards Sustainable Mining audit

Community of Interest (COI) identification

Effective COI engagement and dialogue

COI response mechanism

Reporting 

External International Council on Mining and Metals: Sustainability Report assurance

Total number of significant disputes relating to land use and the customary rights of local communities and Indigenous Peoples

Principle 3: Respect human rights and the interests, cultures, customs and values of employees and communities affected by our activities

Principle 9: Pursue continual improvement in social performance and contribute to the social, economic and institutional development of host countries and communities

Following each of these audits, applicable management teams use the results to inform future actions and Teck’s five-year planning process.

Our Performance in Relationships with Communities in 2018

Engagement on Actual or Potential Impacts

Guided by our Health, Safety, Environment and Community (HSEC) Management Standards and our Social Management and Responsibility at Teck (SMART) Framework, we require all 13 (100%) of our operations, all (100%) of our projects, and all of our exploration activities to engage and consult with stakeholders and communities to address current and emerging issues and to maximize opportunities that provide strategic value for both Teck and those communities.

Activities across the mining life cycle may result in a range of social, economic and environmental impacts, both positive and negative. Examples of specific impacts experienced at our operations in 2018, and major engagements undertaken, are discussed in Table 15.

Table 15: Selected Major Engagement Activities in 2018

Actual or Potential Impacts on Communities from Our Activities

Sites

Major Engagement Activities

Environmental/Socio-Economic: livelihoods and community well-being

Carmen de Andacollo Operations

Engaged directly with community members, with local government and with service agencies to address dust concerns as well as health, environment and socio-economic development priorities.

Environmental: off-site environmental incidents

Trail Operations

Engaged with Trail residents and local government on impacts of sulphuric acid spills that occurred during transportation of the product from our operations after it was sold to a third party.

Socio-Economic: economic well-being of Indigenous communities

Highland Valley Copper Operations

Engaged with Indigenous Peoples near operations on implementation of commitments under agreements, including local hiring and procurement opportunities.

Community: subsistence resources, traditional land use and community health

Red Dog Operations

Engaged with residents of the village of Kivalina on perceived local water and health impacts through a joint working group.

Community: local employment and economic development

Engaged on implementation of a new village investment fund as well as on local employment and contracting opportunities associated with regional exploration activities.

Socio-Economic/Environmental: potential new project development in the region

Cardinal River Operations

Engaged with local Indigenous Peoples on potential impacts on water and socio-economic opportunities through the proposed MacKenzie Redcap extension.

Environmental/Socio-Economic: livelihoods and community well-being

Steelmaking coal operations in the Elk Valley

Engaged with the District of Sparwood and members of the wider community on joint processes to support local livability and to address dust impacts in the area.

Environmental/Socio-Economic: water and local livelihoods

Quebrada Blanca Operations

Engaged with communities to jointly monitor water impacts and identified local development opportunities.

Environmental/Socio-Economic: expanding operations at Quebrada Blanca

Quebrada Blanca Phase 2 project

Engaged with Indigenous and non-Indigenous communities, fishing unions and civil society as part of the QB2 regulatory review process.

Socio-Economic: economic well-being of Indigenous communities

Frontier project

Engaged with several Indigenous communities to establish impact benefit agreements.

Environmental: water and local livelihoods

Zafranal project

Engaged with local communities on water sources for the project, and on advancing the development of local economies.

 
Teck’s SMART Framework

In 2018, we undertook self-assessments of the implementation of the SMART Framework at all of our operations to ensure consistency with Teck’s standards and to target opportunities for improvements. We implemented updates to our SMART toolkit, including new or updated guidance on feedback reporting, community incident reporting, community investment and benefits management, as well as piloting new SMART training for our social practitioners.

We also provided training in dialogue skills for our practitioners in both North and South America; hosted a cross-Teck Community of Practice workshop for more than 60 staff across Teck’s operations, projects, exploration teams and functional groups; and launched a software tool for continued engagement and sharing of best practice.

Understanding our Communities

In 2018, Teck conducted company-wide opinion research about communities near our operations for the second consecutive year, to continue gathering insight on the issues that communities care about most. The data obtained helps to measure and guide improvements to our performance, assess the impact of events, inform our five-year planning process and support our reporting. The surveys were conducted by an independent polling company.

Feedback, Grievances, Disputes and Incidents

All of our operations and major projects and most of our exploration projects have implemented feedback mechanisms, which help us to understand our impacts on communities and take steps to address negative impacts and replicate positive impacts. Feedback received is recorded and categorized into four levels:

  • Level 1: Feedback/donation request
  • Level 2: Question or concern
  • Level 3: Issue, concern or grievance
  • Level 4: Repeated and ongoing concern, or an issue, concern or grievance that is major in nature and may include a breach of law or company policy

Level 3 and 4 feedback items are referred to as negative feedback or “grievances”, recognizing that they are often specific issues of concern to community members that require a response and potential further action from the company.

Feedback

In 2018, we received 1,169 instances of feedback through direct feedback mechanisms established across our sites, compared to 906 in 2017. Feedback levels will vary from year to year for several reasons, including the level of permitting or project activity. As efforts increase by our sites to improve the extent to which feedback mechanisms are used, we may see an increase in the overall amount of feedback received.

Figure 17: 2018 Feedback Received by Category(1)

Grievances

In 2018, of the total feedback received, 220 items were considered grievances. Grievances are reflective of perceived or actual events taking place as a result of company activities, and therefore do not necessarily constitute an actual negative impact or non-conformance event. Teck’s practice is that all feedback, which includes grievances, is acknowledged and assessed, and a response is communicated to the complainant, with the goal of providing a satisfactory reply or resolution in a timely manner.

Figure 18: 2018 Grievances Received by Category(1)
 

1Our feedback system allows for multiple labels to be assigned to each grievance/feedback. For the purposes of these diagrams, we have chosen the primary label assigned by our community relations professionals.


Disputes

Disputes represent conflicts between the company and the impacted community related to land use and the customary rights of local communities and Indigenous Peoples. Disputes are considered significant when they cannot be resolved jointly within a reasonable time frame, are repeated or widespread, or represent potentially significant or long-term financial, legal or reputational consequences for the community or company. In 2018, zero Teck sites experienced significant disputes (Level 4 severity or higher).

Table 16: Significant Disputes(1)

 

2018

2017

2016

2015

# of significant disputes

0

0

4

3

1Total number of significant disputes relating to land use and the customary rights of local communities and Indigenous Peoples at Teck sites.

 
Community Incidents

In 2018, we continued to implement a community incident reporting system to ensure we are capturing and responding to all community concerns in addition to those raised through our usual feedback mechanisms. An incident is an occurrence where individuals or groups may cite real or perceived breaches of law or company policy, real or perceived impacts on human rights (particularly related to land use) or the customary rights of Indigenous Peoples, and/or real or perceived impacts resulting in health effects.

In 2018, Teck had no significant community incidents, however we did experience some less severe incidents, such as the following:

  • After regulatory approval of the Quebrada Blanca Phase 2 project, the project experienced protest events with local fishermen’s unions seeking benefits agreements. Events were short in duration with minimal impact and the project has since initiated constructive dialogue with the parties involved to seek opportunities to secure community opportunities associated with the new project as it progresses.

 
Economic Value Generated and Distributed

We contribute to the wealth and prosperity of the countries, regions and communities where we operate by generating economic value that includes tax and royalty payments, local hiring and procurement, and community investments. We work to improve efficiency of our activities and reduce our operating costs to maximize the economic value generated.

Table 17: 2018 Breakdown of Economic Value Generated and Distributed (millions)

 

Economic Value Generated

Economic Value Distributed

Economic Value Retained

 

Revenues(1)

Payment to Suppliers(2)

Employee Wages and Benefits(3)

Payments to providers of capital(4)

Income and Resource Taxes(5)

Community Investments(6)

Total

 
 

 

Operating Costs

Capital Expenditures

Operating Costs

Capital Expenditures

USA

        1,973

       947

          215

       178

               3

             -

       96

               -

1,439

   534

Canada

        9,503

    5,080

       1,091

    1,163

             15

       714

        360

10

 8,423

    1,080

Chile

           711

     397

          424

       104

             28

            -

          76

5

1,029

     (318)

Peru

        1,027

       272

          107

       103

                -

            -

      248

2

   730

        297

Other

               -

           9

          23

           7

                -

            -

          -

3

      39

       (39)

Inter-segment elimination(2)

        (650)

     (650)

            -

      -

 

 

 

 

(650)

           -

Total

 12,564

     6,055

       1,860

   1,555

             46

    714

     780

22

11,010

    1,554

1 Revenues are presented based on an accrual basis. Internal cross-border sales are eliminated as shown.
2 Operating costs include operating expenses at our mining and processing operations and our general and administration, exploration and research, and development expenses and costs relating to production stripping. Operating costs excludes depreciation, and employee wages and benefits, which are specified separately. Capital expenditures are payments for purchases of property, plant and equipment, excluding the component relating to capitalized wages and benefits, which is specified separately.
3 Wages and Benefits reflects total amounts paid to employees relating to wages and benefits, including payroll taxes.
4 Payments to providers of capital include dividends paid to shareholders, interest paid to debtholders, and payments for share repurchases less issuance of shares.
5Income and resource taxes include amounts paid in the year.
6Community investments include voluntary donations paid during the year.

In 2018, we had a profit attributable to shareholders of $3.1 billion or $5.41 per share. This compares with a profit attributable to shareholders of $2.5 billion or $4.34 per share in 2017. See our Annual Report for more detailed information on our financial performance.
 

Local Hiring and Procurement

We track the number of local employees and the value of local procurement as reflected in Table 17, with the latter being influenced primarily by the extent of site-level construction and maintenance activity as well as by the availability of suitable suppliers in the local area. We continue to focus on hiring people locally, as it helps to share the economic benefits of our industry with the communities in which we operate. In 2018, our overall average of local employees was 71% of our operational workforce, compared to 72% in 2017.

Table 18: Local Employment in 2018(1),(2)

Operation

Local Employees

Percentage of Local Employees

Senior Management Roles Filled by Locals

Cardinal River

310

76%

46%

Carmen de Andacollo

418

61%

0%

Coal Mountain

55

66%

50%

Elkview

635

58%

91%

Fording River

735

55%

96%

Greenhills

438

63%

72%

Highland Valley Copper

1,282

91%

24%

Line Creek

393

58%

95%

Pend Oreille

181

70%

22%

Quebrada Blanca

195

48%

27%

Red Dog

372

74%

35%

Trail Operations

1,446

95%

34%

Total

6,460

71%

47%

1Data is not directly comparable between operations, as there are differences in how each operation defines “local” and how each operation tracks data.
2“Local” is generally defined as persons or groups of persons living and/or working in any areas that are economically, socially or environmentally impacted (positively or negatively) by an organization’s operations. The community can range from persons living adjacent to operations to isolated settlements at a distance from operations, but individuals are still likely to be affected by these operations.

 
Table 19: Percentage of Total Spend with Local Suppliers

Operation

2018

2017

2016

2015

Cardinal River

14%

12%

9%

8%

Carmen de Andacollo

14%

13%

18%

19%

Steelmaking coal operations in the Elk Valley

41%

26%

41%

48%

Highland Valley Copper

32%

37%

30%

29%

Pend Oreille

14%

14%

20%

12%

Quebrada Blanca

5%

12%

33%

24%

Red Dog

75%

41%

59%

55%

Trail Operations

29%

29%

27%

24%

Total

33%

26%

30%

27%

 
Community Investment

We continue to meet our target of donating at least 1% of our earnings before interest and taxes on a five-year rolling average basis. Our earnings before interest and taxes are calculated against total (100% of) revenues. Our community investment expenditures in 2018 were $22 million. Information on our community investment reporting framework is available on our website.

Given that our community investment budget target is tied to earnings on a five-year rolling average, our target in 2018 was $12.8 million. However, based on Teck's financial performance for the year, the actual investment budget was increased to ensure continuity of existing programs and to take advantage of emerging community investment opportunities, thus we purposely exceeded the 1% budget target for 2018.

Table 20: Community Investment by Site(1)

Operation

2018

2017

2016

2015

Corporate Offices and Projects(2)

$13,387,000

$8,956,000

$6,844,000

$10,602,000

Carmen de Andacollo

$2,264,000

$1,773,000

$1,929,000

$2,310,000

Steelmaking coal operations(3)

$2,134,000

$675,000

$679,000

$672,000

Duck Pond

$12,000

$180,000

$263,000

$309,000

Highland Valley Copper

$713,000

$391,000

$410,000

$456,000

Pend Oreille

$20,000

$16,000

$25,000

$18,000

Quebrada Blanca

$1,857,000

$256,000

$368,000

$513,000

Red Dog

$686,000

$541,000

$948,000

$1,284,000

Trail Operations

$326,000

$338,000

$339,000

$480,000

Exploration

$146,000

$80,000

$35,000

$89,000

Total

$21,545,000

$13,206,000

$11,840,000

$16,644,000

1 The numbers represent Teck’s portion of ownership during 2018 (Carmen de Andacollo 90%, Quebrada Blanca 90% and Galore Creek 50%).
Includes Calgary, Santiago, Spokane, Toronto and Vancouver offices as well as resource development projects (Frontier, Galore Creek, Quebrada Blanca 2 and Quintette).
3 Steelmaking coal operations include Cardinal River, Coal Mountain, Elkview, Greenhills, Fording River and Line Creek operations.


Team Teck

The Team Teck Community Giving program offers our employees the opportunity to amplify their donations to causes that they care about through donation matching from Teck. In 2018, employees across Teck supported several initiatives, with a total of $132,800 provided by Teck in matching funding.


Outlook for Relationships with Communities

In 2019, we will work to maintain and strengthen relationships with communities at our operations and as we advance major projects, including Quebrada Blanca Phase 2. In particular, we will focus on addressing community concerns about environmental impacts by continuing to build on our efforts to improve dust and water management.

We will continue to improve the implementation of our SMART program and the associated training to enable further improvements in the management of our social risks. We will work to improve our management of community feedback and incidents to continuously build on our relationships with communities. In terms of economic contributions, we will prioritize local employment, procurement and community investment, with a focus on pursuing integrated strategies to provide better linkages between benefits.

 


Teck

Teck is a diversified resource company committed to responsible mining and mineral development with business units focused on copper, zinc, steelmaking coal and energy.