Conflict is escalating between Shell and residents of the Karoo who may be affected by future shale gas extraction.
Opponents accuse corporate tyrants indifferent to global warming of sacrificing a culturally and environmentally sensitive ecosystem to short-sighted profits.
Supporters decry reporting they call hysterical and anti-development sentiments they characterise as radical.
Both sides exploit subtexts of race and class.
One questions the character of the company and its leadership in its dealings in Africa, while the other suggests that it should be no surprise that a princess and one of the world’s richest men are indifferent to jobs and electricity for the people.
This is the level of discord and distrust before a single well has been drilled; we have not even entered the exploration phase.
Should production go forward, we can only imagine the conflicts ahead.
In the hope that these might be mitigated, in this case and others, some lessons from the study of business-community-government conflict and collaboration are offered.
First, in the current climate of name-calling and stone-throwing, it seems unlikely that any of the relevant matters will actually become better understood.
Shale gas extraction in the Karoo touches on a dizzying array of important issues, encompassing jobs, economic development, energy availability, the state of science and technology, prioritisation of water resources and wilderness protection, potential impact on community and social relations, potential effects on farming and ecotourism, and the division of benefits and risks among surface communities, those exploiting underground resources and the government that owns them.
But parties in highly defensive postures are not open to new ideas and perspectives.
Data and analysis become simply more missiles launched across an ever-widening divide.
To the extent that the company’s strategy includes education of the government and communities, it is well-advised to work to make sure that defensive hackles not go up in the first place.
Learning must come before contentious action, if it is to occur at all.
Second, a rights-based approach to managing disputes tends to increase rather than decrease conflicts among business, communities and the government.
A company often enough enters a new venture with a high degree of self-confidence. Before gaining board and management approval to move forward it has analysed technical, financial and legal issues – and increasingly, reputation and social responsibility – at least from its own perspective.
The company therefore tends to assume that, as long as it follows the formal processes laid out by law, it is in the right.
But a process designed to produce binary decisions – can Shell drill an exploration well or can’t it? – will invite parties who perceive their interests to be threatened to take extreme positions.
They will challenge the parties, the process and the decision to show the company to be in the wrong.
To the extent that the company’s strategy includes an ability to solve problems with other stakeholders over the long term, it is well-advised to endeavour to build strong working relationships.
The company must begin with a collaborative rather than a rights-based approach to community and government engagement.
Third, victories can be short-lived.
“Winning” at an early stage can easily enough mobilise “losers” to even more concerted efforts, whether through legal, political, or direct action.
A colleague, expert in long-term contractual relationships, constantly reminds his clients that “10 years is long enough for them to figure out how to get back at us”.
As exploration moves to production, there is ample time for parties who feel aggrieved to understand the choke points of operations and profitability to bring renewed pressure on the company.
To the extent that the company’s strategy anticipates a 30-year relationship with the government and communities, it is well advised to work to avoid letting any party feel like losers.
The company must be constantly attentive to the interests, needs, fears and perceptions of others.
It was a Dutch colleague who introduced me to the saying that trust arrives on foot, but leaves on horseback.
So what might a company in Shell’s position do to build confidence, open ears to at least listen to its point of view, and see if the challenges and opportunities of shale gas extraction can be collaboratively addressed?
A starting point might be to acknowledge – which is different from agreeing with – the perspective of their now-opponents: the seriousness of their concerns, and the consequences to the Karoo and its communities should it turn out that they be right and Shell be wrong.
It might acknowledge that it is the guest, albeit one who is hoping to stay for a very long time.
It might acknowledge that, as an interested party, it can’t be in charge of the issues on the agenda, the parties at the table, or the process followed – and suggest that a neutral third party, such as a mediator, could be of help. On such a basis, the first question on the table might not be whether shale gas extraction should go forward.
Rather, it could be how it might be possible for the full range of stakeholders to explore together the best way of approaching that decision.
l Brian Ganson is the senior researcher with the Africa Centre for Dispute Settlement at the University of Stellenbosch Business School, where he leads the initiative on Business, Peace & Prosperity. He is also senior fellow with the Center for Emerging Market Enterprises at The Fletcher School of Tufts University.