Document Abstract
Published:
1 May 2008
In the wake of ArcelorMittal: the global steel giant's local impacts
The social and environmental impacts of steel giant Arcelor Mittal’s growth
This paper investigates the impact of Arcelor Mittal’s growth on social and environmental factors focusing on cases studies in India, Romania, USA, South Africa, Ukraine, Bosnia, Kazhakstan, and the Czech republic.
The authors argue that the company’s success has coincided with the exploitation of weaker national laws and political wrangling. In the last three decades Mittal has bought up old, run-down state-owned steel factories in places like Trinidad, Mexico, Poland, Czech Republic, Romania, South Africa and Algeria. The cost of Mittal Steel’s success has largely been paid by the communities living and working near the company’s plants. Mittal Steel has a global reputation for prioritising productivity over the environment, communities and fair labour practices in countries where it operates steel mills, such as Romania, Poland, Czech Republic South Africa, Kazakhstan and the United States, in spite of frequent company statements about its attention to and investment in these areas. One of the most disappointing aspects of the Mittal success story is how, in spite of its poor environmental and social record, decision makers and international financial institutions have repeatedly supported the company, politically and financially, implicitly condoning its working practices. The case studies in this compilation show that the pollution, health and safety and labour problems experienced by neighbours and workers at Arcelor Mittal plants formerly owned by Mittal Steel are more than occasional blips. Rather, they represent the logical conclusion of the company’s strategy of buying old, heavily polluting steel mills and taking cost-cutting to its extreme.
Recommendations include:
The authors argue that the company’s success has coincided with the exploitation of weaker national laws and political wrangling. In the last three decades Mittal has bought up old, run-down state-owned steel factories in places like Trinidad, Mexico, Poland, Czech Republic, Romania, South Africa and Algeria. The cost of Mittal Steel’s success has largely been paid by the communities living and working near the company’s plants. Mittal Steel has a global reputation for prioritising productivity over the environment, communities and fair labour practices in countries where it operates steel mills, such as Romania, Poland, Czech Republic South Africa, Kazakhstan and the United States, in spite of frequent company statements about its attention to and investment in these areas. One of the most disappointing aspects of the Mittal success story is how, in spite of its poor environmental and social record, decision makers and international financial institutions have repeatedly supported the company, politically and financially, implicitly condoning its working practices. The case studies in this compilation show that the pollution, health and safety and labour problems experienced by neighbours and workers at Arcelor Mittal plants formerly owned by Mittal Steel are more than occasional blips. Rather, they represent the logical conclusion of the company’s strategy of buying old, heavily polluting steel mills and taking cost-cutting to its extreme.
Recommendations include:
- as a first step, where this has not already been done, the senior management of ArcelorMittal needs to meet with all stakeholders to listen to their concerns and to develop action plans for stakeholder engagement
- where they have been made, environmental action plans need to be released to the public, and where they have not been made they need to be developed
- local and national authorities must ensure that ArcelorMittal is not given any tax or environmental exemptions
- they must also ensure that ArcelorMittal is not allowed to displace poor and indigenous communities when their livelihood depends on the very land where the company plans to build its plants
- the European Bank for Reconstruction and Development (EBRD) and International Financial Corporation (IFC) must prevent ArcelorMitttal from receiving further low-interest public loans. They must also intensify their monitoring of environmental, labour and health and safety aspects of the ArcelorMitttal projects, as well as stakeholder engagement.
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