Conceptual and Methodological Advances
Edited by Frank Vanclay and Ana Maria Esteves
Chapter 14: Enhancing the Benefits of Projects through Local Procurement
Ana Maria Esteves, Mary-Anne Barclay, David Brereton and Daniel Samson Introduction There is growing interest in several industries in enhancing the opportunities for locally-based businesses to participate in the supply chains of major resource projects. Several companies, especially in the mining, oil and gas sectors, have adopted policies and standards aimed explicitly at increasing ‘local procurement’ or ‘community content’, recognizing that local economic participation has benefits for companies and communities alike. From a corporate perspective, local economic participation is seen as one means of maintaining a social licence to operate, as well as ensuring reliability of supply by having a supplier located nearby. From a community perspective, the participation of local businesses in the resource project is a means by which the benefits of resource development can flow into their communities. The benefits of supply chain participation have become particularly apparent in Indigenous communities where there are now a number of agreements between companies and Indigenous groups that are aimed at enabling greater Indigenous economic participation, and include commitments to support the development of Indigenous-owned enterprises. This chapter is based on the research undertaken by the authors to produce a good practice guide for the Australian mining, oil and gas sector (Esteves et al., 2010). A comprehensive review of procurement practices around the world was undertaken. We also examined 23 companies in the mining, oil and gas sectors to consider how their supply chain practices can contribute to the social and economic development of local communities. The general stories about...
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