Community Investment

Community Investment and Sustainable Development

Why is community investment and sustainable development important?

We invest a significant portion of our economic value back into our host countries and local communities in line with our sustainability pillars. Creating opportunities for meaningful dialogue and applying our social management framework tools helps us to better understand community needs and interests and identify beneficial and viable legacy social programs and community investments opportunities. At Pan American Silver, we want our host communities to see our presence as a positive factor in their lives.

Material TopicCommunity investment and social development
Sub-TopicEconomic impacts
Socio-economic development programs
Infrastructure investments
Local hiring and procurement
DefinitionContributing to the social and economic well-being of local communities
Feedback From COIsCommunity members request employment opportunities.
How We’re RespondingOur community teams work with community members to identify potential job opportunities and provide the necessary training and capacity building.

Our participatory baseline assessment in Peru resulted in an updated economic development program that will involve 500 alpaca breeders.

Potential risks and impacts

  • Community opposition to mine operations or development resulting in project or production delays, failure to obtain permits or loss of social acceptance 
  • Negative impacts on local communities, such as economic dependence, wealth disparity, or impacts on vulnerable groups

Related SDGs

Our Approach

Early and ongoing community engagement and meaningful dialogue are key to better understanding our actual, potential, and perceived impact and to building trust with our host communities. We use our ongoing social management processes and tools, as set out in our social management framework, to better manage our impacts and identify opportunities for long-term investment in local communities.

Programs and Initiatives

  • Socio-economic development programs – We create and sustain programs focused on education, health, and alternative economic opportunities.
  • Local infrastructure and services – We invest in and upgrade infrastructure and services, such as schools, health facilities, water and sanitation services.
  • Jobs and business opportunities – We hire and procure locally and provide training and capacity building in roles at or related to our operations.
  • CDI Tool – We use this tool to identify and develop socio-economic programs with a high likelihood of long-term success and impact. 

Our Performance

Our core business activities generate economic value for COIs at the international, national, regional and community levels, both directly and indirectly. Our direct investments include payments to government, wages paid to employees, community investments, and payments to governments. These payments to national, provincial, state, regional, municipal, local, and community governments in the form of taxes, royalties, and fees, can be reinvested in social and economic programs that benefit the communities in the regions where we operate.

Our approach

Early and ongoing community engagement and meaningful dialogue are key to better understanding our actual, potential, and perceived impact and to building trust with our host communities. We use our ongoing social management processes and tools, as set out in our social management framework, to better manage our impacts and identify opportunities for long-term investment in local communities.

Programs and Initiatives

  • Socio-economic development programs – We create and sustain programs focused on education, health, and alternative economic opportunities.
  • Local infrastructure and services – We invest in and upgrade infrastructure and services, such as schools, health facilities, water and sanitation services.
  • Jobs and business opportunities – We hire and procure locally and provide training and capacity building in roles at or related to our operations.
  • CDI Tool – We use this tool to identify and develop socio-economic programs with a high likelihood of long-term success and impact. 

Our Performance

Our core business activities generate economic value for COIs at the international, national, regional and community levels, both directly and indirectly. Our direct investments include payments to government, wages paid to employees, community investments, and payments to governments. These payments to national, provincial, state, regional, municipal, local, and community governments in the form of taxes, royalties, and fees, can be reinvested in social and economic programs that benefit the communities in the regions where we operate.

Socio-Economic Development Programs 

We invest in socio-economic development programs that provide lasting benefits to our host communities. Our intent is that the benefits will long exceed the lifespan of our mines. We focus on programs related to education, health, and alternative economies, which we have found are most likely to provide long-term positive benefits. Our CDI Tool helps us assess the likelihood for success of these programs and to measure their success.  

Socio-Economic Development Programs

Our alternative economies programs include the:  

  • Nutritional Greenhouse Program in Bolivia, designed to support 11 local communities in sustainable food production and provide access to fresh produce and improve family nutrition. 
  • Artisanal Weaving Project in Peru, which, in 2018,  supported 61 female weavers with supplies and professional development training. 
  • Ranching Project in Mexico, which supports 135 community members.

Our education programs:

  • Provided support for child and adult literacy and education by fully supporting or supplementing wages of 182 teachers.
  • Provided university scholarships for 134 students in the countries where we operate.

In total, our programs provided direct and indirect support to 5,232 students in 2018.

Our health programs are intended to improve access to health services for all community members with a focus on identified vulnerable groups, such as young children, women, and elders. In 2018, our initiatives supported 9,386 medical visits by community members.

Direct economic value generated and distributed

Infrastructure and Services Investments

We regularly make investments in and upgrades to local infrastructure and social services in the communities near our operations. In 2018, significant initiatives included: 

  • Construction of the road from the Dolores mine to Madera town.
  • Sanitation planning in Arroyo Amplio, a town near Dolores. 
  • Sanitation planning in the San Vicente mine’s family camp.

Local Hiring and Procurement

Given the remote location of some of our sites, there may be few opportunities for long-term, stable employment. Consequently, community members look to us to provide jobs through direct employment or as service providers for our mine sites. In 2018, 99 percent of our employees were nationals of the country where the mine is located. 

Not all community members will have the qualifications to perform skilled labour. Consequently, our sites and community teams look to: 

  • Provide opportunities for unskilled employment, such as road building.
  • Identify on-site job opportunities, such as machinery worker, where we are able to provide the required skills and safety training. 
  • Offer ongoing capacity and skills building to help employees and contractors move into higher paying roles. 

Our procurement practices also create opportunities for local businesses in the regions where we operate. Pan American Silver’s procurement is intentionally decentralized, and we are able to procure the majority of goods and services we need in national economies. This approach supports our ability to operate profitably over the long term by deepening our sites’ relationships with local suppliers, providing a higher level of service, and helping us build a more resilient supply chain. In 2018, 46 percent of goods and services were provided by local or regional suppliers.  

Key goods and services sourced locally include:

  • Materials for road construction
  • Machinery and small parts
  • Food and catering services
  • Maintenance services
  • Earthmoving equipment for road maintenance and smaller construction projects

We also help community members launch small businesses by matching a site’s business needs to the interests of community members. To date we have helped launch 78 small businesses. Where local suppliers cannot meet our needs or business standards, we invest in their capacity by offering programs and support focused on:

  • Business skills, such as accounting and bookkeeping
  • Bidding processes
  • Health and addiction workshops
  • Pan American Silver’s business standards and expectations 
  • Health and safety training to contractors 

Spending by Region

Next steps

  • Improve existing processes, such as optimizing our grievance and feedback mechanisms, and expand our COI mapping/engagement to include a broader set of COIs. 
  • Update baseline assessments and perception studies for our existing mines to improve our understanding of their socio-economic realities.
  • Conduct baseline assessments and perception studies to better understand the social contexts of our newly-acquired Escobal mine in Guatemala.