How effective are international framework agreements in subsidiary companies of multinational enterprises? A case study of the international framework agreement of Anglogold Ashanti, Ghana

Abstract

This paper investigates issues relating to the two International Framework Agreements (IFA) of 2002 and 2009 of AngloGold Ashanti (AGA). IFAs have emerged as a necessary and innovative instrument of global industrial governance (Hammer, 2005) and the globalisation of business activities, and they influence financial direct investments and multinational corporations. The study investigated the effectiveness of IFA in the operations of AGA, focusing on stakeholders’ awareness/knowledge and appreciation of IFAs and the relevance and functionality of the IFA in the operations of AGA. The study occurred within the theoretical framework of sociology of law/legal sociology, which stipulates that an agreement is effective if it ensures designated effects and shapes social behaviour in a predetermined and socially appropriate manner. The methodology was qualitative with a case study design entailing data from desk research and interviews among selected mining stakeholder groups of national and local unions, AngloGold staff, government agencies, academics/researchers, other professionals and NGOs. The results showed that there was little or no awareness/knowledge of IFAs and, therefore, there was virtually no appreciation of the relevance and appreciation of these global agreements. Although AngloGold was purported to be an IFA signatory in all industrial relations literature as it deals with such framework agreements, there was no functioning IFA at AngloGold. While such agreements within the world of industrial relations are very relevant and functional especially outside Africa, this research has shown that local and national unions should be assisted by their global counterparts to deal with the challenges of international labour standards to make such IFAs very relevant and functional in Africa.