Social License to Operate – Significant Issue for Mining and Resources Industry
Central Queensland is a resource rich region. Mining is a major contributor to the regional economy. CQs resources and agricultural sectors are benefitting from record investment linked to increased global demand for metals, mineral, coal and food. There are also many opportunities for support services, such as, renewable energy, transport and logistics.
This blog focuses on community engagement and development, to the benefit of the stakeholders as well as to society in general and local communities in particular.
What is SL
‘Social License to Operate’ (SLO) is the popular term used to describe company engagement with stakeholders and issues in communities. It has generally been used to describe the informal acceptance or approval that a local community extends to mining operation or development.
SLO is a significant issue for the mining industry, as a lack of community acceptance can cause delays to secure funding and government approvals and extra costs to projects. Community and stakeholder attitudes can change over time and maintaining a SLO is an ongoing process that lasts the life of the mine.
The challenge however is that the SLO is a subjective concept and is not a physical ‘license’ or piece of paper. There is no issuing organisation or authority. Basically, SLO is based on who your stakeholders are and what they think of you. We believe that it is imperative that the success is focused on tangible, local, on-the-ground relationship building.
When a company has a social License to operate, there is low and infrequent conflict between stakeholders and the company. The company is seen as an inextricable and valued component of the social and economic fabric of the community. Conversely, where there is a failure to gain and maintain Social License, this can lead to conflict, delays or cost for the proponents of a project.
The main features of SLO
A SLO rests upon a good community relations foundation, including both community engagement and development. The main features are:
- Should be earned by the corporation or project through its actions
- Should be ‘granted’ by the local community in preference or in addition to the national or wider community
- Must be constantly renewed through active, broad-based community engagement for the life of the project
- Needs to be nurtured, not just paid attention to at the times of crisis.
Unless a company earns the licence, and maintains it on the basis of good performance on the ground, and community trust, there will undoubtedly be negative implications. Communities may seek to block project developments; employees may choose to work for a company that is a better corporate citizen: and projects may be subject to ongoing legal challenge, even after Government permits have been obtained, potentially halting project development.
How do you know if you have it?
SLO is difficult to measure. One method used to measure is the expression of sentiments within the community, these include: