Coined in the late 1990s, the term “Social License to Operate” gained prominence, particularly within the Mining Sector, as it signifies the lawful authorization obtained from communities where major projects are carried out.
In Perú, companies engaged in projects that carry significant socio-environmental implications face a major challenge in obtaining and upholding the Social License to Operate (SLO), thereby securing their viability. This license doesn’t manifest as a physical permit but rather as an intangible endorsement granted by the community in which the company conducts its operations. It relies on the community’s acceptance of the company’s activities and projects and is indispensable for its long-term success.
The acquisition of this license is not a straightforward or isolated procedure. Rather, it is an ongoing journey where project proponents must collaborate closely with a diverse range of stakeholders to achieve higher levels of empowerment and involvement that go beyond conventional project management. After obtaining the license, it becomes vital to maintain its integrity throughout the project’s lifespan, necessitating active management.
Exploring the Significance of the Social License to Operate (SLO)
The Social License to Operate holds immense significance for multiple reasons. Firstly, it enables companies to operate with enhanced security and operational stability, mitigating the risks and expenses associated with social conflicts resulting from inadequate management in this sphere. When a community actively partakes in the benefits that projects can bring, it becomes a collaborative partner in the company’s endeavors, reducing the likelihood of conflicts or blockades.
Another crucial aspect of maintaining a robust SLO is the substantial enhancement of an organization’s reputation. Effective management showcases the company’s responsibility and dedication to sustainable development, resonating with conscientious consumers who prioritize proper environmental and community stewardship by businesses. Such positive reputation attracts and retains customers who seek out socially responsible companies that prioritize the well-being of the environment and local communities.
The SLO presents new avenues for business growth. Companies possessing this license gain access to untapped markets and customers who prioritize sustainability and social responsibility. Consequently, it contributes to the sustainable development of communities. Companies that obtain the SLO typically invest in social and environmental initiatives that bring benefits to the communities in which they operate. Such investments foster positive relationships, promote local development, and create a mutually beneficial environment for both the company and the community.
A concise guide: step-by-step process for acquiring the Social License to Operate
Conduct a context analysis:
- Understand the social, economic, political and environmental environment in which the company operates.
- Identify the key stakeholders with whom you need to interact to obtain the SLO, such as the community, local authorities, non-governmental organizations and other interest groups.
- Assess the expectations and concerns of these key stakeholders.
- Establish an SLO policy:
- Define the company’s commitment to social responsibility and sustainable development.
- Establish clear principles for SLO management.
- Assign responsibilities within the company for the implementation of the SLO policy.
- Build relationships with the community:
- Establish effective communication channels with the community, such as public meetings, newsletters and social networks.
- Promote dialogue and community participation in decision-making.
- Demonstrate transparency and accountability in all activities.
- Implement social responsibility programs:
- Develop and implement programs that benefit the community, such as educational, health, employment, and economic development projects.
- Involve the community in the definition and execution of these programs.
- Monitor and evaluate the impact of these programs in the community.
Possible problems to be observed
Inadequate understanding among the community about a company’s operations can sow seeds of mistrust, particularly when incidents with negative consequences come to light. Furthermore, the inability to foster open communication with the community can lead to potential conflicts in the future.
Taking the business perspective into account, it is essential to consider the capacity to carry out social responsibility initiatives that aim to minimize adverse effects. Additionally, closely monitoring any modifications in legislation or regulations that influence or contribute to the management of the Social License to Operate is crucial.
What can Socionaut do to help companies in Perú acquire the Social License to Operate?
Socionaut is a company specialized in SLO management for projects in complex contexts. Its consultants have been exposed to mining, oil, infrastructure, and energy megaprojects, to which it has contributed throughout the different project cycles. Its team of experts can help you to:
- Conduct a context analysis
- Establish an SLO policy
- Build sustainable community relationships
- Implement social responsibility programs
In addition to:
- Identify key stakeholders with whom you need to interact to obtain the SLO.
- Develop effective communication plans to inform the community about your activities
- Implementing social responsibility programs that benefit the community
- Monitor and evaluate the impact of your activities on the community.
Socionaut brings forth its expertise and knowledge to support you in developing and implementing ethical initiatives. These projects are aligned with the goal of achieving Sustainable Livelihood Outcomes (SLO) and nurturing enduring relationships with stakeholders, particularly the communities within your sphere of influence. Visit their website to explore further details on how they can assist you in attaining your business objectives sustainably.
