Mining rights secure access, social licence secures legitimacy; without trust, investments falter, communities fracture, reputations perish and livelihoods vanish altogether.
Every mining executive knows how to secure a mining right. It may take more time than he or she would like, but there is a process to be followed.
Far fewer know how to secure something much more valuable: trust.
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Across South Africa, billions of rands in mining investment depend not only on licences issued by the government, but on legitimacy granted by employees, communities and other stakeholders.
Yet despite sophisticated stakeholder engagement plans, detailed social performance standards and ever-expanding ESG disclosures, conflicts between mines and communities continue to erupt with alarming regularity.
The uncomfortable truth is that many companies still confuse engagement with trust.
Mining remains central to economic activity and employment, yet many communities surrounding mines continue to face unemployment, weak public services and limited economic alternatives. Jim Cooney, a Canadian mining executive, first used the term "social licence to operate" in the late 1990s to describe the informal but consequential permission that companies require from the societies in which they operate.
A building of trust
A statutory mining right is necessary, but it is not sufficient. The social licence to operate is neither permanent nor unconditional. It is earned through conduct and renewed through experience.
The essential...
