What you need to know: Social License to Operate

Modern mining operations must have buy-in locally to be successful globally. This Clockworx explainer will help you get to grips with the social license to operate.

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Defining the social license

 Obtaining a license or permit to conduct mining activity on a piece of land is a regulatory process, subject to legislation and government land use controls. Government agencies have to review applications and grant access. While a company may meet all its regulatory and legislative requirements, increasingly it also has to meet broader community obligations. This is the social license to operate: the permission of the local community to move ahead with mining activity.

According to a 2019 Ernst & Young survey, over half of 250 respondents in the extraction industry said that obtaining the social license to operate was their biggest concern. This makes it the number one issue for the industry, even as it faces technological evolution and significant changes in product demand.

What those obligations are is unique to every community. Sometimes they are very clear, but just as often they are nebulous. No matter the reason for pushback, it is critical for mining companies to come to the table with an understanding of what impact their work may have on the people and their land. It is also increasingly required that mining companies prepare an exit strategy for an exhausted site. Discussion points should include:

• Land rehabilitation
• Carbon offsets
• Waste management
• Closure timelines 

Prevailing concerns

Everywhere has considerations specific to their population and geography. Most mining operations, however, also share some issues. Understanding the most frequent protests will help you formulate a plan and present your practices in a reassuring way. Most often, people are worried about:

• Environmental damage - Many people these days are concerned about climate change and damage to natural places. As a result, locals may object to mining activity both because of the fear that a mine will damage the area as well as disapproval of the mine products. For instance, coal mining particularly attracts green protests because of the coal itself.
• Exploitation - Concerns over exploitation are real, especially in developing or frontier economies. There are two facets: the land and the people. The extraction of natural resources from poorer countries to fuel the economies of richer ones has a lot of historical precedents. Locals want to know if there will be a positive, long-term investment in the immediate area. Safe working practices and fair wages are also increasingly at the top of people's priorities.
• Political disruption - Big companies can come under suspicion if people suspect that permits have been issued without due diligence. Political corruption and cronyism are major problems in many countries. The public wants reassurance that everything is above board and no one is getting special favors.
• Cultural damage - Changes to a culturally important landscape will always generate pushback. Furthermore, in some areas, indigenous land is governed differently from the rest of the country in which it is located. So there may be real legal considerations as well as social ones when it comes to mining and extraction activity. Sensitivity to religious, spiritual or cultural ties to land features can go a long way.

Mining/extraction companies should also consider how these issues impact their own operations. Land that is not responsibly managed can cause problems at other locations nearby. Unsafe workplaces may disrupt the workforce. Political unrest can result in the withdrawal of permits or vandalism of operations. And cultural damage, whether physical or emotional, can hobble a company's reputation forever. 

Finding common ground

Unlike permitting, social licensing isn't about ensuring boxes are ticked, dotted lines signed, and approvals granted. It's a communications job, and it's about building relationships with and within the local community. For that reason, it requires a different approach. But both jobs work with the same toolkit.

Clockworx's job is to integrate your existing systems with each other and with Clockworx's own capabilities. This approach provides robust obligation management. That rock-solid approach to regulations, legislation and contractual commitments goes a long way towards a company's reputation for ethical operations. And there are many more capabilities that help companies navigate community relationships. Clockworx has everything you need to secure the social license to operate.

• Stakeholder Support & Ticketing - A system that allows external users to register issues that will bring specific concerns directly in-house. Giving people direct communication access can avert operational disruption on site. Ticketing gives users a case ID that links their concerns with relevant knowledge in the database as well as anyone who works on the case. FAQs that are linked to knowledge articles or wikis can be automatically updated so everyone has current information. Clockworx's dashboard and automated notifications help get issues in front of the decision-makers faster so the resolution can go forward.
• Knowledge Management - Clockworx has a unique approach to knowledge sharing—emphasis on "sharing". Centralized rich data can be connected via wikis (with an integrated visio style drawing tool, BPMN, CMMN and DMN modelers, diagrams using text descriptions and mind maps), knowledge posts, forums, and Q&A threads. Knowledge holders can contribute expertise in whatever format works for them. The orchestration of a variety of knowledge sources provides comprehensive information on any topic within seconds. Access to sensitive information can be controlled by any criteria.
• Contract Management - Clockworx is often used to support the creation and management of kinds of contracts. This makes formalizing community agreements fast and easier. In the case of the social license, a mining company may need to provide assurance on employment, sourcing local materials, investing in infrastructure or other demands. Multi-lingual capabilities and document generation mean that the public can have agreements provided in their local language.
• Compliance & Risk Management - This is probably the most important tool for social license management. The social license is about communicating risk and mitigation to the people most likely to be affected. Clockworx's compliance tools track data such as site accidents, injuries, and water testing and link it to stored contracts, policies and procedures. The result is audit preparedness at all times and clear evidence of the company's commitment to operating within regulatory limits.
• Asset Management - Digitizing asset management is part of risk mitigation. Group, sort, track and cost-control assets across multiple locations. Equipment that is damaged or come to the end of its usable life can be properly disposed of. When assets are poorly managed, they end up where they shouldn't and are being used when they're past their best by date. Linking the asset register with geolocation capabilities, maintenance records and contractual obligations prevents environmental contamination and loss of capital.

Clockworx's tools allow mining and extraction to create a risk matrix and decision-making hierarchy that is:

• Detailed
• Accurate to date
• Shareable
• Interactive
• Integrated into all other digital operations

This kind of transparency can make all the difference in winning the trust of the community—and gaining the social license to operate.