Perceptions of small mining companies' executives on how to earn and maintain a social licence to operate

Ndomba, Tshiendela
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PERCEPTIONS OF SMALL MINING COMPANIES’ EXECUTIVES ON HOW TO EARN AND MAINTAIN A SOCIAL LICENCE TO OPERATE Ndomba Tshiendela Student No: 911476 INTRODUCTION The purpose of this research paper is to establish how best to earn and maintain a social licence to operate based on the perception of executives of small mining companies in South Africa. As established by Harvey and Bice (2014), community opposition to resource projects appears to be increasing, even where compliance-based social impact assessments (SIAs) and generous benefits are in place. In South Africa, government regulations require that companies conduct social impact assessments as part of their environmental impact assessment to be submitted to the authorities in order to be granted a licence. With increasing pressure from mining communities, it now seems that the legal licence by itself, is insufficient to conduct mining operations without hindrance. APPROACH The approach to this paper includes findings from 12 executives from four different mining sectors, literature reviews of academic journals and news release as well as analysis of mining laws and regulations in South Africa. 6 FINDINGS Parsons and Moffat (2014), definition of social licence to operate as an intangible construct associated with acceptance, approval, consent, demands, expectations and reputation together with findings from literature reviews, respondents and industry regulations were incorporated into a four-components triangle to illustrate this research’s approach to earning and maintaining a social licence to operate. The following four components are perceived as critical to earn and maintain a social licence to operate: - Trust & Social Acceptance (Acceptance and Approval); - Inclusive Social Impact Assessments (Expectations); - Inclusive Social Development Programmes (Demands); - Social Licence to Operate (Reputation and Consent). CONCLUSION Our findings established that open and inclusive engagement through social impact assessments and social development programmes helps small mining companies earn and maintain a social licence to operate. This was found to be consistent with the argument that the manner in which mining companies engage with local communities may also inform the communities’ acceptance or rejection of mining operations. If mining communities perceive the mining company to be fair in its processes and engagements with them, they are more likely to welcome the company and its operations (Moffat & Zhang, 2014).
MBA Thesis
Mineral industries -- South Africa,Social responsibility of business -- South Africa