“Social license to operate has been ranked as a top six risk over the last five years as it represents a consistent long term challenge.”Helen Adair
Executive Director, Climate Change and Sustainability Services

The consistent ranking of maintaining a social license to operate within the top six risks over the last five years demonstrates it is an important element of doing business as opposed to being a compliance exercise.

While the reputation of being a company which does the right thing can provide a competitive edge through better access to capital and solid government relationships , it is essential in being able to access the next project. Trends which challenge companies include:

• Increased expectations — stakeholders such as governments and communities want more from mining and metals companies operating in their jurisdictions, from basic financial returns to benefits for the community and the country. To stay ahead, companies need to be proactive, timely and transparent in their dealings with these stakeholders
• Acquisition challenges — Acquisitive companies need to be increasingly aware of the standards of their potential targets, moving quickly to set clear expectations of how they do business and build firm partnerships with stakeholders
• Changing how business is done — companies are changing how they approach business by focusing more closely on building strong partnerships with stakeholders and communities right from the start so they are engaged and understand every aspect of the project.

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Contacts

• Ernst & Young’s Global Mining & Metals Center