Social+License


 * Social License**

Social license or social license to operate (SLO) is defined by Gunningham, Kagan and Thornton as “the demands on and expectations for a business enterprise that emerge from neighborhoods, environmental groups, community members, and other elements of the surrounding civil society.” [1]

Social license is an element of corporate social responsibility. It is premised on the idea that while regulators grant permits, it is communities that grant permission. Widespread community or special interest group opposition to a particular project or undertaking can influence the decisions of elected officials and regulators, preventing projects from proceeding or adding delays or new costs which damage the business case for the project.

__Social License and the Environment__

Social license is particularly important when it comes to projects that have significant environmental impact, such as pipelines or resource extraction like mining and oil and gas production. The importance of maintaining a social license to operate is considered an important element of operation, not merely a regulatory compliance issue. Failure to maintain a social license to operate can be a significant business risk. [2]

The widespread movement against the Keystone XL pipeline[3] and opposition to the proposed “fracking” of shale gas in New Brunswick, for example, is a result of a lack of social license.[4]



A social license is a complicated procedure without clear rules or requirements. The sentiment must be shared by, often, networks of individuals or groups. That raises an important question: what is consensus? Does a vocal minority have the moral authority to scuttle a project the majority of the community might approve? It is difficult to determine when a social license has been earned[5].

__Social License and Social Contract__

Social license could be considered a contemporary analog to Thomas Hobbes’ “Social Contract” theory which argued that some sacrifice of personal liberty to the king or government was necessary to escape the chaos of the “the state of nature.”[6] In the case of social license, individuals, working in informal or formal structures, are allowing regulators to grant permission for projects with the expectation that there will be some tangible gain (usually jobs or economic growth) for individuals and communities.

__Structure of Social License__


 * **//Social Legitimacy://** Social legitimacy is based on established norms, the norms of the community, that may be legal, social and cultural and both formal and informal in nature. [7]
 * **//Credibility://** The capacity to be credible is largely created by consistently providing true and clear information and by complying with any and all commitments made to the community. [8]
 * **//Trust://** Trust, or the willingness to be vulnerable to the actions of another, is a very high quality of relationship and one that takes both time and effort to create. [9]

[1] Gunningham, N., Kagan R. and Thornton, D. (2004) Social License and Environmental Protection: Why Businesses Go beyond Compliance //Law & Social Inquiry// Vol. 29, No. 2 (Spring, 2004), pp. 307-341 [2] Business risks facing mining and metals 2012-2013 Retrieved May 9 from http://www.ey.com/GL/en/Industries/Mining---Metals/Business-risks-facing-mining-and-metals-2012---2013-6-Social-license-to-operate [3] http://www.tarsandsaction.org/ [4] http://www.cbc.ca/nb/features/fracturedfuture/ [5] What is the social license? Retrieved May 9 from: http://socialicense.com/definition.html [6] http://plato.stanford.edu/entries/hobbes-moral/ [7] What is the social license? Retrieved May 9 from: http://socialicense.com/definition.html [8] Ibid. [9] Ibid.