the legitimacy to enter into a social licence in the mining industry in South Africa

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Background to the research question

Understood in its most ambitious form, the social licence to operate has the potential to become nothing less than the central question for democracy in a rapidly globalising world: what right do citizens and communities have to assert control and authority over the activities of outsiders that impact their lives and livelihoods (Miller, 2014)? Social licence is, however, not seen in this way by industry or communities. The divide between us and them at the conceptual constitution level of the social licence raises questions about its sustainability and suitability as an instrument of democracy (Miller, 2014). The social licence concept originates from a business perspective and as a result, there is substantial evidence on the concept from such a perspective (e.g. Owen & Kemp, 2013). Other scholars, for example Syn (2014), have recently begun to study the concept from a sociological perspective. The author approached it from a community perspective.
The social licence has been studied for almost two decades, but the focus has been from an industry perspective (Jenkins, 2004). Even though there has been referral to the community as a stakeholder, and its suggested elevated role, there has not been an assessment of how it should go about accepting companies or the specific nuances that impact it, as a stakeholder (Viveros, 2017; Wright & Bice, 2017). This has been one of the limitations of the social licence dialogue to date, in that there has been a neglect of the community and the dialogue has been company-driven. Previous studies failed to highlight that communities are very different to industry, and their participation in the social licence process needs to factor in their reality. The social licence concept is defined for the purpose of this study as acceptance of the mining operation by the host community, which can be operationalized by a record of agreement by the community for the mine to operate. The challenge has been that companies lead the discussion on the social licence and continue to reinforce the assumption that it exists, but there is no clarity on how it is entered into from either side (Parsons & Moffat, 2014).
Furthermore, the conditions are not explicit on the nature of the agreement, how it is reached and who is involved in it (Lacey & Lamont, 2014). It is within the crucible of conflict between organisations and newly empowered communities that the phrase social licence to operate has begun to acquire significance and meaning (Miller, 2014). The term social licence was first coined in 1997 by Jim Cooney, then Vice President of International Government Affairs of Placer Dome (Syn, 2014). Since then, it has come to be understood as an intangible representation of ongoing approval or acceptance of a project by affected communities which can be withdrawn at any time. This is distinct from a legal or regulatory licence granted by a government (Syn, 2014). Social licence remains poorly defined and understood (Bice, 2014; Raufflet, Baba, Perras, & Delannon, 2013) and there is ongoing debate on whether the concept itself in its assorted guises, is useful (Owen & Kemp, 2013).
Some countries have adopted community development in their mining laws (Dupuy, 2014). In the African continent, South Africa, Nigeria, Ghana, Guinea, Mozambique, Democratic Republic of Congo and Niger have adopted such laws. Some could argue that this was an effort by the governments to anticipate, or even resolve conflict between communities and companies. The conflicts have not ceased however, despite the regulation, and the power of local communities to effect national level regulatory change has been questioned by some (Dupuy, 2014; Otto, 2013). What is evident from various studies is that governmental permits are no longer sufficient and on-going host community approvals are also required for businesses to operate successfully (Salzmann, Ionescu-Somers, & Steger, 2006).
This is particularly the case with mining companies (or other high impact sectors), which must build their own socio-political stability by engaging directly with stakeholders to develop a strong social licence to operate (Bunnel, 2013). The focus of a social licence to operate is going beyond compliance (Hall, 2014; Rooney, Leach & Ahworth, 2014). However, there are no clear criteria of what this entails and what the limits are. For instance, the social licence to operate is regarded by some as a desperate bid for survival by the mining industry (Owen & Kemp, 2013), while others regard it as a sign of a maturing industry that has understood the importance of gaining and maintaining its legitimacy (Goodland, 2012). Moffatt and Zhang (2014) state that what constitutes a social licence to operate, the process to attain it and the factors that influence it, are still uncertain. Despite social licence research spanning over a decade, most studies are descriptive (about how to acquire) and there is little understanding of acceptance of mining by host communities (Moffat & Zhang, 2014).

Table of Contents :

• Abstract
• Declaration
• Acknowledgements
• Table of contents
• List of figures
• CHAPTER 1: INTRODUCTION
  • 1.1 Background to the research question
  • 1.2 Problem statement
  • 1.3 Purpose statement
  • 1.4 Research questions
  • 1.5 Research objectives
  • 1.6 Importance of the study (expected contributions – theoretical, practical, and methodological)
    • 1.6.1 Theoretical contribution
    • 1.6.2 Practical contribution
  • 1.6.3 Methodological contribution
  • 1.7 Limits and delimitations
  • 1.8 Assumptions
• CHAPTER 2: RESEARCH SETTING AND CONTEXT
  • 2.1 Background
  • 2.2 The developing market context
  • 2.3 The South African context
    • 2.3.1 Historical factors
    • 2.3.2 Regulatory framework
    • 2.3.3 State of communities in South Africa
  • 2.3.4 Research setting and case selection
• CHAPTER 3: LITERATURE REVIEW
  • 3.1 The social licence and legitimacy
  • 3.2 Theoretical perspectives on the social licence
  • 3.3 Legitimacy theory
    • 3.3.1 Conceptualisation of legitimacy
    • 3.3.2 Justification for the adoption of moral legitimacy for the study
  • 3.4 What are the key elements of legitimacy within communities necessary to enter into a social licence?
    • 3.4.1 Power of communities
    • 3.4.2 Education level of communities
    • 3.4.3 Ability to grant consent
    • 3.4.4 Ability to oppose
    • 3.4.5 Cohesion
    • 3.4.6 Economic factors
    • 3.4.7 Legitimacy of leadership
  • 3.5 What are the key expectations of legitimacy between communities and companies, which are necessary to enter into a social licence?
    • 3.5.1 Community expectations
    • 3.5.2 Company expectations
  • 3.6. How could communities issue a social licence in terms of process followed?
• CHAPTER 4: RESEARCH DESIGN AND METHODOLOGY
  • 4.1 Introduction
  • 4.2 Research design
    • 4.2.1 Research philosophy
    • 4.2.2 Research approach
    • 4.2.3 Research strategy
  • 4.3 Research methods
    • 4.3.1 Sample size
    • 4.3.2 Cultural considerations
    • 4.3.3 Experience of the research process
    • 4.3.4 Research instruments
    • 4.3.5 Data collection
    • 4.3.6 Data analysis
    • 4.3.7 Validity and reliability
  • 4.4 Ethical considerations
• CHAPTER 5: RESULTS
  • 5.1 Introduction
  • 5.2 Elements of legitimacy necessary within communities, in order to enter into a social licence
    • 5.2.1 The emotive side of social licence
    • 5.2.2 Leadership factors
    • 5.2.3 Economic factors
    • 5.2.4. Community participation
    • 5.2.5 Weakening of community mobilisation and social resources
  • 5.3 Expectations between communities and companies
    • 5.3.1 Historical matters
    • 5.3.2 Relationship between the mining company and the community
    • 5.3.3 Complex tripartite relationship
    • 5.3.4 Community expectations
    • 5.3.5 Company expectations
    • 5.3.6 Mismatch in expectations
  • 5.4 Process followed to issue a social licence
    • 5.4.1 Community acceptance of mining
    • 5.4.2 The voice of the community
    • 5.4.3 Disagreements on projects
  • 5.5 Community perspective on effective mine-community relations
    • 5.5.1 Representative structures
    • 5.5.2 Strategic oversight by government
    • 5.5.3 Governance monitoring
    • 5.5.4 Skilled representatives
  • 5.6 Summary of findings
• CHAPTER 6: DISCUSSION OF RESULTS
  • 6.1 Introduction
  • 6.2 Proposition 1: Host communities, as a whole, have internal legitimacy factors that, when satisfied, enable them to grant the legitimacy necessary to enter into a social licence with the mining company
  • 6.2.1 Emotive aspects of the social licence
  • 6.2.2 Education levels
  • 6.2.3 Leadership factors
  • 6.2.4 Economic factors
  • 6.3 Proposition 2: Key expectations of legitimacy between communities and companies may affect the community’s ability to obtain the legitimacy necessary to enter into a social licence
    • 6.3.1 Community expectations of mining companies
    • 6.3.2 Legitimacy gap due to unexpressed expectations
    • 6.3.3 Absence of platforms for dialogue
    • 6.3.4 Community exclusion
    • 6.3.5 Governance failures
    • 6.3.6 Legal and social licence overlap
    • 6.3.7 Differences in motive influence engagement approach
  • 6.4 Proposition 3: Complex processes of underlying key expectations influence the community’s issue of the social licence
  • 6.4.1 Elements of a social licence process
  • 6.4.2 Creation of opportunities for engagement
  • 6.4.3 Multi-stakeholder representation
  • 6.4.4 Governance and accountability
  • 6.4.5 Capacity building
  • 6.4.6 Terms of engagement
  • 6.4.7 Government strategic oversight
• CHAPTER 7: SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS
  • 7.1 Introduction
  • 7.2 Research design and methodology
  • 7.3 Discussion of the results
    • 7.3.1 Research question one
    • 7.3.2 Research question two
    • 7.3.3 Research question three
  • 7.4 South African model for social licence
  • 7.5 Contribution of the study
  • 7.5.1 Introduction
  • 7.5.2 Theoretical contribution
  • 7.5.3 Methodological contribution
  • 7.6 Areas for future research
  • 7.7 Limitations of the study
  • 7.8 Implications of research
  • 7.8.1 Regulators
  • 7.8.2 Practitioners
  • 7.8.3 Communities
  • References
  • Appendices

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