Five Keys to Social License Success

Sustainable Development in the Minerals Industry

Vancouver, CanadaJuly 14, 2015

Wayne DunnProf. of Practice in CSR (McGill)President, CSR Training Institute

Why Me? Who is Wayne?

• Saskatchewan Farm Boy

• Accidental Academic

• 2 seasons diamond drilling (Gold/Uranium)

• 25+ years of practical, global CSR/social license experience• About 100 projects (programs, policies, strategy, relationships, innovation,

etc.) Many very complex (e.g., industry HIV/AIDS strategy in South Africa and Papua New Guinea). Some great successes, at least one social license failure.

• Over 40 countries spanning all continents (urban, rural, indigenous, traditional, etc.)

• Numerous awards (1st private sector winner of World Bank Development Innovation Award, Stanford Case Study, etc.)

• Developed McGill | ISID Executive Program on CSR Strategy & Management and taught hundreds of participants globally.

• Professor of PRACTICE in CSR (note – still practicing and learning!)

Presentation Outline

• Look at growing social demands on mining?

• How these demands can provide a five-point strategic framework for social license actions and responses?

• Industry Social License

• Social License partnerships?

• Discussion

Social LicenseCatching a cloud in a net

Social License

You can FEEL it

You can SMELL it

But, you can’t SIGN it

You can TASTE it

You can TOUCH it

Growing Societal Demandson Mining• Consultation (formal/informal,

history, structure, FPIC, closure)

• Access to land (who/how approved)

• Benefit sharing (what’s in it for everyone)

• Project approval (who approves? when? how?)

• Environmental monitoring (Who monitors? Trust, Communication, Local Involvement)

Consultation• From exploration to closure• Formal/Informal (relationship history across

ownership changes)

• Structured Processes (who leads, who participates, roles & responsibilities, end points)

• Starting point (exploration, permitting, construction)

• ICMM Position Paper http://bit.ly/ICMMFPIC

• defines FPIC as process based on Good Faith Negotiation through which Indigenous Peoples can give or withhold consent

• commits members to work to obtain the consent of Indigenous Peoples

• includes supporting commitments that apply to most interactions with indigenous communities

• defines how to engage where government has primary responsibility

• addresses how to move forward where differences of opinion arise.

Land Access

• Role of the State (strength of land cadastre systems)

• Role of Community (who leads,

who participates, roles & responsibilities, traditional land owners, end points,)

• Role of Landowner

• Role of Traditional Leaders

• Process (purchase, lease, negotiation,

relocation, pricing, etc.)

• Dispute Resolution

Benefit Sharing

• Compressive Community Development Agreements (structured frameworks, bi-lateral, tri-lateral/multi-dept, multi-lateral, ODA involvement)

• Local Content (employment,

procurement, training)

• Local Industry/Diversification

• Infrastructure (direct funded, co-funded, tax credits [Works for Investment])

• Resource Access (water, small scale mining, agriculture)

Project Approval

• Informal (local, national, international pressures: Tambo Grande, Rosia Montană)

• Structured Local Processes (Binding

Referendum/Honduras)

• Informed Processes (State decision informed and influenced by local [and other] input)

Environmental Monitoring

• Who monitors? (company, community, state, 3rd

party)

• How trusted is the regulator (objectivity,

impartial, informed, communication)

• Local involvement (Is the community involved? How? Starting when?)

• Communication (Is information available? How?)

Industry Social License

• Oil Sands - Alberta

• Uranium Mining –Saskatchewan

• American chefs signing up to boycott Canadian seafood because of the seal hunt

• Industry Associations (ICMM, Mining Chambers, CIM, PDAC, AME BC, etc.)

Sustainable Development in the Minerals IndustryVancouver, Canada, July 14, 2015

Increasing mandatory and voluntary compliance

• ICMI - International Cyanide Management Institute (ICMI)

• Conflict Free Gold Standard

• Voluntary Principles on Security and Human Rights

• EITI

• Global Reporting Initiative

• Voluntary Principles

• ICMM

• IFC

• Equator Principles

• ILO

• Accountability

• Many, many more

Relationships & Trust

• Crosscutting themes (relationship history across ownership changes)

• History of relationships (reputational capital of project and owners –new owners don’t reset reputational liabilities)

• Transparency and legitimacy of processes (environment, permitting & approvals)

5 keys to Social License Success

1. Consultation (formal/informal, history, structure, FPIC, closure)

2. Access to land (who/how approved)

3. Benefit sharing (what’s in it for everyone)

4. Project approval (who approves? when? how?)

5. Environmental monitoring (Who monitors? Trust, Communication, Local Involvement)

± Industry Social License

BEWAREThe Industry/Community

Capacity Gap

We’re all TryingBut, often its not working

Industry Efforts Community Efforts

Clear roles & responsibilities

Organizational Structure/Vehicle

Cultural Understanding

Adequate Resources

Execution Capacity

Governance

Partnership Strategy

Politics/Business separation

Other partners (ODA/IFI)

Social License Story

CSR Knowledge Centre

Below are some recent articles and publications on Corporate Social Responsibility and stakeholder engagement that you may find interesting.They are short and pragmatic, hopefully helpful and interesting. Read them, download them, share them and feel free to comment on them by sending us an email.

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The CSR Training Institute is a private, mission driven organization. It began from a lifelong passion for developing ground-breaking ways that business can serve both shareholders and society.

We are a small, committed team focused on helping organizations of all types to create and capture value at the intersection of business and society.

Discussion

For any questions or comments

Wayne DunnProf. of Practice in CSR (McGill)President, CSR Training Institutewayne@csrtraininginstitute.com