June 2015

Community engagement and professional ethics

  • By Dr Sheridan Coakes, Umwelt Pty Ltd

Methods for achieving best practice in social impact assessment

In the early days of my career (around 20 years ago) when working on one of my first major project developments, and prior to any formal discussion around social licence, a prudent project manager said to me:

‘Good corporate citizenship used to be about providing jobs and contributing time and sponsorships. This definition has now changed. Inside our gates it’s no longer another world, what goes on inside our operations is of concern to the community. We are perceived as a neighbour who can cause a lot of trouble.’

In recent years it is more widely understood that effective community engagement enhances corporate reputation and underpins a company’s social licence to operate. Furthermore, the importance of assessing and managing the socio-economic impacts of projects and operations with the same rigour as environmental, health and safety impacts is also discussed. Such practice results in improved stakeholder and community relationships and better project outcomes for all.

In this vein, I’ll discuss state of the art practice in the social assessment space in Australia. As my learned project manager outlined, the definition of being a good corporate citizen has changed, and today community expectations have increased. Given this shift, it is important to ask: is social impact assessment (SIA) now a recognised fact within resource sector companies, and have many companies achieved a true social licence to operate? Or do these concepts remain largely fictional in project development and operational practice?

Defining social impact assessment

In simple terms, SIA is the process of ‘… analysing (predicting, evaluating and reflecting) and managing the intended and unintended consequences on the human environment of planned interventions (policies, programs, plans and projects) and any social change processes invoked by those interventions so as to bring about a more sustainable and equitable biophysical and human environment’ (Vanclay, 2002).

As with environmental impact assessment, sound social impact assessment practice advocates profiling and understanding communities; scoping stakeholder and project issues up front in the assessment process; assessing and predicting likely impacts, including how different segments of the community may be most likely affected; determining how best to mitigate and manage negative impacts and enhance the positive ones; and evaluating impacts over time.

In essence, SIA is a process to ensure that planned change maximises benefits and minimises costs. SIA should be proactive in determining how best to proceed in advance, and should go beyond ex-ante prediction. Good SIA practice endeavours to ensure that development is generally acceptable, equitable and sustainable.

Engagement is a key aspect of SIA, and SIA practitioners have a professional value system that advocates for early and continued stakeholder involvement in the assessment process. SIA needs to acknowledge the integration of local and scientific knowledge bases, and use a range of engagement mechanisms to identify and assess impacts and develop appropriate management responses.

While social impacts are traditionally defined in government project requirements as assessing the impacts of population change on community infrastructure and services, social impacts for good SIA practice are far more extensive and include (Vanclay, 2003) the consideration of:

  • way of life – how people live, work, play and interact with one another on a day to day basis
  • culture – their shared beliefs, customs, values and language or dialect
  • community – its cohesion, stability, character, services and facilities
  • political systems – the extent to which people are able to participate in decisions that affect their lives, the level of democratisation that is taking place, and the resources provided for this purpose
  • environment – the quality of the air and water people use, the availability and quality of the food they eat, the level of hazard or risk, dust and noise they are exposed to, the adequacy of sanitation, their physical safety, and their access to and control over resources
  • health and wellbeing – a state of complete physical, mental, social and spiritual wellbeing and not merely the absence of disease or infirmity
  • personal and property rights – particularly whether people are economically affected or experience personal disadvantage which may includ a violation of their civil liberties
  • fears and aspirations – their perceptions about their safety, their fears about the future of their community, and their aspirations for their future and the future of their children.

Sound SIA practice and the effective assessment of social impacts at a project’s onset sets a solid foundation for social licence. Essentially, social licence is not something that can be developed through one comprehensive community engagement program. It is rather an ongoing process of monitoring and evaluating a company’s social performance, keeping on top of impact identification and management, and collecting and using social/community data/information appropriately to inform company planning and practice. It is often the case that once a project is approved, companies become more transactional in their interaction with community, whereas the community views the license more in terms of the quality of the relationship that they have with the company.

photo of Mount Lyell on the west coast of Tasmania.
Former mining site at Mount Lyell on the west coast of Tasmania.

Companies may also confuse a community’s acceptance of a project in the assessment phase with approval; a community’s cooperation with trust; and the most common error, confusing technical credibility for social credibility. This is supported by CSIRO’s recent report titled ‘Australian Attitudes towards Mining’ (2014), which considers how the impacts and benefits of mining, and the relationship between the mining industry, government and society, affects the level of acceptance of mining among Australia’s citizens. In essence, what constitutes a social licence to operate for mining generally in Australia?

For example, a key finding from this study suggested that the public trust and accept the mining industry more when:

  • they feel heard by the industry
  • it is responsive to their concerns
  • the benefits from mining are shared equitably
  • there are legislative and regulatory frameworks in place to provide confidence that the industry will do the right thing.

The study also outlined that the public are more accepting of the mining industry in Australia when industry and governments work together to build trust in the industry (Figure 1). Holding a social licence to operate is therefore not only a company’s responsibility, but the responsibility of government and industry working together with communities to promote effective, constructive, and mutually beneficial relationships and social outcomes (CSIRO, 2014).

The report also highlights the importance of considering factors such as procedural and distributive justice in attaining social licence. These findings support earlier work by Coakes (1990), which illustrated that stakeholder judgement of fairness is often more influenced by the procedures used in decision making rather than by the decision or outcome itself. Within SIA practice, some of the most critical components in the management and amelioration of impacts involves the procedures used in the decision making process, and the degree and type of involvement and/or engagement prior to and during this process. Factors such as issue intensity, fairness, voice, trust and control over procedures and decisions play a key role.

Consequently there is no one-size-fits-all approach to the development of social license; each community has its own rules, specific issues and interests, with the latter likely to change over time. Therefore, a company needs to know their community or communities well, and to identify where relationship building can be enhanced as a key prerequisite for social license development and award.

In conclusion, I have briefly touched on the value of companies adopting a SIA framework that can be used not only in project assessment but to inform business planning on an ongoing basis. While IFC and IAP2 outline engagement as a process that is continuous, inclusive and involves the community in problem-solving or decision making in order to make better decisions, the reality is that the implementation of such programs varies depending upon company leadership, commitment, capacity and context.

While community involvement/stakeholder engagement is a requirement of project development, the systematic and structured framework that SIA provides for the assessment, prediction, monitoring and management of social impacts is not necessarily always found within project or operations-based stakeholder engagement programs. The lack of evaluation of both social assessment and engagement programs is, in my opinion, a core ingredient of consultation fatigue. Without a clear demonstration of how information/impacts have been identified, assessed, validated, incorporated and used to develop appropriate strategies and solutions to mitigate or enhance impacts of planned change, many stakeholders will continue to feel that their input and efforts are a total waste of their valuable time.

Compartmentalising the social aspects of assessment and approval programs will not result in effective outcomes for clients, government or community. If SIA is undertaken, it is rarely integrated within the EIA process and more often than not is also not formally assessed by government agencies when project documentation is submitted to government for their consideration. However, a recent court case in NSW has highlighted (albeit transitorily) how a project may be vetoed on social grounds, given a lack of adequate SIA and engagement practice. Such outcomes provide a stronger foundation for the more concrete consideration of social issues and impacts in project and operational development contexts.

The benefits of effective SIA practice have been espoused in many forums over many years. Frequently, guidelines for community involvement outline the need to engage or involve the community in environmental approval application processes or to address or take into account the social aspects in relation to development or activity. If SIA is referred to, its focus is usually on those impacts that can be most easily quantified, namely changes in employment, population, business and commercial activities. The less quantifiable ‘social impacts’ are less well considered, ie impacts on sense of community, place attachment, psycho-social impacts, equity and fairness, fears and aspirations of the community, etc.

In a climate where the rate of change is rapid and social impacts are becoming increasingly identified at a community level, there is a definite need for improved, more strategic assessment and ongoing practice in this space. When coupled and integrated with participatory community engagement, SIA provides a tried and tested framework – both within Australia but particularly overseas – for companies to more effectively manage social change, maintain a sustainable social licence and ensure that more effective outcomes are achieved for all parties – industry, government and community. 

References

Coakes S J, 1990. Procedural Justice and Social Impact Assessment. The interface of theory and application. Honours thesis. Curtin University, WA.

Fenton M, Coakes S and Marshall N, 2003. Social Assessment in Natural Resource Management: The Development and Application of Town Resource Cluster Analysis (TRC-Analysis). In: Becker E, Vanclay F (eds). International Handbook of Social Impact Assessment: Conceptual and Methodological Advances. Published by Edward Elgar, Cheltenham.

Moffat K, Zhang A and Boughen N, September, 2014. Australian Attitudes towards Mining – Citizen Survey. CSIRO Publishing.

Vancaly F, 2002. Social impact assessment. In Tolba, M (ed). Responding to Global Environmental Change (Vol 4 of Encyclopedia of Global Environmental Change, Series Editor: Ted Munn, Chichester: Wiley.

Vanclay F, Van Schooten M and Slootweg R, 2003. (edited by Becker, H. A., Vanclay, F) – Conceptualising social change processes and social impacts, The International Handbook of Social Impact Assessment: Conceptual and Methodological Advances, Edward Elgar Publishing.

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