The Social Operating License Of Corporations: Mining Companies And Their Constituents

Several authors from the CSR literature have proposed the term “license to operate” when referring to companies and their activities in the relevant communities (Visser, 2008, Post, Preston & Sachs, 2002). Others have implied this term when referring to the types of responsibilities a company needs to have in order to be able to exercise its activity in the society (Blair [1994] 2004, Clarke [1998] 2004 and Philips 2003). Consultancy companies have already coined the term: social license to operate, especially when referring to mining activities “existing when a project has the ongoing approval within the local community and other stakeholders, ongoing approval or broad social acceptance and, most frequently, as ongoing acceptance” (http://socialicense.com /definition.html). Media has also asked this question, not only rhetorically, but as a result of new ideas and developments in the business arena (Maidment, 2010http://www.forbes.com/sites/davos/2010/01/28/does-business-need-a-social-licence/) – do businesses need a social license to operate? This view is particularly important when we discuss the case of corporations which are exploiting non-renewable resources, like oil and mining companies. In their particular case, the debate is whether the license to operate should be provided by a local community, a series of stakeholders or by an entire nation. For this purpose, the authors will examine the case of Rosia Montana Gold Corporation (a mining company), a situation where the company was a failure both in obtaining the social and the environmental license to operate and will draw a few conclusions that might help other companies in the future.