The economy is tanking!
Jobs are critical! Highest levels of unemployment in decades!
Debt Debt DEBT!!
These are just some of the themes of the headlines that we have all been living with during COVID-19, closely supported by headlines that are concerned with getting business back open ‘at any cost’ – including the health of the nation if you follow some trains of thought.
However, prior to the COVID-19 crisis was the bushfire crisis and calls for business to take more responsibility ‘at any cost’ for the climate change emergency that was causing so much grief for Australia. And, we have been uncompromising in these calls.
The bush-fire crisis and our collective call for sectors across the country to ‘pay’ for their impact on climate change seems to be a very distant memory as I write this today.
But in a post- COVID-19 world; a world where unemployment is at an all-time high; a world where our economy is sluggish, and a world where our national debt will be at eye-watering levels, will we throw social license and our demands on companies to act ethically and morally ‘out the window’ for jobs and economic outcomes. Is social license now up for sale?
Some will say social license has always been for sale – and that’s a fair comment. But there has been more of a balance of power in this equation in recent times, remembering that social license isn’t just transactional by nature. I’ve been reflecting on whether that balance will change post COVID-19, with concern for the economy and jobs at an all-time high. Will social license become transactional and based purely on the provision of economic impact and jobs alone?
The term social license to operate has been around for some 20 years, arising in a time when business outcomes and economic outcomes had to be achieved in alignment with social and community outcomes. Prior to these times, business pretty well did what it wanted and there are plenty of examples of this - and plenty of lawsuits too.
In more recent years, communities and employees/suppliers have demanded more of business because we had more power to do so. When economies are strong consumers are strong. It is better business to be a caring one; one concerned with sustainability and have a strong purpose. In fact, some argue that ‘cost’ of social license and being a caring, community minded business had gone too far for business to be viable in some sectors. To appease communities and gain support to operate certainly increased the costs of some projects and businesses. In some cases, lack of social license, or the costs of gaining such has caused some projects to be nonviable and grind to a halt or be significantly delayed. The Adani mine project in Queensland a great example of this.
On the flip-side of this, it is fair to say social license has resulted in some powerful changes to the way a business operates and engages with its community, with significant concessions and improvements to projects and business models to get the support of customers and community. It has created more of a power balance. The more contentious the project or sector, the more a company works to appease the community. Over the last 30 years we have seen significant focus on environmental and heritage protection, and investment by organisations in the communities in which they operate and a concern about sustainability. Stakeholder and community engagement is now a standard function of business with organisations more focused on being closer to their community than ever before. And to do this has all come at an economic cost to the organisation.
But, before COVID-19 we had jobs, and everything was hunky dory. We could hold companies accountable to the moral and ethical high ground and give our endorsement of projects and work practices because we could afford to.
Will we throw all the hard work done to create more conscious companies who care about our communities out the window because of economic and employment pressures?
Personally, I don’t think so.
I’ve always believed in the idea of a healthy compromise. To do that requires dialogue and understanding.
One of the greatest gifts of social license is the creation of dialogue between an organisation or business and its community. We have, over time, realised that community and business are not mutually exclusive concepts; in fact, they are intertwined and for a successful business to be sustainable business this intertwining is critical.
In a post-COVID-19 world, I believe that social license will form the bedrock of economic recovery. We will not want to risk this happening again. Organisations and their communities will work together to move forward – and that is the important part: moving forward. We will move forward in every sense of what that means.
COVID-19 has reminded us of the fragility of our health and economic ecosystems and that each of these is important and critical for our future sustainability. Our health and the economy is also dependent on environmental factors and more than ever, we need to work towards sustainability. We can only do this through business and community working together and now we’ve reaffirmed to each other how important we are to each other; we are very well placed to work together.
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