1) What is social license and what does it contribute?

The Social License to Operate emerged in the late 1990s as a response to growing concerns regarding the social and environmental impacts of business activities, particularly in extractive, energy and mining industries. The SLO refers to the process through which a company earns acceptance and support from local communities and stakeholders to carry out its activities. It is an implicit agreement based on trust, respect, and the recognition of the rights and interests of those involved, and on how these actors perceive the benefits and consequences of operations on their environment and quality of life.

2) Why is SLO no longer enough?

Despite being recognized as a key factor for the success of mining operations, the SLO has faced several criticisms, including the following (Owen & Kemp, 2013):

• Lack of clarity: The SLO lacks a precise definition and concrete criteria for how it is obtained, measured, and sustained over time. This uncertainty often results in poorly managed decisions that affect project feasibility and community trust.
• Exclusion of marginalized voices: The SLO frequently prioritizes the perspectives of more organized groups, excluding vulnerable communities and limiting its effectiveness as an inclusive, participatory tool.
• Insufficient consideration of local complexities: The SLO often oversimplifies local realities, overlooking the social, economic, and political dynamics of territories. This can lead to inaccurate assessments and jeopardize the long-term viability of projects.

Given the complexity of mining projects, a more systemic approach is needed, one that evolves into comprehensive Social Performance, which not only meets immediate expectations but also strengthens companies’ social management systems for both internal and external social issues (Owen & Kemp, 2018).

3) Why is it important to transition toward a Social Performance approach?

The International Council on Mining and Metals (ICMM) defines Social Performance as “the results of a company’s engagement, activities, and commitments that may directly or indirectly affect local communities and stakeholders, and that influence the quality of its relationship with them.” In this context, Social Performance is supported by integrated management systems, relevant information, and the capacity to properly address social and human rights risks, impacts and opportunities, aligned with international standards and local commitments.

The ICMM (2022) outlines the main objectives of Social Performance:

• Prevent harm to people and communities throughout the lifecycle of operations.
• Ensure respect for human rights.
• Contribute to social and economic development of affected populations and engage more broadly with society on key issues.
• Build and maintain trusting relationships between companies and local actors for mutual benefit.

This approach helps to align business activities with stakeholder expectations regarding human rights and community wellbeing. Successful performance requires understanding local dynamics and building trusting relationships that generate long-term value for both companies and communities.

It is essential that Social Performance be managed holistically across the entire organization, involving every area and operation. This means that teams must collaborate to develop a unified strategy that incorporates social considerations across all stages of the project lifecycle.

There are several ways in which Social Performance can enhance business success across different areas, including the following (ICMM, 2022):

4) What tools exist today?

There are various tools and mechanisms available for companies seeking to strengthen their Social Performance. Among them, the ICMM Social Performance Maturity Matrix (2022) stands out as a tool that enables mining and metals companies to critically evaluate the maturity of their social management systems. Its purpose is to diagnose these systems to identify strengths, gaps, and opportunities, supporting more systematic social processes and continuous improvement within organizations.

The Maturity Matrix assesses four key aspects of Social Performance, each with five levels ranging from “Nascent” to “Leading Practice.” These levels broadly describe the evolution of social management systems. The four aspects assessed are:

• Leadership and culture: Refers to the level of awareness within the organization regarding Social Performance, internal policies, and the visible commitment of senior leadership (CEO, executive committee, and board of directors) who set the “tone from the top.”
• Integration and systems: Considers three main elements: strategy (purpose and outcomes of Social Performance), structure (accountability and reporting lines), and management systems.
• People: Refers to the capacities and competencies of Social Performance professionals, as well as the awareness, knowledge and skills of the broader workforce.
• Metrics: Encompasses leading and lagging indicators of Social Performance outcomes, key performance indicators (KPIs), and management dashboards.

Figure 1 - ICMM's Mining with Principals, Social Performance Maturity Matrix, pg 4

The tool enables companies to identify their maturity level and determine the actions needed to progress to the next stage. Depending on the operational context, some aspects of Social Performance may be more developed than others, providing deeper and more accurate insight into the areas requiring priority attention.

5) Success Story

A successful case of implementing the ICMM Social Performance Maturity Matrix took place through an advisory engagement with a leading Chilean mining company. The project was conducted collaboratively by WSP specialists from Chile, Australia, and Canada, and included the following components:

• Compilation of lessons learned and international best practices: Based on case studies focused on conflict resolution between mining companies and Indigenous peoples.
• Exploratory gap analysis in community engagement: Using the ICMM Social Performance Maturity Matrix. This involved gathering and analyzing both primary and secondary information.

Through this approach, the client was able to:

• Gain access to international best practices that informed the development of strategies and plans to address current challenges with local communities and Indigenous peoples.
• Evaluate and understand its maturity level within the social management system using the ICMM tool, which provided a clear view of its current position.
• Identify strengths, gaps, and opportunities within internal social management procedures and systems, as well as within its stakeholder engagement strategies and community relations.
• Receive targeted recommendations to strengthen its social management system and advance to the next level within the ICMM Social Performance Maturity Matrix, offering a long-term pathway for continued progress.

By embracing a holistic Social Performance approach, mining companies can not only meet stakeholder expectations but also foster resilient, mutually beneficial relationships with the communities in which they operate. This commitment to continuous improvement, transparency and responsible engagement is essential for building long-term value, mitigating risk, enhancing reputation and securing the social foundation that underpin operational viability. Ultimately, Social Performance is a strategic advance in an increasingly demanding global context. 

References

• ICMM. (2022). Tools for social performance.
• Kemp, D., & Owen, J.R. (2018). Social performance gaps in the global mining industry: A position paper for executives. Centre for Social Responsibility in Mining, Sustainable Minerals Institute, The University of Queensland (Brisbane).
• WSP. (2023). Supporting a just transition – from social license to social performance.