Thinking Out

Loud

13 JULY

When does a project start impacting a community?

Traditionally, impacts on a community were considered as starting with project construction.

This is mirrored in the impact assessment process, with impacts divided into project stages such as construction, operation and closure. However, more and more, proponents and government regulators are realising that impacts on a community begin long before construction starts.

One of the lessons learnt from the ‘boom’ in the coal and gas projects in Queensland and project development in other parts of the world, is that impacts on a community begin as soon as rumours of a possible project start. And managing these impacts needs to occur as one of the first steps after a project is conceived. If community impacts are not appropriately managed in the planning stage of a project, a community may withhold a social licence from ‘being granted’.

By withholding a social licence, a community can increase the cost of a project. Research has found that the biggest cost category was ‘staff time spent on risk and conflict management’. Studies of extractive industries more broadly (Goldman Sachs Global Investment Research 2009) have found that sustainability issues are implicated in 70% of project delays on the largest capital investment projects. This exceeds the delays owing to commercial (63%) and technical (21%) factors (Boutilier 2014:267 1)

 

There is a growing recognition that communities have as much authority as governments in granting permissions or ‘licences’.

Based on these experiences and learnings, project proponents are beginning to develop strategies to identify and manage community impacts that occur during the planning stage as a key element in gaining a social licence to operate. By managing impacts, being able to demonstrate a track record of accountability and transparency proponents can increase their ability to gain a social licence to operate.

There is a growing recognition that communities have as much authority as governments in granting permissions or ‘licences’. Politicians are not likely to support a project that doesn’t have community acceptance or support and proponents are increasingly having to demonstrate working relationships with their communities in order to gain regulatory and funding approval.

Just Add Lime works with proponents such as resource and infrastructure companies and government agencies to develop strategies to identify and manage impacts throughout a project’s life, including the planning stage. Key to the development of these strategies is to ‘not reinvent the wheel’, to use existing proponent policies and procedures and apply learnings from other projects.

To begin the conversation about how Just Add Lime can support your project development, please call Julie Boucher - +64 9 212 8685

1 Robert G. Boutilier (2014) “Frequently asked questions about the social licence to operate”, Impact Assessment and Project Appraisal, 32:4, 263-272

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