A social licence to operate legitimacy test: Enhancing sustainability through contact quality

Abstract

The social licence to operate is a notoriously ambiguous concept that encompasses a patent normative heterogeneity, making the emergence of a widely accepted standard capable of settling controversies on its legitimate use seem unlikely. To cope with this issue, the article builds a model (adapted from Arnstein’s ladder of public participation) to measure “contact quality,” used here as a proxy for gauging the legitimacy of the social licence to operate. This model is tested on a case study from the minerals and energy sector (Base Titanium Mine in Kenya). Our findings show that a company can move up and down on the legitimacy scale, depending on the contact quality with company stakeholders. The interest of providing a social licence heuristic is to make sense of the theoretical controversies surrounding this concept and to offer also realistic guidance to practitioners searching to understand where a firm sits on the legitimacy scale, to enhance transparency and accountability of its social licence to operate and ultimately improve business practice.