Mining, Capacity-Building and Social License: Making the Links

This paper aims to increase our understanding about existing capacity-building approaches and their implications for obtaining a social license to operate in the mining industry. The notion of ?capacity building? is gaining increasing currency in the mining sector in developing countries due to a rapid rise in the globalisation of mining operations. Capacity-building is conceived here as a process that lasts after the mine-cycle, intended to provide local mining communities with tangible skills and knowledge to gain meaningful employment in mining or other industries relevant for the local economy. Building community capacity to understand and effectively respond to these transformations is vital for obtaining a social license to operate, as it promotes sustainable and locally relevant development. Accountability mechanisms such as global norms and international standards increasingly highlight the need to build capacity among stakeholders, particularly among local communities adjacent to mining operations. International frameworks and mining companies have embraced the notion of capacity-building as a driver to assist corporate social and operational performance. However, this narrow understanding of capacity-building through the prism of corporate social responsibility and ?best practice? is preventing the industry from meaningfully impacting communities and maintaining a social license to operate. This latter notion is being widely embedded across multiple industry sectors, as a social and economic reward from mining companies to compensate communities for natural resource extraction and gain social acceptance. Although both concepts are widely recognised in the minerals industry, insufficient attention has been paid to the implications of applying a top-down (mining-orientated) or a bottom-up (community-orientated) capacity-building approach for obtaining a social license to operate, or indeed how these two concepts are linked and applied in practice. At times, communities lack the necessary capacities in the form of education and skills to deal with mining-led livelihood transformations. This is preventing both mining companies and communities from forging sustainable livelihoods and responding to mining-led livelihood transformations, a situation that is creating discontent among communities and reducing the possibility of obtaining and renewing a social license to operate for the industry. Based on a review of current scholarly debates, accountability mechanisms in the mining industry and fieldwork findings in Colombia, this paper will contribute to an understanding of the implications of existing capacity-building approaches that support a social license to operate.