Chapter 3: Three Types of Social Licence to Operate: The Ethical and Operational Risks of Authentic, Deceptive, and Default SLO Approaches

The ‘social licence to operate’ (SLO) – referring to community acceptance by critical stakeholders – is an important concept in contemporary business ethics, governance, and risk management. In this chapter, we advance a new conceptual framework, arguing that there are three distinct approaches that companies may adopt with respect to community concerns about operations – and that these give rise to three distinct types of SLO. An Authentic SLO is achieved when the organisation genuinely intends to meet and exceed existing standards and social expectations. We give a ‘four Cs’ delineation of Authentic SLO, based on four pillars of conduct, consequence, credibility, and connection. The Deceptive SLO arises when the organisation approaches community concerns as a public relations and branding exercise and employs manipulative and misleading ethics-washing and green-washing to achieve social acceptance. The Default SLO occurs when the organisation relies on a pre-existing presumptive acceptance and aims to avoid all public attention, staying out of sight and out of mind. While all three approaches can successfully lead to community acceptance (and therefore SLO), the three types of resulting SLO differ markedly in terms of ethical, legal, and operational risks. Ultimately, the type of SLO achieved contributes critically not just to the degree of social acceptance the organisation enjoys, but also to the moral significance and operational resilience of that acceptance.