EHS glossary>Safety term

The Definition of Social License to Operate

A social license to operate is the ongoing acceptance or approval of a company's activities by local communities and other stakeholders, beyond its formal legal permits.

Plain-English definition
Real-world example
Social License to Operate definition

Definition of Social License to Operate

A social license to operate (SLO) is the informal, ongoing acceptance of a company's operations by the communities and stakeholders affected by them. Unlike a government permit, it cannot be issued on paper. It is earned through trust, fair treatment and responsible performance, and it can be lost quickly after a serious incident.

What Builds a Social License

  • Strong safety and environmental performance.
  • Honest, regular stakeholder engagement.
  • Fair sharing of benefits, such as local jobs and suppliers.
  • Respect for Indigenous rights and cultural heritage.
  • Accessible grievance mechanisms and timely responses.

What Damages a Social License

  • Fatalities, major spills, dust, noise or water contamination.
  • Broken promises or poor communication after incidents.
  • Ignoring community concerns about traffic, blasting or land use.

Example of Social License to Operate

A quarry near a town received repeated complaints about heavy trucks speeding through a school zone. The company introduced a traffic control plan, GPS speed monitoring through vehicle telematics and set haul times away from school drop-off. Complaints fell and the council supported its expansion application.

Frequently Asked Questions: Social License to Operate

Is a social license legally binding?

No, but losing it can lead to protests, delays, legal challenges and refused permits.

Which industries talk most about social license?

Mining, oil and gas, energy, forestry, agriculture and large infrastructure projects.

How does safety affect social license?

Serious incidents harm workers and communities and quickly erode trust, so safety performance is central to maintaining it.

Part of SafetyIQ's EHS glossary: plain-English definitions of workplace health and safety terms.

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