In Australia there is a clear expectation from the general public that where resource development projects are to occur then the people who live and work in these areas should also benefit socially and economically and at the same time, any negative social, economic and environmental impacts should be avoided, or at least, minimised and managed to as low as reasonably practicable.

While the objects of environmental legislation are designed to protect the environment and provide processes for decisions to be made about natural resource development projects, ultimately decision makers are required to strike a balance between the social and economic needs of society and the impact on the natural environment. Arguably, in Australia, historically a greater focus has been placed on the biophysical aspects of environmental impact management, rather than the social and economic aspects.

In recent times though, spurred on by the most recent resources construction boom, local stakeholder concerns and aspirations about projects in remote and regional areas have become larger writ.

A social licence is both demanded and required.

Governments’ response, has been to require a greater focus by project developers on social and economic impacts, expressed through additional policy and legislation. The existing and varied policy and regulatory frameworks between Northern Australian jurisdictions, combined with the often challenging social and economic conditions common across Northern Australia and multiple responses by industry often result in sub optimal local social and economic participation outcomes. This presents a significant challenge to all stakeholders.

A more integrated and multi-stakeholder approach to social and economic impact management in Northern Australia’s resource projects will allow for more optimal management of social and economic impacts, i.e. through a more coherent social responsibility framework that could provide a foundation for enduring social licence to operate.

This article was kindly written and contributed by James Kernaghan, Managing Director at Circle Advisory Pty Ltd.