The rise in strikes, labour unrest and service delivery protests signal that the social contract is under pressure, as people are becoming more frustrated with the pace at which reform is taking place in all sectors of the economy, especially mining, said director of the Centre for Sustainability in Mining and Industry Caroline Digby at the Sustainability in the Resource Industry Summit, in Johannesburg, last month.

She said that the structures and legacies of apartheid, such as the migrant labour system, persisted and that the current development trajectory had to change.

“Mining companies have an important role to play in increasing the development aspects of their activities, supporting local economic development through local employment, skills training, preferential local procurement and enterprise development.”

Digby added that this needed to be supported by government policy that rewarded these activities and encouraged collaboration.

Although many of the required policy actions are known, she pointed out, implementation was hampered by a lack of political consensus. Digby also stated that the National Development Plan identified a deficit in trust between business, labour and government that needed to be reversed if progress was to be made.

“Equally, communities need to feel that local mines are improving their wellbeing and prospects. Rebuilding trust takes time and effort but is necessary if mining’s social licence to operate is to be strengthened,”

She added that companies needed to be honest about the potential risks involved in their operations and explain what they were doing to mitigate these risks to build trust and legitimacy.

Digby noted that failure to establish or maintain this social licence opened the door to unrest to various degrees, such as work being halted, owing to protests, injury and death, which had been the case at Marikana, in the North West, in August 2012.

“The concept of social licence will help transform relationships in the mining industry. When [industry] thinks about social licences to operate, [it] needs to think about how it is managing the discussions on resource nationalism and it must be meticulous about how that argument is framed when it comes to value-added economic linkages.”