We are all familiar with the term ‘corporate social responsibility’ (CSR) – a concept that’s been around for over 50 years and covers a wide range of considerations, from conducting business operations sustainably, acting in an environmentally responsible manner, and ensuring that the actions of your business have a positive social impact on the community in which it operates.
The idea of a ‘social licence to operate’, meanwhile, goes one step beyond CSR, essentially referring to an informal licence granted to an organisation by the community. Like CSR, SLTO covers a range of social responsibilities that fulfil an organisation’s commitments to the wider community.
In recent years, the expectations placed on corporations to act in a socially responsible manner has increased, with a YouGov survey revealing that 87% of Australians think businesses have a responsibility to do social good. But are organisations giving these responsibilities the importance they need?
It would appear not, with Deloitte’s 2018 Global Human Capital Trends report showing that only 23% of decision makers in Australia classed social responsibility as a top priority, while more than half (53%) stated it was not a focus. Clearly businesses have a long way to go to step up their social responsibility efforts and ensure they are working to obtain and uphold their SLTO.
In this article, I’ll be exploring what the SLTO means for today’s organisations and how outplacement plays a key role in fulfilling the social responsibility requirements that contribute to the SLTO.
The Social Licence to Operate Explained
First appearing around 20 years ago, the term ‘social licence to operate’ – SLTO – means the acceptance granted to an organisation by the community. Just as there are many formal legal and regulatory requirements a business must fulfil to operate legitimately, the SLTO can be seen as the range of informal social requirements that need to be met in order to gain community acceptance.
The Ethics Centre breaks down SLTO into three key components:
- Legitimacy: Adherence to the accepted standards or ‘rules’ of the community – whether these are legal, social, cultural, formal or informal.
- Credibility: The provision of true and clear information to the community and the capacity to fulfil any commitments made.
- Trust: “The willingness to be vulnerable to the actions of another”. Trust and confidence are key pillars of SLTO; they are hard to obtain and all-too-easy to lose.
With a 2017 global study showing that 77% of consumers would choose to pay more to purchase from companies demonstrating community responsibility, it’s not hard to see why there is a growing view that social responsibility is beneficial not just for the community, but for the long-term financial performance and shareholder value of the company.
How does outplacement fit in with SLTO?
The practice of outplacement plays a crucial role in a business’ efforts to act in a socially responsible manner. When considering the CSR requirements of your organisation, therefore, providing outplacement support to departing employees should be viewed as a key practice.
By offering outplacement services, you are:
- demonstrating a commitment to fairness towards outgoing staff members;
- helping to minimise fear and stress in surviving employees; and
- showing to the wider community that your organisation is willing to support its members at all times, regardless of whether they are still a part of the institution or not.
Clearly, providing outplacement is an act of corporate social responsibility. But how does it support the maintenance of the SLTO more specifically? To explore this, let’s look at how outplacement fits in with each of the three components of SLTO identified above:
Outplacement and Legitimacy
While it would be cynical to view outplacement as a ‘box-ticking’ exercise, providing comprehensive support to outgoing employees helps to ensure that organisations are meeting their legal obligations in this area.
As adherence to legal requirements is an expectation of the community, the fulfilment of these obligations ensures the company is ‘playing by the rules’ and upholding the standards demanded of it by the wider community.
Outplacement and Credibility
When a business employs an individual, they are (or should be) making a commitment to support that person at every stage of the life cycle. Outplacement makes good on this commitment and proves to the community that the business is taking responsibility for the actions which have impacted the departing employee.
Furthermore, by reassuring surviving employees that they too will be treated with dignity and respect should they face the same circumstances, outplacement also fulfils the ongoing commitment to supporting their current staff members
Outplacement and Trust
At its most basic level, outplacement sends an abundantly clear message that your organisation can be trusted to do the right thing by its employees (current and departing).
By providing support and treating exiting staff members with respect, you are proving – internally and externally – that you are committed to upholding your corporate social responsibilities and acting in a way that is trustworthy.
Career365’s affordable online outplacement programs – delivered via online training modules and video-based coaching – coupled with video conferencing via Zoom, Teams or Skype can be accessed from any location, at any time, on any device, making them ideal for a COVID-19 environment.
If you need support or advice on outplacement services for retrenched employees in the wake of the COVID-19 pandemic, visit www.career365.com.au to find out more about our fully online outplacement programs.
Greg Weiss has authored two books about career transitioning and is soon to release a third. He has deep expertise in outplacement and employee onboarding, and is the Founder of Career365 (formerly CareerSupport365) – a leading Australian employee transitioning firm, specialising in outplacement and employee onboarding.