We enjoy putting the project work aside occasionally and working on our practice. The International Association of Impact Assessment (IAIA.org) recently held it annual conference in Brisbane and we were fortunate to be able to again present a paper on social impact management practice.
The paper is set out below ahead of the proceedings being available. Get in touch with firstname.lastname@example.org if you’d like to work on any of the ideas the paper canvasses. Enjoy.
Analysis of two impact assessment cases compares the objectives and practical requirements of early-stage small-scale extractives exploration and the construction phase of a very large multi-location mega project.
In business management discussion of quality focus on customer specifications. SIA is different in that is serves ‘customers’ relatively able to specify their needs (think project owner’s team or government regulator) but also needs to advance the interest of the proponent by understanding what quality means to those poorly able to articulate their expectations of a formal process (for example, many indigenous peoples or a small business sector).
An impact assessment that is right-sized for the risks associated with the current phase of a project can add significant value at each capital investment decision-gate. The challenge is managing a phased approach so stakeholders support a strategy of distinctive phasing that is responsive from the initial stages.
The presentation works with an analogy of Australian Rules Football to explore the opportunities presented in the two cases for being clear about strategy and tactics in development of a game plan, SIA as iterative design, co-design as problem-sharing and community empowerment, and shifting from heroic proponent to useful partner in collective impact initiatives in a way that might mirror the contrasting roles of team owner and coach.
This article compares social assessments of two projects at different stages in development and with different risk profiles, to demonstrate the benefits of staged SIA studies. In thinking of SIA as a human-centred design tool we argue for a de-emphasis on detailed ex-ante impact assessment in favour of more robust adaptive management throughout the lifecycle of a project. There are implications for leadership in social performance.
Problems with social impact management
We commonly find environmental and social impact assessments on a project critical path awaiting sufficient concept definition to predict impacts. In practice, this approach sets up two competing ways of knowing:
• the sponsor’s focus is on schedule and analytical task simplification to reduce uncertainty; and
• stakeholders in the host community also want to eliminate uncertainty but expect integral thinking on joined-up management and assurance of outcomes rather than mere management commitments to actions.
The practitioner can feel like meat in the sandwich of engaging with uncertainty to understand complexity whiles trying to develop stakeholder support for workable strategies and monitoring.
SIA is essentially linear process (Figure 1) with potential for elongating study activities through phases of a project lifecycle (Vanclay et al, 2015). Study leaders still largely see SIA and public engagement as a late feasibility task. There is too, a lack of focus on adaptive management and assessment follow-up. This is despite, for example in Australia, firms such as SKM (beginning in 2008) presenting sub-components of the SIA task (e.g. political risk analysis, stakeholder issues mapping) as components of early feasibilities in its project development manual. Staged problem definition and study were features of an SKM ‘swim stream’ of activity for a ‘community’ discipline in a multi-disciplinary manual covering the earliest feasibility through to closure/abandonment. Around the same time in Australia, regulators aimed to integrate SIA with other community strategic plans (e.g. Queensland’s Strong and Sustainable Resource Communities Policy).
Applied academics (Franks and Vanclay, 2013) identified that SIMPs should have monitoring and review processes to link the assessment to ongoing management. Others have developed frameworks (DFID, 2001; Smyth & Vanclay, 2017) that promote consideration of livelihoods in the broadest sense and claim to be applicable iteratively during a project’s lifecycle.
In contrast, stakeholders frequently expect SIMPs to be able, ex ante, to describe intended management outcomes and have detailed metrics. This is particularly problematic where SIMPs are a feature of statutory approval processes.
1) An assessment of a proposed mine in Sulawesi, Indonesia included a government-approved EIS document (ANDAL) prepared by an international consultancy. We examined EIS and resettlement related documents as part of a due diligence review by a potential investor. This document review supported 3-day site and surrounds walkover.
The review found that the mining project falls in the IFC Category A and triggers all eight Performance Standards. Further data and analysis were required to confirm or rule-out the presence of Indigenous peoples and critical cultural heritage (and the associated application of FPIC). The social baseline was both outdated and incomplete and the project had yet to scope a resettlement action plan process. Crucially, there was a lack of information on adjacent protected forest which appeared to support livelihoods and cultural practices. This forest contained reported endangered species but the study had not performed a critical habitat assessment. There was an absence of analysis of any effects on downstream water users including a micro-hydropower facility. It is common for projects in exploration phase to lack the resources to deal with myriad issues and this example emphasises the value of focusing on critical issues early in the project lifecycle.
2) The other case is the Ichthys LNG project where I was Lead Environmental and Social Adviser at owner INPEX and my responsibilities included the internal and external negotiation of the SIMP and its monitoring and reporting regime.
The LNG project had undertaken an initial SIA early in the design (FEED) phase as part of Northern Territory and Australian Government approvals. However, this SIA focused only on the largest of more than a dozen temporary worker accommodation facilities and failed to look at other effects on Darwin and its people or any social performance issues at other work sites in China, The Philippines, Korea, Thailand, and Indonesia. Remedial work was required to meet international standards and became a condition precedent for project financing so reducing the Project’s negotiating leverage.
In contrast to the small mining project, this project was well-resourced. However, it had failed to develop a recognisable social impact management system and its assessment lacked definition on key matters. Despite this, specifications and budgets had been locked in with the tier one EPC contactors making changes to management plans more complex and potentially cost-prohibitive.
An impact assessment that is right-sized for the risks associated with the current phase of a project can add significant value at each capital investment decision-gate. In scoping the studies for each phase requires discipline to only seek answers the questions a project review board for the upcoming phase see as critical. Remember, the capital investment decision-gate process serves more to end bad projects at the earliest possible stage (protecting study expenditure, capital investment on early works and reputation) as it is to control considered, iterative project design.
SIA, as commonly practised, suffers from being linear, inflexible and intolerant of ambiguity. And as such, does not support the capital investment decision-gate as well as it could.
Popular models of SIA processes (Figure 1) assume linear progress or at least continuous momentum towards the goal: scoping, baseline, shocking the baseline, impact characterisation, significance assessment, application of the mitigation hierarchy, and development of a M&E framework.
But SIA and SIMP are a structured conversation with stakeholders about change. So why should learning about concerns and how we might manage these together be linear? Issues will emerge as stakeholder better understand project activities and the receiving environment. Working out how to manage often familiar issues in a unique context is in large part about governance and community leadership. Often a project or program required a new governance architecture and so is subject to local politics. Viewed like this, we might expect the process to be challenging and exhibit haphazard progress – frankly, to be a bit messy.
Going back to our two cases: the small mining project worked through a linear sequence of an approvals-led process rather than an iterative set of studies scoped to illuminate unknowns and mitigate identified risks. The linear approach failed to engage local stakeholders or identify the key issues for a focused program of work. Consequently, the study was not bankable.
Government officials pressed the LNG project to follow a process developed for different regulatory contexts. The government required the SIMP to state all management measures for all impacts in all phases and present an associated indicator set and data collection strategy with the benefit of only preliminary consultations with a narrow group of government agencies. In addition, the SIMP’s focus on domestic government needs and processes meant the Project executive board had no visibility of any human rights or other social performance risks in the project’s extensive global footprint.
As we have seen, SIMP guidance often asks for mitigations that are SMART (Specific, Measurable, Agreed, Realistic and Timed) – sometimes for the life of the asset. While it is useful to have agreement on the characteristics of an impact (and on its root-causes) and a political/capability analysis of the parties potentially involved in management of the desired outcome, practical management will be affected by politics and the approach may need to change as local politics change. In this context, rigidity in planning is not only unhelpful, it is fantasy. Sponsors and lenders need to not only allow flexibility, but promote agile responsiveness.
In our case of the small Indonesian mining project: it had mitigation statements in a conditionally-approved environmental and social statement (AMDAL process) but these failed to convince the investors that the operator understood the risks and they were manageable within the provisional budget. More importantly, the potential investors had no information that project-affected people were prepared to engage to carry out remedial social planning or if any material capability gaps existed.
The LNG project mostly resisted regulator pressure. to lock-in mitigations and outcome measures for the entire project. Instead it issued an interim SIMP for pioneering construction works ahead of those works commencing and secured agreement to the establishment of powerful and agile stakeholder reference groups through which to develop the plan for the main construction phase. The preliminary SIMP document removed political barriers to engagement with peak groups and citizens around meaningful strategies and monitoring metrics.
There is a reasonable expectation that conducting a SIA and developing a SIMP will reduce project uncertainty and establish risk treatments. However, stakeholders often expect monitoring and evaluation frameworks established in planning to provide metrics that can be written into approval conditions, contract specifications and sometimes, political manifestos. But given that we’re not talking about turning inputs like concrete and asphalt into buildings and roads but people’s ideas into complex social outcomes, the setting of goals and selecting indicators with limited engagement is just informed guessing. The commitment of significant resources to the notion we can predict the future without ambiguity is a mistake. Monitoring such metrics might tell us more about how good we are at informed guessing than it does about how well we are managing risks to vulnerable people’s rights. Tracking the success of social programs
It’s an axiom that we should measure quality in customer terms, but SIMP quality monitoring measures tend to be binary activity completion, inputs or outputs – rarely outcomes of importance to the community. Reporting on SIMP implementation has tended to be concerned with demonstrating that planned activities have occurred – the promise was kept. There has tended to be less emphasis on whether management was effective, who benefited and what learning occurred.
It is important that ex-ante SIA predicts residual significance in (for example, in terms of extent, duration, reversibility etc) but leveraging opportunities and tracking the success of social program management requires additional tools. We can borrow more useful tools from the social impact investing community.
Using frameworks such as that offered by The Impact Management Project (Figure 2) or the Impact Genome Project will usually require tolerating ambiguity in qualitative measures. Data analysis can be seductive in illuminating an issue but human interpretation is required for learning to occur and for programs to be adjusted in a timely manner (Silver, 2012).
Our practice can benefit from the discipline shown by our environmental planner cousins that often have EMPs with strategies set out in an adaptive Trigger-Action-Response approach. The inherent uncertainty around others’ actions means SIMPs tend to shy away from taking responsibility for outcomes and targets. Working in isolation from stakeholders that may be potential social program implementation partners promotes this risk-adverse approach. In contrast, co-design of programs (and their logical frameworks) with stakeholders can promote impact literacy, collective adaptive management capability and meaningful metrics. More importantly, this co-design builds the human relationships required to deal with the ambiguity inherent in management social issues and collective impact management approaches.
Going back to our cases: the small mining project provisioned a sum for resettlement but, in the urgency to demonstrate firm cost calculations consistent with national practice, it overlooked international standards on the quality of the resettlement program. This was of material interest to potential investors. The project failed to appreciate potential linkages between activities and impacts yet these would quickly have become apparent with stakeholder engagements.
So, what’s all this got to do with Australian Rules Football? How can AFL illuminate the above methodological problems of linearity, inflexibility, and a failure to tolerate ambiguity?
Direct attacking tactics (Figure 3) are an option in AFL.
But given the pitch dimensions, a team will involve most of the 18 players in a phase of play. They will work the ball forward by passing sideways or back to a team-mate who is open or run backwards to avoid being tackled. Forward progress will be frustrated when players are tackled, fouled, lose the ball, have to win it back or stop for injuries (Figure 4).
In this way, the ebb and flow of an AFL game resembles the process of developing and managing a SIMP together with stakeholders. The coach cannot hope to give instructions on the precise moves that will lead directly to goals but rather sets a pattern of play in a game plan and then makes adjustments or interchanges (substitutions) as appropriate. The implication is we must place much more emphasis on the adjustments (interchanges of technical disciplines, recycling back to previous ideas or even change out of personalities) as the SIMP development process plays out, and less on planning for things that cannot be fully understood until we are deeply engaged with those experiencing or managing the impact. Cyclical continuous learning is more useful than adherence to a linear process.
Coaches are well paid but they can’t predict precisely how a game will play out. When the pressure is on, we look to them to make an adjustment to tactics or personnel on the field. We value the adaptive management skills over their ability to know with certainty how the game will unfold. The implication is that social impact management leaders need to secure the discretion to adapt to local politics and changing community dynamics and then to adjust social impact management programs while keeping focused on the over-arching goal.
We ask coaches to win championships. We don’t ask coaches to describe precisely how each goal will be scored before they’ve assessed the fitness of their players or how the other team will line up. SIMPs have become dense and intimidating but there is a lack of transparency around the follow-up on intended outcomes.
The implication for our practice is that SIMPs should focus less on program design and more on programme governance design including capability development.
Framed like this, we can view the expectations of project sponsors as unrealistic. But their needs are real; schedule pressure is real. How, then, to reconcile these needs with the insights we get from looking to Australian Rules Football?
- It’s best to think of a project plan to develop the SIMP as a game plan.
It should contain: an analysis of each impact management partners objectives, strengths and weaknesses; the tactics we might use in foreseeable circumstances; and team role responsibilities. Acceptance that the practitioner/leader (acting like an AFL coach) may need to change the formation or personnel at some stage and should contain an authorities process to manage that change.
The typical SIA approach emphasises a mechanical connection between activities and receptors, not how people are working together to manage an opportunity or impact. Given what we’ve said about the importance of local political actors to the success of social impact management, how many SIMPs do you see that seek to measure levels of mutual trust? How often does stakeholder sentiment tracking include opportunities for feedback on how well an organisation learns from its mistakes? The preoccupation with technical matters at the expense of relationships would be like an AFL coach working to improve the training ground facilities or collaborating with boot manufactures at the expense of focusing on interactions between the players in his charge.
- Processes of SIA leading to a SIMP should be better phased
Progressive definition of management plans should be aligned with capital investment governance decision-gates so that each phase of study only answers questions that are critical to the decision at hand and associated critical unknowns. It’s a long season and you can only win one match at a time.
- Impact managers need to lead more and manage less.
Detailed SIMPs handed down by the Sponsor are less useful than detailed participative planning with stakeholders at the individual partnership level.
SIMPs (as game plans) need to be just detailed enough to characterise the issue and set out the strategic considerations for management of desired outcomes. The emphasis needs to shift from detailed activity planning to including performance levels as triggers for contingent measures (much like the coach going to the interchange bench) and agile management (akin to dynamic shifts in tactics during a game).
Involving partners in detailed planning and development of workable metrics will tend to generate ownership and an obligation to add value or lose program funding. The impact management practitioner doesn’t need to monitor or second guess the impact makers – but they need to be there to support, monitor and be agile in decision-making when things don’t work out. This is a leadership challenge for impact assessors. In AFL terms, the coach is not on the field and cannot kick a goal. The coach’s role is to establish the game plan, ensure team functioning, encourage from the sideline and actively intervene only when impact management goals are endangered.
I perceive a crisis of confidence in the SIA discipline and you might say we’re in overtime. SIA has promised much but despite our best efforts, projects are often associated with increases in poverty or at least unintended adverse consequences. Corporations and governments that have bought into SIA continue to suffer from low levels of trust. A gradual evolution in practice is unlikely to be enough to rescue the credibility of the discipline and build the trust critical to the social licence to operate. Instead, we require a more radical change of practice and it starts with how we view social impact assessors as leaders of this revolution.
DFID. (2018). Global Learning for Adaptive Management (GLAM). Available from: https://devtracker.dfid.gov.uk/projects/GB-1-205148/documents. [Accessed: 27/3/2019].
Franks, D. & Vanclay, F. 2013 Social Impact Management Plans: Innovation in corporate and public policy. Environmental Impact Assessment Review 43, 40-48.
Impact Management Project. (nd). Building global consensus on how to measure and manage impact. Available from: https://impactmanagementproject.com/.
Pasco B (2019) The Little Red Yellow Black Book: An Introduction to Indigenous Australia (4th Edition) Australian Institute to Aboriginal and Torres Strait Islander Studies, Canberra
Rita Metzenrath (2017). The AFL’s Aboriginal Origins. Available from: https://aiatsis.gov.au/news-and-events/blog/afls-aboriginal-origins. [Accessed: 28/3/2019].
Silver, The Signal and the Noise, 2012, Lane Allen
Smyth, E. & Vanclay, F. (2017) The Social Framework for Projects: a conceptual but practical model to assist in assessing, planning and managing the social impacts or projects, Impact Assessment and Project Appraisal, 35:1, 65-80
Vanclay, F., Esteves, A.M., Aucamp, I. & Franks, D. 2015 Social Impact Assessment: Guidance for assessing and managing the social impacts of projects. Fargo ND: International Association for Impact Assessment.