Steps to Securing Social Licence to Operate by Developing Epistemic Trust

Organisations often fail to muster their internal resources to relate to communities in ways that engender a strong social license to operate. This failure is said to be costing Australia billions in lost productivity.  Accurate and recent figures are hard to come by, but Davies and Franks (2014) estimated that community opposition has led to more than $20bn in federal infrastructure projects being shelved.

The Ethics Centre explains a social license to operate as the informal permission granted to an organisation by a community that may be affected by its activities. It is made up of three components: legitimacy, credibility, and trust.

  • Legitimacy: the extent to which an individual or organisation plays by the ‘rules of the game’. That is, the norms of the community, be they legal, social, cultural, formal or informal.
  • Credibility: the individual or company’s capacity to provide true and clear information to the community and fulfil any commitments made.
  • Trust: the willingness to be vulnerable to the actions of another. It is a very high quality of the relationship and takes time and effort to create.

Side-stepping a detailed debate about what constitutes this social license to operate, it is apparent that failure has much to do with communities being unwilling to bestow their trust. So, understanding what affects trust is key to the effectiveness and alignment of public affairs activities.

Recently I spoke at a business leaders’ forum on techniques for building and keeping trust. Here I share the essence of that contribution.

Two ways organisations think about uncertainty and how that undermines trust

Misunderstanding the relationship between uncertainty, risk and community opposition has two extremes. One, where the expert team falls short in demonstrating the empathy and curiosity required to fully appreciate the full range of concerns in a potentially-affected community. And the other where the expert team sees dysfunctional conflict as inevitable. 

There are two unhelpful myths:

Myth #1: We all have common reference points for the analysis of risks and benefits

One barrier to building trust is a clash of thinking styles between typical experts and the layperson in the community. Experts break down uncertainty into manageable chunks. They tend to view risk as what can scientifically be known about consequences. They seek an evidence base about the statistical probability of an adverse event occurring. This allows them to form views about comparative risks and population-level consequences. As a result, what they analyse is an acceptable level of risk or a level of risk that has been reduced to as low as reasonably practicable (ALARP) in their opinion. They have a preference to agree to achievable commitments.

The layperson (under stress) assesses risk intuitively. They are looking for a binary analysis: is what is proposed change good/safe or is it bad/unsafe. They want to deal in terms of discreet events. There is no meaning in a 0.25 chance of a catastrophic outcome – there is only a risk that a catastrophic outcome that could happen.  And rather than population-level implications, the layperson will tend to care most about personal or household consequences. They are looking for integral thinking and joined-up solutions. They want concrete assurances about outcomes rather than a commitment to achievable actions.

Myth #2: Because there is a risk or hazard, there will inevitably be distrust in the community and we have to press on regardless

The other side of the coin is the belief that because there is a risk attached to a project or program, then someone must bear the risk; and therefore, there must be winners and losers. The thinking goes that it is inevitable that proponents will face opposition from those who perceive themselves as losers. 

Understanding the potential for vigorous opposition needs to be more nuanced. There are a lot of factors that determine the degree of conflict expected. One way to think about what is likely to influence the degree of opposition is to use a checklist of Peter Sandman’s 12 factors:

  • Control – how much control or input do stakeholder have about what is proposed?
  • Track record – has the proponent previously lied or tried to ‘spin’ a situation?
  • Responsiveness – does the organisation ignore or attack objectors?
  • Equity – how is benefit shared compared to where the burden of risk falls?
  • Voluntariness – does a community agree to assume a risk?
  • Nature – is the hazard man-made, artificial and industrial or from natural sources?
  • Familiarity – is the activity or the context in which it takes place new?
  • Memorability – can the community picture a similar, previous adverse outcome?
  • Dread – is an adverse outcome inherently dreaded (eg cancer)?
  • Catastrophic potential – would an adverse outcome be large scale and concentrated in time and space?
  • Uncertainty – has the issue been well studied or is the science disputed
  • Moral relevance – is there is any immorality, it is managed by those we trust?

If I’m right on these two myths, the implication is that there needs to be a greater focus on how risks and benefits are typically communicated. This is the business of risk communication. But more focus too on how we think about people’s rights and how we seek trust from people affected by policies, programs and projects.

Five insights into how we trust other people

It’s useful to summarise some of the research about how trust is formed, won and lost. The work on risk communication is particularly relevant when events threaten a social licence to operate.

  • Trust determination theory

When people are upset, dominant patterns of behaviour can come to the fore. People who are upset tend to distrust that others are listening, caring, competent, honest and hardworking. They can be distrusting of the messenger or the team trying to engage with them. Covello has said: “People need to know you care before they care what you know.”

Understanding the potential for such a mindset has implications for how communities can be engaged. There are opportunities to build trust in all stages of problem-solving: defining a problem, deciding the criteria against which potential solutions will be assessed,  participating in generating a range of options, selecting the preferred solution, and then monitoring implementation of the solution and evaluating the effectiveness and efficiency of the program or project.

  • Negative dominance theory

When people are under stress, they often think negatively, focusing on the negative meaning of words and gestures. Communications should be crafted with the knowledge that if there are too many negative words, then a disproportionately greater value may be assigned to them. Words that are powerful in provoking negative reactions include: shouldn’t, don’t, can’t, won’t, never, nothing and none.

  • Mental noise theory

People who are upset have difficulty hearing, processing and remembering information. It is estimated that mental noise can reduce the ability to process communications by up to 80%. There is a tendency for people to focus on what they hear first. There are limits on the number of messages they will accept, and there is a limited window for communication.

It is illustrative that in emergency management situations, the Rule of Triple T and the 27/9/3 template are often used. The rule of Triple 3 is three messages repeated three times (with three supporting facts, ideally from three credible sources). 27/9/3 asks for public statement summaries of 27 words in nine seconds to convey three key messages.

  • Rule of credibility transference

This rule says that a message will take on the credibility of the highest credible source that publicly agrees with it. This means that if we hope to build trust with stakeholders, we must pay attention to the credibility of the person delivering or endorsing the message. This is particularly important because the rule of credibility reversal says that:

                “When a lower credibility source challenges a higher credibility source, the lower credibility source further loses credibility.”

  • Attachment theory

The essence of this theory of interpersonal relations is that self-esteem, ability to control emotions, and quality of relationships are all affected by attachment style. Attachment style is a way of relating to others based on formative experiences as an infant. This style can show itself when a person suffers from attachment-related stress.

The theory has an evolutionary basis. It says that humans are the only animal that can learn by knowledge transfer (rather than practical demonstration or copying). But this trait presented a dilemma in early history. If some information (sources of food, identification of danger/enemies) is vital to daily survival and there are multiple sources of information, whose information do you trust?

Bowlby theorised that an evolutionary response developed in us whereby the infant bonds with the primary carer. The infant develops an internal working model of itself and its place in the world through that carer’s attention. If the infant perceives the carer is responsive to its needs (including food, warmth and comfort, but also responding to its noises and gestures) a channel of trust is opened. Through this channel, the carer’s knowledge of the world and relationships can flow to the child. They are helped to understand themselves and relationships. Epistemic trust is said to exist. The result is what is called a ‘secure attachment style’ and it is thought that around 55% of people experience this optimal pattern of attachment.

Without developing this secure attachment style, navigating the world can be challenging and confusing. Ainsworth defined two types of insecure attachment styles evident in adults as a result of these formative experiences: Anxious and Avoidant. Main added Disorganised. About 20% of people develop an Avoidant/Dismissive style in response to negative emotions and 15% are said to be Disorganised when distressed. Concerning trust, we may see a response on a scale ranging from mistrusting (hyper-vigilant) to being overly credulous.

The implications for community engagement of stakeholders having these back-up styles when under stress are profound. To engage people in creative problem-solving, we need to create a space of psychological safety.

We all have a personal narrative: a working model of who we are and our place in the world. Psychiatrists working with attachment theory appreciate that if a second person understands that narrative and can communicate that understanding back to the first person, there is a probability that epistemic trust can be developed.

Cartoon image of 1st person's self image and 2nd person trying to understand how 1st person sees themselves
Top left: Man A has a self-image. Top right: Man B does not understand that self-image. Bottom right: after further talking, Man B has a good view of how Man A sees himself. Bottom left: Man A feels that Man B sees him as he sees himself and a pathway opens for epistemic trust to exists.

At the level of community-wide engagement processes, similarly, the proponent seeking trust should demonstrate they understand how potentially-affected people in the community see themselves: their collective self-narrative.

In social impact assessment, for example, we develop trust by the participative development of a baseline narrative about a place and its people. Crucially, this is often done with the participation of the community itself: by storytelling about a place’s past, present and possible futures; facilitating PhotoVoice (low-literacy accessible) photo essays on what makes a place unique; vox-pop video interviews on concerns and aspirations for the future; artworks that tease out spiritual connections and valued places; as well as statistical profiles.  Community participation in building the baseline means when that profile is presented back to the affected community for validation, there is likely to be strong recognition of that self- image. At the personal and collective level, there is greater potential for epistemic trust. This means that information provided by the proponent during subsequent stages of community engagement is more likely to be accepted and the proponent trusted to manage a procedurally fair process.

Five benefits of investing to develop trust

The World Economic Forum’s Leadership, Trust and Performance Equation Project has suggested there are five benefits from making investments to improve levels of trust in an organisation.

  1. Better business processes and conditions

The study pointed towards trust leading to greater productivity of new ventures; better access to capital, intellectual and natural resources; and quicker project execution. Mutual expectations are likely to be clearer when trust is high.

  1. Enhanced innovation and entrepreneurship

Higher trust appears to correlate with a creative culture that supports innovation. The study showed that a lack of trust in a partner organisation is one of the main reasons leaders don’t sanction collaboration with others.

  1. Loyal, productive and engaged workforce

Employee turnover is expensive for any organisation and there is a correlation between higher employee trust and company profitability.

  1. Strong external relationships in the value chain

Supplier cooperation has an important role to play in ease of doing business, and trust is said to drive around a quarter to a half of overall customer loyalty.

  1. Greater ability to withstand shocks and crisis

Higher levels of trust are consistent with higher propensity to forgive and faster recovery of trust. The study found 57% of the public will believe negative information after hearing it once or twice. Conversely, when an organisation is trusted, only 25% of the public will believe negative information heard the same number of times.

Five steps to earning greater trust

Based on our experience in social impact management and high-concern community engagement, we believe there are five key ingredients for developing higher levels of trust. Consider using these as a checklist to assess your organisation.

  1. Develop an explicit model of trust formation behaviours

Developing a collective view inside the organisation about the important drivers of trust (be that attachment theory or another approach) beats hands down a culture where the needs of external stakeholders and how their trust is earned is not explicitly discussed. Within a stakeholder engagement management system, policy intent needs to translate into meaningful behavioural expectations, staff competency programs, detailed guidance for common scenarios, and credible procedures for seeking advice in situations of ambiguity.

  1. Be trustworthy

Being trusted as an organisation requires leadership in the organisation to worthy of trust. Being authentic and trustworthy is applied ethics and requires not only the leadership to articulate a philosophy – to explain why trust is important to organisational success – but to model trustworthiness in daily dealings.  Training exercises with challenging trust-threatening scenarios is one way to strengthen the muscle memory of being trustworthy under pressure.

  1. Act trustworthy

A commitment to the practice of being trustworthy calls for investment in key interpersonal skills:

  • Listening – active listening skills and traits include: paraphrasing, experiencing empathy, being curious, providing feedback and controlling non-verbal communication
  • Competency and expertise – while not sufficient to earn trust, competency in the subject matter is necessary
  • Honesty and transparency – the more challenged the social license to operate, the more transparency is likely to be required to earn trust (see Arnstein’s Ladder of Citizen Participation)
  • Dedication and commitment to a fair resolution – to us, this is the trait that sets good community engagement practitioners apart

Organisations need to have skill competency profiles for key stakeholder facing roles, conduct systemic training needs assessments, provide engaging training in these interpersonal facilitative skills and have a process to verify competency.

  1. Ask for trust

Preparing to ask for trust implies inter-dependence between an organisation and its stakeholders. If an organisation is genuine in seeking input to a problem-solving task (for example, a challenging situation for policy development, evaluating a program that seems not be delivering, or sensitive design of a project to get more value from the capital spend), it is asking for help. Being honest about the limitations of its competency means being prepared to be vulnerable. There is little scope to hold onto all the power: a sharing of power is implied.

Making the extent of this sharing of power explicit helps clarify role expectations and this should lead to greater stakeholder satisfaction and effectiveness of the engagement. Good practice consultation makes decision-making power-sharing explicit by publishing a stakeholder engagement plan or at least a summary of the intent and scope.

  1. Monitor for trust

A genuine commitment to building higher levels of trust will require a way to make organisational progress transparent and allow for corrective actions to be taken when progress is not as planned. There is a suite of tools available to suit organisations of all sizes and stakeholder contexts. Often qualitative work with key stakeholders is indicated by a trust dashboard that may also include survey responses, stakeholder panels, social media sentiment analysis and critical incident analysis. The important step is to develop a robust process of evaluating stakeholder engagement that takes in both routine and project engagement with stakeholders.

Securing higher levels of trust

A good place to start building a trust improvement program is to conduct an audit of specific engagement against sector relevant standards such as the International Association for Public Participation Quality Assurance Standard. You may wish to look deeper using one of several diagnostic community engagement maturity assessment tools. If you would like to discuss some options, please get in touch with us.

Sociometry develops stakeholder engagement and social performance management systems and conducts operational reviews of external affairs functions. We have particular expertise in crisis and emergency management and planning contentious land-use developments including waterfront/port and tourism developments.  

To find out more, book a call with Daniel Marsh at https://calendly.com/danielmarsh