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Management Undertaking project that could stir up public backlash requires accepting ‘social licence’

Some companies need to be adept at public negotiations. Developers and construction companies, for example, can only gain approval for their projects if the public is sufficiently supportive. We’re all familiar with development projects in our community that were stalled by public outrage. Significant pipeline expansion in Canada has been essentially blocked for many years. Google’s Sidewalk Labs effort has run into strong headwinds. And Amazon fled New York after community backlash.

So what do you do if you are undertaking a project that could stir up a public backlash?

It perhaps requires accepting Prime Minister Justin Trudeau’s term “social licence,” which he used for pipelines. That phrase is ignored or mocked these days, but is still a valid concept. It indicates clearly that some corporate efforts require public consent, in effect a licence to go ahead that may transcend legal restrictions, regulations and even guidelines, such as civic planning acts for developments.

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That can be hard for some leaders in a capitalist system to accept. They believe in the freedom to undertake their projects – we supposedly live in a free country – and view their efforts as gloriously positive for communities.

But when a developer unveils plans for a project that might for example obscure the view from the home of the most freedom-loving, pro-capitalist citizen in a community, that individual will quickly be at the socialist public library borrowing a copy of Saul Alinsky’s Rules for Radicals, with guidance on how to stave off the incursion. “Not in my backyard” is a primal fear, overcoming political and economic philosophy.

Consultant Roger Dooley says smart business leaders avoid fights, as Amazon eventually did in New York. “No smart business leader would choose to expand operations in an area where powerful factions are openly hostile,” he says on LinkedIn. In some cases, there is only one community for a project. But where there’s choice, avoid the fight. Take your money and ambitions elsewhere.

Negotiations expert James Sebenius, a professor of business administration at Harvard University, says business leaders and civic supporters in these situations try to seek consensus among all stakeholders but that can be self-deceptive. “In a city like Queens, riven with many factions and political agendas, Amazon would never have reached full consensus and didn’t try."

Requiring full consensus in a multiparty deal makes you hostage to the most extreme or reluctant party. When you can anticipate unconditional opponents, or skeptics with diverse agendas who may opportunistically band together, don’t hand them blocking power,” he writes in Harvard Business School’s Working Knowledge.

The goal should be to build “sufficient consensus” enabling you to form a winning coalition despite the rise of citizens attempting to block the effort. That boils down to gaining enough support among enough of the right parties to win agreement on your proposal and allow successful implementation.

You will need a negotiation campaign that involves monitoring local currents of opinion. He points to reports Amazon did not hire a single New Yorker to continuously engage with community groups to build support. Instead, most of its representatives shuttled between Washington and Manhattan. “On-the-ground presence would have provided invaluable local intelligence on fast-changing currents of opinion,” he suggests.

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You need to go beyond top elected officials and elites, identifying allies throughout the community even before you need them. “A project sponsor should systematically work with community groups and local leaders so they feel intense personal and tangible stakes in the proposal,” he writes.

From the beginning, he says you need to actively listen to the concerns of potential opponents and address them to the extent possible. To get them to support what you plan, you need flexibility – sometimes endless flexibility – on how it will happen. It always surprises me when developers are intransigent about changes to their project. Their claims that any changes will make the project financially unsustainable inevitably fall on deaf ears. Before committing to a project, the numbers have to be scrutinized with the assumption the ideal or even next-best scenario won’t win.

In a populist era, businesses have to assume that it will be easy to stir up antipathy to their projects, whatever the positive community impact. Business leaders need patience, flexibility and smarts to win social licence.

Cannonballs

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