Mining Conflict and the Politics of Obtaining a Social License: Insight from Guatemala

Mining as a development strategy has become ubiquitous throughout the developing world. However, if mining firms want to take advantage of the most mineral-rich terrain in developing countries, they must engage with the communities living near projected mining operations. Firms may sometimes use violence to quiet local opposition, but increasingly, they will seek a “social license to operate.” This term refers not to the legal requirements firm must obtain, such as governmental and environmental clearances, but rather the elusive support of the affected local population that will help a firm avoid project delays, maintain a positive public image, and prevent further regulation of the mining industry. There is a lack of research on how firms pursue a social license to operate. Through a qualitative case study of a mining conflict in Guatemala, this article addresses two questions: First, how do mining firms obtain a social license to operate, in practice? Second, what results from this process? Using a mix of qualitative data collected in 2009-2011, the article analyzes how a large Guatemalan construction materials firm, Cementos Progreso, sought a social license to operate in the indigenous municipality of San Juan Sacatepéquez, Guatemala, and with what results. An alliance of firm and state constructed new institutions for citizen participation in local governance, promoted from within them the idea that mining was complementary with development, and backed up this discourse with tangible results. Government transparency and accountability improved, as did provision of basic services. The findings suggest that the local state, especially institutions designed to encourage citizen participation in local governance, can play a crucial role in determining whether and how mining firms can operate.