Studies have highlighted that local communities are increasingly opposing the development of extractives and infrastructure projects, particularly in developing and emerging markets. But many companies do not fully capture the related costs of community hostility across their portfolios of projects and are therefore underestimating the value of community engagement.
Investors (as well as lenders and insurers) are increasingly concerned about how the failure to adequately manage community relationships erodes value, through increased financial, operational and regulatory risks, but also how poor management of community issues conflict with their long-term, shared interest in promoting responsible and sustainable development.
For further reading, access the report on managing community risk here.
The purpose of the report is to build the case for improved risk management by those companies with operations that have high environmental and social impacts on local communities, particularly in high risk geographies and capital heavy industries.