Roxanne Scott, Golder Associates Ltd.
Social Impact Assessment (SIA) is a process of analyzing, managing and monitoring the intended and unintended social, economic, health and well-being consequences, both positive and adverse, of projects.
In addition to meeting regulatory requirements and corporate social responsibility policies and procedures, SIAs can support sustainable project development outcomes for people and communities, by aligning mitigation and benefit enhancement measures with a community’s sustainable development goals and objectives. In this way, SIA is integral to understanding and supporting a project’s effect on, and contribution to, sustainability.
The increasing explicit requirement for SIA within environmental assessment legislation illustrates the emerging paradigm shift in environmental assessment methodology globally. Under this model, the requirement to assess social, economic, health and cultural impacts, in addition to environmental impacts, goes beyond mitigation of adverse impacts, to the development of project planning objectives focused on net gains and positive outcomes that contribute to better environmental, social, economic and cultural conditions of local communities and regions within which a project is situated.
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A Canadian example
An example of this emerging paradigm towards a more wholistic consideration of project impacts and its contribution to sustainability is Canada’s recently-enacted Bill C-69. It mandates changing the name of the country’s federal review agency from the “Canadian Environmental Assessment Agency” to the “Impact Assessment Agency of Canada” and the name of the legislation from the “Canadian Environmental Assessment Act” to the “Impact Assessment Act (IAA)”. These name changes are significant in that they direct the requirement to address the studied impacts—social, economic, cultural and health as well as environmental, and reflect the principle of sustainability.
Bill C-69 also includes a requirement for gender-based analysis, to determine differential social, economic, cultural health and well-being conditions, and differential project impacts, and mitigation and benefit enhancement requirements across vulnerable and marginalized groups.
There is also a new mandatory early planning and engagement phase with Indigenous groups, as well as with regional and local government, public and stakeholders, and mandatory consideration and protection of Indigenous knowledge alongside other sources of evidence in impact assessments.
Lastly, there are more formalized processes for Indigenous groups to conduct their own impact assessments within the regulated impact assessment process.
Federal authorities have indicated that the purpose of the IAA includes fostering “sustainability”. This means the Minister or Governor in Council’s public interest determination pertaining to the project must also consider sustainability as one of the factors in rendering a final decision on a project.
The above changes illustrate that the Canadian federal government is aligning Canada’s impact assessment regulations with well-known international environmental and social standards, including those from financial institutions around the globe.
These changes have positive implications for supporting robust and meaningful SIA processes, social management plan development, and opportunities to enhance a project’s contribution to sustainability. However, implementing new SIA requirements under new impact legislation such as Canada’s Bill C-69, can be challenging, requiring new ways of thinking about projects for project proponents.
It is important to identify individuals, vulnerable groups, and communities directly and indirectly affected by the project, determine specific social impacts and benefit opportunities they may experience, and gather views on how a project could contribute to impact equity and sustainability.
Early engagement also helps identify culturally appropriate and agreed upon assessment indicators and methods for the SIA and determines how these communities want to engage in the assessment process. Communities with limited ability to participate in the impact assessment process require capacity funding and, in some instances, capacity development on the regulatory process.
SIAs need to be participatory at a minimum, and can be community-led, depending on the interests and capacities of communities. In Canada, some Indigenous communities have identified the importance of conducting their own SIAs within the regulated impact assessment process. In addition to contributing to the statutory impact assessment process, community-led SIAs can generate relevant information to assist Indigenous groups and proponents in the impact benefit agreement processes, particularly where mitigation may require compensation.
This typically requires co-development of the “social” aspects of the IA terms of reference by proponents, regulators and Indigenous communities, and formal agreements between proponents, communities and regulators on how results of community-led SIAs can be integrated and considered within the project Environmental Impact Statement.
For larger, long-term projects, the concept of sustainability is linked to requirements for formalized community investment agreements as a project condition. Successful agreements consider investments to sustainably support public goods and services impacted by the project such as investment into water infrastructure, along with fund-generating mechanisms to support infrastructure upkeep, and capacity development to support its management.
They also consider benefit enhancement opportunities such as skills and capacity development to support uptake of higher-level occupations, local business capacity and growth, and transferability of skills and business opportunities across industries.
The use of new technologies, such as cloud-based systems, can make sure that documents related to project consultation are available to concerned parties for greater transparency. Computer-based models can accept data on the financial, environmental and social impacts of a project, and then determine which combination of project attributes will result in the best outcome.
Environmental assessment legislation in Canada and globally has generally been limited in directing the assessment and management of social, economic and health impacts of projects. Emerging legislation, such as Bill C-69, illustrates how such legislation is changing to advance this understanding and help projects reach their potential as sustainable development opportunities for local communities.
Roxanne Scott is a Senior Socio-Economic Specialist with Golder Associates Ltd. This article appears in ES&E Magazine’s December 2019 issue.