Why 'societal licence' is a more vital investment theme than ever

Traditional analysis underestimates biggest risks facing companies

What do Facebook, BHP, and Starbucks have in common? Or, put another way, what risk is most likely to drive change in each business?

Traditional investment analysis tends to underestimate the risks faced by companies today. From evolving consumer values, environmental issues, social media, and technology disruption, today's operating environment contains new risks that threaten the long-term status quo. Underpinning all of these risks, at the most fundamental level, is a firm or industry's relationship with society. Every firm has a 'societal licence to operate' or, put more simply, the permission that society gives to any corporate organisation to conduct its activities.  While invisible for most of the time...