The Social Licence as a Form of Regulation for Small and Medium Enterprises

Traditional forms of regulation have been criticized for not adequately protecting the environment. Indeed, there is evidence and growing support for the view that societal pressure can act as a social licence which induces ‘beyond compliance’ behaviour. In exploring this view, the paper (a) outlines the characteristics of the social licence; (b) assesses how these characteristics can influence the environmental behaviour of small and medium enterprises; (c) presents a model which shows that social licence pressures depend on the interplay of a range of factors; and (d) applies the model to explain why societal pressures rarely induce beyond compliance environmental behaviour among small and medium enterprises.