DEVELOPMENT WITHOUT CONFLICT

The report presents a business case for Free, Prior, and Informed Consent (FPIC), arguing that failing to secure community approval creates significant financial, operational, and reputational risks. Through four case studies in the Philippines, Argentina, Thailand, and Peru, it demonstrates that while FPIC requires an iterative process of information sharing and negotiation, the costs are minimal compared to the potential losses from project delays, asset write-downs, and lost revenues. The authors recommend that project sponsors, financiers, and host governments integrate FPIC into their decision-making and permitting processes to avoid costly conflicts.

• Securing community consent can lead to significant financial savings by avoiding construction delays and contractual penalties. In the Malampaya project in the Philippines, the cost of gaining consent was approximately $6 million (0.13% of total project costs), while the avoided costs from completing the project ahead of schedule were estimated between $50 million and $72 million.
• Failure to obtain community consent can result in massive asset write-downs and the total loss of projected revenues. Meridian Gold was forced to write down the value of its Esquel Gold Project in Argentina by US $379 million in February 2006 after a public referendum rejected the mine, potentially losing access to reserves estimated at US $1.33 billion.
• Community opposition can render a project economically unviable, even for public-sector initiatives. The Samut Prakarn Wastewater Management Project in Thailand, 95% complete but suspended due to community conflict and corruption, has seen its economic benefits reduced by approximately $1.27 billion, making it no longer viable under original assumptions.
• Community consent is a life-cycle issue; initial approval does not guarantee permanent immunity from opposition. The Minera Yanacocha project in Peru experienced early support that eroded over time due to environmental accidents and perceived corporate arrogance, eventually leading to the indefinite delay of the Cerro Quilish expansion, which held reserves worth an estimated US $2.23 billion.
• Mere consultation is often insufficient to mitigate risk because it does not transfer decision-making authority to the affected community. FPIC differs from consultation by allowing communities to meaningfully participate in decision-making and withhold consent if their needs and concerns are not addressed.
• The risks of failing to achieve community consent extend beyond the project sponsor to include shareholders, financiers, and host governments. These stakeholders may face reduced stock valuations, loss of tax revenues, or the failure of limited-recourse financing repayments.
• Public involvement in project oversight can serve as a critical mechanism for exposing corruption. In the Samut Prakarn case, it was community members, rather than government or ADB officials, who uncovered corruption in land transactions.
• The report proposes six core principles for implementing FPIC: providing sufficient information in local languages, ensuring inclusiveness of all affected members, maintaining formalized dialogue throughout the project life, securing legal recognition through binding agreements, establishing independent monitoring and grievance processes, and ensuring corporate buy-in by treating FPIC as a necessary development cost.

APA

HERZ, S., LA VINA, A., & SOHN, J. (2007). DEVELOPMENT WITHOUT CONFLICT. World Resources Institute. https://wriorg.s3.amazonaws.com/s3fs-public/uploads/development_without_conflict_fpic.pdf

Chicago

HERZ, STEVEN, ANTONIO LA VINA, and JONATHAN SOHN. DEVELOPMENT WITHOUT CONFLICT. World Resources Institute, 2007. https://wriorg.s3.amazonaws.com/s3fs-public/uploads/development_without_conflict_fpic.pdf.

Wikipedia

{{cite report |last1=HERZ |first1=STEVEN |last2=LA VINA |first2=ANTONIO |last3=SOHN |first3=JONATHAN |title=DEVELOPMENT WITHOUT CONFLICT |publisher=World Resources Institute |date=May 2007 |url=https://wriorg.s3.amazonaws.com/s3fs-public/uploads/development_without_conflict_fpic.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{herz2007development, author = {HERZ, STEVEN and LA VINA, ANTONIO and SOHN, JONATHAN}, title = {{DEVELOPMENT WITHOUT CONFLICT}}, institution = {World Resources Institute}, year = {2007}, month = may, url = {https://wriorg.s3.amazonaws.com/s3fs-public/uploads/development_without_conflict_fpic.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }