Every few years a new buzz-word concept springs up and becomes fashionable in business. A decade or so ago it was "corporate social responsibility" and, more recently, "sustainability". The most recent is the even more amorphous "social licence to operate."

The difficulty with these concepts is not that they are bad notions per se but that they add an extra layer of demands that companies are expected to comply with. This layer is over and above the rule of law.

However, "social licence to operate" is a different proposition from the previous two.

The new theory is broadly defined as the implied consent a company enjoys from the community to undertake its business. It tends to apply primarily to resource or fanning businesses: those perceived to alter or despoil the natural environment in some way or other.

Basically, the social licence is a way of asking: does this project continue to have community support? But there is the problem with this so called social licence.

You cannot apply for it, there are no fees to pay, no compliance conditions and no objective criteria on which you can base your claim. There is merely the fickle wind of public opinion or well-targeted activist campaigns.

The basic notion is that the "community" is somehow separate from and superior to the elected representatives in Parliament Not only will a company seeking to maintain its social - licence have to negotiate all the legal frameworks, and a maziof regulation, but it also has to appeal to a higher authority, "the community," which can withdraw the licence at any time.

Of course, "community" in this sense is often not what most people mean by community but rather the PR-savy activists, the politically opportunistic and the single-issue non-government organisations who are against any given activity.

Fortunately, the social licence concept is not yet in widespread use here but a quick glance across the Tasman reveals just how pernicious it has become.

A few years ago, an Australian TV production documented the live cattle trade. It found a couple of abattoirs in Indonesia that were slaughtering cattle in an inhumane manner - the film was provided by an animal rights group.

The subsequent animal rights and Facebook campaigns spooked the agriculture minister so much he suspended the trade without warning, announcing it had "lost its social licence".

The move decimated an industry that is still struggling to catch up since its resumption It didn't matter that this practice was happening in Indonesia, and not Australia, nor that the Australian authorities, once alerted, immediately took steps to ensure cattle didn't end up at the guilty couple of abattoirs.

A campaign by groups who didn't believe the live cattle trade should be legitimate managed to get the "social licence" revoked.

Another case was the Abel Tasman "super trawler," a massive fishing vessel that passed through all the legal hurdles to operate in Australia and had worked closely with fisheries officials to fulfil all its requirements before sailing for Australia.

Sniffing a political upside due to upset local fishermen, the environment minister scotched the vessel's fishing licence, citing the lack of social licence to operate.

In 2010, when arguing for a new super resource profits tax, many in Australia argued that higher taxation was important for the mining industry to maintain its social licence.

This isn't about the cattle trade, super trawlers or mining. It is about the fact that law-abiding businesses, making investment decisions in good faith, may find the rug pulled out from under them by social licence concerns - vague concerns that might be all but impossible to address.

It implies the rule of law is not enough and that a legal business or undertaking can be banned, suspended or rejected any time the prevailing political wind shifts. It is customary that stakeholders (who can be anyone) just make up the rules as they go along.

The above are concrete examples but the general woolliness of the concept is easy to see.

A visit to the site www.socialicence.com reveals the following "At the level of an individual project the social licence is rooted in the beliefs, perceptions and opinions held by the local population and other stakeholders about the project. It is therefore granted by the community.

It is also intangible, unless effort is made to measure these beliefs, opinions and perceptions.

Finally, it is dynamic and non-permanent because beliefs, opinions and perceptions are subject to change as new information is acquired. Hence the social licence has to be earned and then maintained."

This is a way for opponents of certain industries or projects to de-legitimise a business by going around and proclaiming that its social licence has been or should be withdrawn. And although the term sounds technical and legitimate, it is calling for a withdrawal of something that does not not exist by those who were powerless to give it.

Although is notion is clearly becoming fashionable, and some business leaders may see some PR advantages to it, they should resist its superficial appeal.

After all, New Zealand already has a "social licence to operate" and it is made up of laws passed by Parliament, consisting of elected representatives and the courts that enforce them. For anyone caring about the rule of law, the social licence is a concept that should be viewed with suspicion.