Other countries have struggled to emulate the successful licence to occupy (LTO) model of New Zealand’s retirement village industry. In some cases, overseas retirement village industry organisations are left wondering how we have had success establishing a system that is viewed suspiciously by consumers in their own countries.

Indeed, New Zealand’s retirement village industry is mature, and prospective residents are generally well versed in how villages operate before they even set foot in one.

But this acceptance can be attributed to more than just time. Retirement Villages Association (RVA) executive director John Collyns believes it is its social licence that allows the industry to be so well accepted by the public.

At a recent Leaders’ Summit in Sydney, Collyns talked about the importance of “social licence” for New Zealand’s retirement village industry.

According to the New Zealand Sustainable Business Council, social licence can be broadly described as the ability of an organisation or industry to carry on its business because of the confidence society has that it will behave in a legitimate, accountable and socially and environmentally acceptable way.

It does not just derive from a need for legal or regulatory compliance but takes into account the inputs from a wider group of stakeholders and a sense of transparency and accountability in its external reporting.

In New Zealand, social licence is often associated with industries that have an environmental impact, like farming, fishing, transport and tourism.

However, the retirement village industry also operates under a degree of social licence. Collyns believes this is due to a number of factors.

For starters, village operators are building quality homes that meet people’s wants and needs.

The industry has also demonstrated that while it is happy to engage with Government and public policy, it can effectively self-manage.

The industry is keen to remain free from Government intervention, and as such must maintain a high level of credibility with government officials. For instance, there is no government agency to audit retirement village compliance, so the RVA takes it upon itself to ensure its members are compliant with the relevant legislation.

Following the Canterbury earthquakes, the RVA led a number of amendments to the Code of Practice that allowed no-fault exit situations in retirement villages, such as occurred as a result of the earthquakes.

Arguably the biggest indicator of social licence is the way the industry engages with its stakeholders and residents. Collyns says the RVA strives to pay attention to the needs and expectations of stakeholders, especially resident advocacy organisations.

For example, active engagement with resident associations can allow an operator to react quickly to concerns and issues in a way that’s not only fair and reasonable to the residents but also align with the operator’s values.

The RVA has consciously built this into its strategic plan, by striving to develop a sustainable and responsible retirement village industry for the benefit of residents. One of its key objectives, alongside representing the interests of village owners and operators, is to promote a quality environment for retirement village residents.

That isn’t to say it is the finished product. The industry and its relationship with stakeholders, particularly residents, is still a work in progress.

Complaints procedures and adjustments to contract clauses will continue to be tweaked in reaction to individual cases. And common ground won’t always be found. The recent discussion around the timing of capital repayment upon the termination of an occupational right agreement (ORA) is a case in point. However, as long as the industry continues to listen and respond, and to operate in a transparent and regulatory way, it will continue to build its social licence.


Please enter your comment!
Please enter your name here