Six
best practices in stakeholder engagement
A CSR Thoughtpiece from the CSR Training Institute
-by Wayne Dunn
I recently wrote
a piece on five mistakes companies make in stakeholder engagement and many of you asked me
to give a list of best practices. Here
are six.
This list, like
the last one, comes from a couple decades of rubber meets the road experience (remember, experience mostly comes
from making mistakes or great mentors, or, like mine, both)
Honesty, Trust & Integrity
This is the
critical principle and if you don’t get that one right the rest won’t
matter. You may have some short term
results but I’m going to be shorting your stock because it’ll blow up sooner or
later. And, if it doesn’t, it should.
In no particular
order here are 6 best practices in stakeholder engagement.
Remember, you are engaging with the stakeholders because you believe
it is in your interest and that it will help you to create value. Guess what?
They are engaging with you for the same reason.
Maybe they value a pollution free world or a reduced carbon world or
a child labour free supply chain, or maybe it is better schools or hospitals or
something else.
Don’t judge what stakeholders value and what their interests
are. Accept it and, as much as possible,
try to figure out how your business, your activity, your work might further
your stakeholders’ interests.
Be creative in discovering the value propositions that can align
your value and interests with those of your stakeholders.
And be transparent about what your value and interests are. You stakeholders have it figured out anyway!
2. It’s OK to
disagree – but, disagree without being
disagreeable. And stay curious
You will disagree with stakeholders, sometimes with most of
them. That doesn’t make them wrong, or
you wrong. And no need to be
disagreeable. Stay open, stay engaged,
and so important to stay curious.
One of the biggest, and possibly most unexpected, social license
wins that I’ve ever been part of happened because the geologist, who ‘got
stuck’ with community relations, stayed open, engaged and curious.
The opposition that had shut down the other mine didn’t want this
one to become the first modern producing mine in the country. They had won over some of the local
communities.
The engineer spent months, many months in the community. Getting to know the residents, including
those who were in vehement disagreement.
Trust developed. Transparency happened.
Shared interests emerged and were built on.
Not everyone agreed, but the mine got built. Disagreements remained, but people were not
disagreeable. And the company’s share
price went from 70 cents to over $20!!
And the local agricultural economy flourished.
Probably none of this would have happened without a patient,
engaged, curious and agreeable geologist.
Bonus for me on this example – my consultancy was providing advice and
support and we got to claim some credit for all the great work the geologist
did! :)
There seems to be an exponentially increasing list of standards,
norms and regulatory requirements for stakeholder engagement and all things CSR
[Corporate Social Responsibility].
They are important (some of them anyway) so you can’t ignore
them. But, don’t be consumed by
them. If you want stakeholder engagement
to add value to your operation and meet your stakeholder’s interests and needs
then mere compliance is just the foundation
Figure out what you want to be compliant with, and why. But resist the urge to embrace more and more
standards and norms, to check more and more boxes.
There is a comfort and certainty to compliance. There are boundaries and a sense of
completeness when you know you are compliant with yet another standard. It is auditable and defensible.
On the other hand, strategic stakeholder engagement is often
ambiguous, uncertain and sometimes even downright scary. There is no certainty of success.
Compliance focus / strategic focus.
It’s not one OR the other. It’s
BOTH.
|
How NOT to do it, but alas still a common approach!
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Spend time thinking about the blend and mixture that is right for
your business. Its and investment that
will pay dividends
4.
Share the credit, multiply the resources. Find
partners!
Actually, the foundation of this best practice was set out in #1 Think Value and Interests – and do it transparently. But it is so important that I decided it had
to be listed separately.
This mostly focuses on your initiatives and collaboration with
stakeholders, the ones focused on creating value and meeting interests for you
and the stakeholders.
If that initiative is successful who else or what else
benefits. Are there other people or
organizations that have objectives that would be furthered by success of your
collaboration with stakeholders. If so,
they could be potential partners and may well bring financial, organizational,
reputational and other resources to the table.
This all sounds a bit academic and theoretical. What does it really mean?
Say you are a consumer goods company operating in a frontier market
and want to increase your local supply chain because it will reduce your costs,
add unique marketing pitches to your product, and build reputational capital
and social licence.
Or you are a mining company operating in a remote community and want
to improve local educational capacity.
Your value and interest in this includes; better educational system
makes it easier to attract and retain employees, helps create a more qualified
and engage-able local labour force, helps expand local livelihood potential,
etc.
Or you are a petroleum company and want to enhance local skills
training capacity so you are able to recruit and advance more local workers.
In all of these the value and interests of local stakeholders are
self-evident. And there are many other
examples in health care, environment, agricultural development, etc.
The opportunity is in thinking about who or what else shares an
interest in this. Local economic,
social, educational and health issues are of interest to national governments,
international agencies, multi-laterals such as the United Nations, World Bank,
etc., NGOs, National Development Agencies such as USAID, DfID, DFATD, GIZ*,
etc.
They are also stakeholders in the success of your efforts.
Your company’s investment and support in these areas can help these
stakeholders to meet and further their objectives. And they can bring resources and expertise to
support your efforts. Note – the above
are all real world projects.
Spend time thinking about who else benefits if you succeed. Be creative.
Be strategic and remember – broad and inclusive value propositions can
create a lot of value for you and for stakeholders (this is a fundamental
tenant of Silicon Value entrepreneurship but that is another story…)
One of the great things about finding partners and sharing the
credit in stakeholder engagement and CSR is that it is seldom a zero sum
game. By sharing the credit you often
get more credit yourself, and more resources to contribute to success.
Communication strategies, methods and tactics will
vary from group to group and area to area.
It is more than just words and message.
It is about communicating so you are heard and in ways that connect to
the capacities, values and interests of the audience.
Beware of simply meeting narrow, regulatory
definitions of who are your stakeholders.
Think outside the box to identify other groups and
interests that would benefit from your success.
A good example of this is a real estate project that I
am advising. The project is situated in
an area of large, sprawling estates in a valley on a large island. It aims to create a ‘pocket neighbourhood’ of
smaller homes, more community and less environmental footprint.
Regulatory requirements for permitting mandate
consultation and engagement with local landowners/stakeholders. There is likely to be significant resistance
from this group as they would see a change from large, sprawling estates as
potentially reducing the value of their properties.
There are many other groups in the valley that are
advocating for and supportive of the development concept that is being
promoted. For the most part their
regulatory involvement would be minimal unless it was stimulated.
The developer is embarking on an education campaign to
help these other stakeholders better understand the specific type of
development he is promoting and to help them to better educate the broader
public on the Island and in the valley.
The developer is helping these people and groups to
meet their interests and objectives of softer environmental footprints and at
the same time he is engaging with a group of stakeholders that have an interest
in the success of his permitting and can be motivated to provide support at
public meetings and consultations. Hopefully avoiding the situation where the
only engaged group is local residents who are likely to oppose the development.
Don’t Forget Internal Stakeholders
You can use many
of the above best practices for internal stakeholder engagement, including
especially focusing on their interest and value.
What is critical
is that you and your company find ways to embed best practices like these AND
embed a process where you are constantly revisiting and driving this throughout
the organization, permeating the organization from top to bottom and across all
departments and divisions.
If stakeholder
engagement is not seen as everyone’s responsibility at some level you will
never achieve the success or value that is possible. Ghettoize it in some corner or department and
you will seldom get it right and often get it wrong, at a cost to you and to
your company.
Successfully
engage your internal stakeholders and you will have easier and more consistent
success with your external stakeholders.
*USAID, DfID,
DFATD, GIZ are official development agencies of USA, UK, Canada and
Germany. They are examples only. There are too many others to list them all.
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