Materiality assessments are on the rise and we are seeing a trend for on-going stakeholder feedback and dialogue. Because of this we might be quick to congratulate ourselves for believing that we have our stakeholder ‘engagement’ all sewn up. But do we really?
Let’s start by taking a step back. Could any of us provide a clear definition of the word ‘engagement’ if asked on the spot?
In the Oxford dictionary you have to read through to the third description of engagement before you reach the definition used in the sustainability world. Ahead of that is talk of marriage and arrangements of dinner dates – all very nice but irrelevant to the world of sustainability. Or is it? Should we in-fact pay attention to those first two definitions and take something valuable from them?
Engagement implies a long-term relationship with active involvement. Do we regard the ‘engagement’ part of stakeholder engagement with enough gravity? Or do we say we have ‘engaged’ when really all we have done is have a conversation, or gleaned a onetime opinion. I’m sure if you delved into most companies’ engagement activities we might find that they are not really engaging their stakeholders at all.
So why do we even want to engage with stakeholders?
Companies conduct stakeholder engagement for a whole host of reasons that include:
- Working out what to focus efforts on – consulting stakeholders, for example during a materiality assessment, helps companies develop and validate key focus areas and/or material issues.
- Improving reporting – companies may engage with internal and external stakeholders to ensure they are transmitting the right messages.
- Improving risk management and compliance – many companies have complex supply chains. Only by engaging with stakeholders will they fully understand the risks and whether they are meeting compliance issues.
- Driving innovation – using different perspectives can help to get ahead of the game, taking the insights and creative ideas from those both within, and outside of, the business.
- Developing strategy – stakeholder engagement can be instrumental in developing strategies and achieving that all important buy-in.
- Increasing financial reward – engaging with stakeholders can be about more than just gathering opinion. It can be an invaluable way to ensure projects go ahead, are run smoothly and delivered efficiently. An example of this is shown in a piece of research conducted by Wharton, looking into the gold mining industry. It found that the value of the relationship with politicians and community members around the mine was worth twice as much as the value of the gold itself.
So, if we are in a world where just asking someone a question to complete a tick box exercise no longer counts as engagement, what does it take to truly engage?
Be specific – what do you want to learn from your stakeholders and who will have the best input? Have a key question you want to answer or a key aim you want to achieve through your engagement. Be clear on what you want from your stakeholders.
Be proactive – lead the conversations. Don’t wait until there is an absolute need to engage your stakeholders. By being proactive in your engagement you will remain one step ahead of your peers and competitors. You will be more likely to build greater respect from your stakeholders.
“Stakeholder engagement is a never-ending process. We have to continually earn stakeholders’ confidence. It’s a relationship” Wouter Vermeulen, Former Corporate Responsibility Director, Health and Wellbeing, Coca Cola Europe.
Offer a little something back – it is engagement after all! An organisation’s aim shouldn’t be just to gather as much information as possible from stakeholders and offer nothing in return. An incentive doesn’t have to be financially driven. In fact, if you are looking for long term engagement just promise to keep them in the loop and actually deliver on that. This can be in the form of an infographic or short report. The key is to keep them informed on what your company is doing, based on their input and what other stakeholders said. Make them feel valued.
Talk to them in the right way – tailor the channels you use to reach out to differing stakeholders. Not everyone engages with the same medium. It is important to get both reach and depth through different means. Social media, surveys, interviews, focus groups, reports – think about what you are asking from your stakeholders and then work out the best way to communicate that.
Keep in touch – Work out who really matters and keep the channels for dialogue open. Whether you are developing a new strategy or producing your annual sustainability report, it’s is not enough to ask them once. Keep them involved along the way and go back to them when it is time to review.
Stop to think about what engagement really means and go about it in the right way. By considering the points raised above, it will benefit your company through stronger relationships, being better informed, providing important direction and even – perhaps – increasing your bottom line.
