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Lecture Five: Stakeholder Engagement: Theory, Mapping, &
ManagersFebruary 11th 2015
Lecturer: Tobias WebbTobiaswebb.blogspot.com
Stakeholder EngagementOther lectures covered employees, investors and NGOs. This lecture looks at other key stakeholders:
• Ed Freeman on Stakeholder Theory (video) • Mapping Stakeholders• Engaging Middle Managers (Stakeholders?)• How to get the CEO / Board on board
A good example of a company getting stakeholder engagement wrong: Tesco
• Suppliers
• Communities
• Financial stakeholders
Stakeholder Mapping
How to make it work for your business
Who are your stakeholders? It's not so simple..
A stakeholder in an organisation is... “any group or individual who can affect or is affected by the achievement of the organisation’s objectives”.
(European Business Ethics Network)
"A stakeholder is any person or organization affected by or with the power to influence a company's decisions and actions" (Blowfield and Murray, “Corporate Responsibility”)
Stakeholders are evolving…
From a business perspective, we've gone from:
"A stakeholder is anyone that can screw up my business" (2002)
to:
"Stakeholders are source of innovation and risk management for my company" (2013)
But most companies still live within the first paradigm of risk management...
Stakeholders, the “obvious” ones
Primary:
• Employees
• Business partners & suppliers
• Investors
• The government
• Consumers
• Communities
Secondary:
• NGOs (but very important)
• Institutions
• Lobby groups
• Academics and business schools
• The media
• Non-human stakeholders: Natural environment/climate change
So where to start? The most significant groups..
• Suppliers (child labour)
• Communities (pollution)
• NGOs (Greenpeace etc)
• Governments (Compliance)
• Employees (Innovation)
Stakeholder Mapping: A simple four step plan
Step one: Develop a categorised list of the members of the stakeholder community
Step two: When a list is relatively complete (not perfect: it's a moving target) assign priorities based on:
Stakeholder Mapping - Priorities
Power (high, medium, low)
Support (positive, neutral, negative)
Legitimacy/Influence (high or low)
Urgency (strong, medium, weak)
Stakeholder Mapping: A simple four step plan
Step three: Focus on the ‘right stakeholders’ who are currently important
Create a tool to visualise this critical sub-set of the total community
Stakeholder Mapping: A simple four step plan
Step four: Benchmark this against Freeman's model of primary and secondary stakeholder to check relevance
Primary stakeholders: Those withoutwhose participation a company cannot survive
Secondary stakeholders: Those that influence the company or are affected by it but who are not essential to survival
How do you justify this kind of work to your board?
Stakeholder analysis helps identification of the following:
• Stakeholders' interests
• Their mechanisms to influence other stakeholders
• Potential risks: Which groups may be affected by our work?
• Potential opportunities: Who can help us solve problems?
• Key people to be informed about the project during execution phase
• Negative stakeholders as well as their adverse effects on the project
Embedding CR
Lessons from management
When embedding, things to think about (1)
• Objectives, goals, targets, milestones: What is the difference for you and your company?
• How could you ensure your lower-level targets service your higher level objectives?
• Build your own: Would you prefer to use external tools or frameworks to define goals and targets, or create your own?
• The long-and short-term: What would help you in matching targets and timelines appropriately?
When embedding, things to think about (2)
• Benchmarking: Are you aware of what others do, and how can you know what makes a good target in your case?
• What role is there for ongoingperformance comparisons?
• Going off-piste: How can you prepare for when results are not as planned?
• What about when the targets (or even the objectives) seem mistaken?
Embedding CR: Six Phases
Phase 1: INSIGHT - stakeholder views, science based understanding of issues, benchmark of competitors and peers
Phase 2: Public commitment of the “headline goal” – reducing carbon by 30%, reducing injuries
Embedding CSR: Six Phases
Phase 3: Establish a baseline
Phase 4: Allocating responsibility for action, the business must own the baseline, own the target and own the achievement
Embedding CSR: Six Phases
Phase 5: Public reporting of progress. Revisit what you said you’d do, create the sense of continuity and recommitment
Phase 6: Transparently revisit and challenge the original goal
Key lessons for senior managers
• Clarify CR roles and responsibilities at board level, CR champion on the board, board-level committee
• Articulate CR strategy clearly, reflecting board responsibilities and accountabilities. Put it in the mission!
Key lessons for senior managers
• Encourage frank exchange and engagement at senior levels
• Avoid delegation of critical decision-making that senior leaders need to make
Key lessons for senior managers
• Join-up high-level communications, linking to the company’s CR goals, objectives and strategy
• Champions and cheerleaders are critical: Don’t “outsource” responsibility for CR issues: Manage internally
Key lessons for senior managers
The key lesson is:
Don’t try to eat the elephant all at once: A bite at a time. Your road map is an invaluable tool
Ten fundamental
things to remember in
stakeholder engagement in
emerging markets
Tobias Webb, Founder, Innovation Forum
www.innovation-forum.co.uk
Tobiaswebb.blogspot.com
There are no secrets.
Resist the urge to compartmentalize information.Treat all communications as if they were goingto be posted on the internet for all to see(because, that may just happen). Act authentically but remember everything can and often will, endup on the record.
Interest alignment.
Constantly search for alignment between
company/project interests and stakeholder
interests. Be creative – sometimes real
opportunities lie outside the box. Interest
intersections, where your interests and
stakeholder interests align are valuable gems.
Think inside and outside the box to find them.
Realistic timeframes and budgets forstakeholder engagement are vital.
Make sure your CFO understands and approves a
realistic budget. Help them to understand the cost
of your failure.
Share credit – it will multiply
Credit shared is goodwill created. Acknowledge,
recognize, praise and promote partners and
collaborators (government, NGOs, communities,
organizations, etc). Do it every chance you can.
You gain much and lose nothing.
Smile. Let your humilityand humanity show.
Credit shared is goodwill created. Acknowledge,
recognize, praise and promote partners and
collaborators (government, NGOs, communities,
organizations, etc). Do it every chance you can.
You gain much and lose nothing.
Understand before understood.
Communication is critical. Listening is key. Seek to
understand before you try to be understood. Think
about how you say things: Use soft language, not hard,
emotion generating terms.
Everyone is the face of the company.
They should be trained in stakeholder engagement.
Right person to right position: If you delegate, train and
build capacity. Make sure your people know how do it
right, never assume. This means your bosses, your
reports and others across the company.
Simplicity is good.
Complexity will cost you.
Simple guidelines beat complex prescriptive
procedures every day of the week. Be realistic. If your
stakeholder engagement plan, process, procedure
is too complex who is going to follow it. Don't turn
stakeholder engagement into box ticking! Train and
trust your people. Give them room to be creative and
responsive but let them now where the boundaries are.
All is not the same.
The importance of taking note of culture cannot
be underestimated. Things change from country
to country and project to project. Rigidity will often
crack and break. Allow room for adaptation to culture
and use it when necessary.
Stay in touch.
Ongoing communications even when there is no
obvious demand – Be open and transparent, it builds
trust. Think about being counter intuitive with regular
communications about the good and bad. Get the
balance right. Communicate frequently enough that
you are not forgotten but not so frequently that you
are ignored. Don’t always wait for a big win, or failure.
17 further lessons from a recent executive workshop can be found at:
http://tobiaswebb.blogspot.co.uk/2014/11/
27-expert-tips-on-engaging-stakeholders.html
A few examples:
SAB Miller in Ghana (more here)
• Developed new beer brand brewed using cassava roots
sourced from small holder farmers in S Ghana
• Considerable engagement with farmers, farming communities,
agricultural organisations & regional Ministry of Agriculture
personnel to understand the cassava industry and develop a
local supply chain
• Addressed supply security concerns and built trust
• Beer brand then sold back into these rural communities
A few examples:
Anglo American nickel mine in Venezuela
• Created significant community housing programme
• Provided healthcare, medical supplies for local hospitals,
which lacked capacity and supply
• Matched and exceeded local expectations
• Flood and practical disaster assistance for communities
• Resulted in ‘Chavistas’ protesting FOR the company
A few examples:
Nestle and Golden Agri Resources (GAR)
• 2010 Greenpeace campaign shocked Nestle to action
• GAR, leading palm oil suppliers, pushed to work with
Greenpeace and TFT (The Forest Trust)
• Created market leading partnership to prevent deforestation.
Set the scene for huge changes in the sector and in forestry
(APP, Wilmar, many others)
• Win-win outcomes created for all involved, including investors