Date post: | 23-Dec-2015 |
Category: |
Documents |
Upload: | andrea-gilbert |
View: | 221 times |
Download: | 0 times |
What is the Stakeholder Issue in Sustainable Development?
• Third largest PGM producer• 30 000 employees• Operations in located in RSA
Barnard MokwenaVice President: External AffairsLonmin Platinum
What is the Stakeholder Issue with the Mining Brand in South Africa?
Is this ISSUE an Opportunity
to do things differently?
Or is it a THREAT to the sustainability of operations
Why?
Social license to operate increasingly important
Introduction
Stakeholders. The most quoted definition is that given by Freeman (1984):
The challenge of the Industry Brand in South Africa
• Associated with a legacy of more than 100 years
• Epitomises exclusion, repression and exploitation
• Almost a replica and a symbol of the previous regime
“any group or individual who is affected by or can affect the achievement of an organisation’s objectives”
Creating Sustainable Value and Wealth
The Broad Post-1994Stakeholder Issue is characterised by Quest for socio-economic liberation,
And is driven by human rights culture, and memories of land ownership
Distinctive OrganisationalCompetencies
Eroding
Dynamic and Complex
Value?
CSR - Poverty
Social Justice and Equity
What strategic stakeholder management can achieve …
Robust relationships with stakeholders
High reserves of reputational capital
Contribution to sustainable business growth and sustainable development
Post-apartheid Robust Relationships
Characteristics of “healthy” relationships:
Control MutualityThe degree to which stakeholders and the company are satisfied with the level of control or
influence they have over the relationship.
The most stable, positive relationships exist when stakeholders experience that they have some degree of influence over the relationship.
Trust
The confidence that the company and its stakeholders have in each other and the willingness to open themselves to the other party.
Integrity - as the extent to which any party’s behaviour is perceived as fair, just, and honest.
Competence, which is the belief that an organisation has the ability to do what it says it will do.
Satisfaction
Why stakeholder relationships matter?
Stakeholder relations
Stakeholder engagement
Reputational CapitalSocial Reporting and Compliance
Corporate Governance
Organisational Performance
Information on the quality of stakeholder relations is part of measuring and reporting
social/ environmental impacts
Quality of relationships also informs risk management
and future regulatory requirements
Increasingly, corporate reputation is understood as
built through the organisation’s relationships
with all stakeholders
Relationships as a business asset and a management
competence. ’
The quality of relationships drives stakeholder engagement and
responsiveness, ensuring the needs and objectives of stakeholders are
taken into account
Reputational Capital
• What is reputational capital?
Market value
Book value
Intangible, separable
assets•Trademark•Patents•Know-how•Customer Relationships•Software•WIP•Order backlog
? Goodwill
• The market value of the company in excess of its book value and separable, intangible assets
• It constitutes the residual value of the company’s intangible assets over and above its stock of patents and know-how
• Much like knowledge capital, reputational capital is an aggregate intangible asset that must be evaluated using both internal and external information
Reputational capital
Reputational Capital
High reserves of reputational capital give an organisation distinct advantages:
GENERATE REPUTATIONAL GAINS– Their products/services and stock offerings entice more
customers and investors – and command higher prices– Their jobs lure more applicants – and generate more loyalty and
productivity from their employees– Their clout with suppliers is greater – and they pay lower prices
for purchases and have more stable revenues
MITIGATE THE RISK OF REPUTATIONAL LOSSES• Their risks of crisis are fewer – and when crisis do
occur, they survive with less financial loss
Step 4:
Stakeholder Engagement
Inclusive, integrated approach
Step 3:
Stakeholder Profiling
Emergent Strategy
Issues / Risk Management
Roadmap to Strategic Stakeholder Management
Step 2:
Stakeholder Listening
Environmental Scanning
Formal/informal listening
Stakeholder universe
“Main folders” for key strategic
stakeholders
Stakeholder insight
Know their stakes + issues
‘Names and faces’ orientation
“Sub folders” with detail information
Step 1:
Stakeholder Mapping
Deliberate Strategy as point of departure
Roadmap to Strategic Stakeholder Management – Step 1
• Identify stakeholders based on the organisation’s strategy
• Your stakeholders are those groups that can either hinder or facilitate the achievement of your strategic goals
• Prioritise stakeholders based on the organisation’s strategic intent (primary: secondary)
• Various techniques to map stakeholders
• The result will deviate from the generic stakeholder map
Stakeholder universe
“Main folders” for key strategic
stakeholders
Step 1:
Stakeholder Mapping
Deliberate Strategy as point of departure
Roadmap to Strategic Stakeholder Management – Step 2
• Why?• How? • What?• Lonmin example
Step 2:
Stakeholder Listening
Environmental Scanning
Formal/informal listening
Stakeholder insight
Know their stakes + issues
Stakeholder listening: How?
Two main categories of listening:• Environmental scanning (continuous)
– Mostly media & document analysis– Internal processes to deal with issues/risks should be formalised
• Formal measurement/research (pre-defined intervals)– Reliable & valid social research methods– Combine quantitative (describe with statistics) and qualitative
(understand the reasons why) methods– Adapt measurement instruments and tools to the needs of
specific stakeholder groups– Set targets & track progress – Two-way process: give feedback to stakeholders after
measurement
Stakeholder listening: What?
Focus of measurement depends on which stakeholder or stakeholder groups are being listened to
Generally, stakeholder listening can focus on:• Perceptions, needs, expectations, experiences• Relationship quality
– Broadly influenced by various indicators of communication and perceived behaviour or conduct towards stakeholders
• Reputation• Social impact or social performance (mostly communities)• Strategic alignment (mostly employees)• Identifying gaps• Describing specific aspects• Measuring or quantifying
Stakeholder listening: Example
• Community satisfaction survey– Quantifying perceptions in an index to plot performance– Focus group interviews– Personal interviews– Simultaneous translation where necessary– Compare ratings over time– Compare community ratings with staff/management
ratings on specific issues
Benchmark (example)
Communication
Behaviour
• Access• Issues addressed• Frequency
More…
• Health• HIV/Aids• Environment
More…
Benchmark (example)
Communication Indicators 1-7Access
Issues addressed
Frequency
Amount
Timeliness
Information flow / 2-way comm./ feedback
Style/symmetry/reciprocity
Complexity/clarity
Accuracy
Coordination/integration
Participatory approach
Credibility/Trustworthiness
Control mutuality
Mutual understanding
Benchmark (example)
Behavioural Indicators 1-7
Health
HIV/Aids
Environment
Housing
Involvement in the community
Commitment
Empowerment
Visible transformation
General visibility of management
Transparency
Coordination of projects
Control mutuality
Relationship behaviour
Corporate citizenship
Sustainable development
Total: Behaviour
Percentage (%)
Mean score
Company Performance (example)
Step 3:
Stakeholder Profiling
Emergent Strategy
Issues / Risk Management
Roadmap to Strategic Stakeholder Management – Step 3
‘Names and faces’ orientation
“Sub folders” with detail information
• Use the results of stakeholder listening to profile stakeholders
• Become specific• Use the issues detected in
stakeholder listening to inform emerging strategy
• Prioritise issues based on their potential impact on stakeholders
• The issue: stakeholder matrix
Step 4:
Stakeholder Engagement
Inclusive, integrated approach
Roadmap to Strategic Stakeholder Management – Step 4
• Develop a company-wide, coordinated approach towards stakeholder engagement
• Understand the company’s stakeholder interfaces and govern value-based interaction through clear stakeholder protocols– have measurable objectives per stakeholder interface– provide clarity on the roles and responsibilities of
different teams interacting with stakeholders • Develop a communication programme for each
stakeholder group: one size doesn’t fit all• Have a auditable system of stakeholder engagement (track
interaction, keep record of commitments made)• Identify, analyse, manage and track issues and the impact
of issues on stakeholder relationships• Engage stakeholders during crises
Inclusive, integrated approach to stakeholder engagement
Stakeholder engagement in the past
Current approach to stakeholder engagement
Project based Engagement basedMoney RelationshipsOne-way process Two-way processTeaching LearningWe vs. them Togetherness, trustActivism risk Risk managementPeripheral Core businessCompliance Competitiveness
2.1%
42.1%
1.0%
3.6%
6.4%
3.8%
4.9%
4.9%
7.5%
16.6%
7.0%
0.0% 10.0% 20.0% 30.0% 40.0% 50.0%
Western Cape
Eastern Cape
Northern Cape
Free State
Limpopo
Mpumalanga
Gauteng
Kwazulu-Natal
North West
Lesotho
Mosambique
N = 470
Cosmopolitan Population