Businesses can find it scary to invite contrary opinions or criticism when they start having conversations with their stakeholders. But this is no reason not to be aware of perceptions of those outside an organisation. At the very least it can help companies be surer of their own arguments and at best build help businesses make better decisions about their future.
Stakeholder engagement is the current lingo for what is essentially the process and management of relationships between business and those with an interest or impact on it. Customers, employees, suppliers, NGOs etc…
Engagement with these groups gives businesses insight about what stakeholders perceptions and opinions are and what they want from business. Stakeholder engagement is therefore intimately intertwined with Corporate Responsibility (CR) – businesses striving to have a positive impact on stakeholders, society and the environment
There are numerous ways to categorise the different purposes and uses of engagement in Corporate Responsibility, below is one way of categorising that BITC feels most simplifies it is:
1. Conversations around Corporate Responsibility
Many businesses have benefited from using engagement to develop a more strategic approach to CR. Most organisations will encounter no shortage of CR issues that they could tackle, engagement can help focus down on those subjects that are most important for business and those they interact with. Management may already have an internal view of where time and effort should be spent, but it is equally important to know what stakeholders feel the key issues are – they may not be the same thing.
2. Embedding CR in the business
Corporate responsibility for many businesses is about getting people to do things and do things differently. People are much more likely to change what they do for something they feel an ownership of, or they’ve had a say in, therefore good engagement can make this job much easier. Early engagement can also help resolve problems up-front before investing time and effort in what might turn out to be an impractical solution. For example, a drug company is changing how they communicate information to time-poor medical staff after an engagement exercise revealed that most of their brochures were going straight in the bin.
3. Building trust, identifying risks and opportunities
Building trust or changing perceptions about a business is not something will happen overnight or through one conversation, it requires time and sustained effort, with businesses prepared to actively respond to stakeholder concerns. But the benefits of having good relationships with the right people and organisations can be far-reaching, helping identify what is going on around the corner so business can responding quickly and effectively to opportunities or risks. For example, a mining company was able to stop a false rumour before it reached the press because they were alerted by an NGO with whom they had a working relationship, saving them money, and protecting their reputation and brand.
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