- February 26, 2019
- Posted by: Rutendo Mafemba
What is a stakeholder?
A stakeholder is a person or group that affects or is affecting, influencing or is being influenced by the activities of an organization.
What is stakeholder engagement?
According to Accountability (2015), stakeholder engagement is defined as “the process used by an organisation to engage relevant stakeholders for a clear purpose to achieve agreed outcomes”.
Alternatively it is also defined by the activities and processes undertaken by the organization to interact with the people or groups that affect or are affecting, influencing or are influenced by the activities conducted by the organization. The team that may be responsible for or are involved in engaging with stakeholders include those that manage corporate affairs, engagements, relations, CSR, Sustainability, brand reputation and building strategic stakeholder capital and shared values.
At the core of engaging stakeholders should be a well-defined, comprehensive and measurable corporate stakeholder engagement policy which identifies the influencers/ affecters and the corresponding modes of engagement in an organized and detailed manner. Having a policy demonstrates a commitment by an organization to valuing the collaboration between their stakeholders and their business and acknowledgement that their operations are affected and influenced by the stakeholder’s existence.
What are the benefits of Stakeholder engagement?
The Stakeholder engagement process by an organization poses many advantages:
1. Builds Social capital
By building strong relationships with stakeholders provides benefits such as greater access to primary information, improved influence and support rather than scrutiny in the event that problems arise. Reviews, enquiries, meetings, consultations, surveys and feedback forms are great sources of an organizations brand reputation, product perception and business impacts on society, the environment and economy.
2. Builds competitive advantage from stakeholder trust
Stakeholder engagement creates strategic value for the organization through the pooling of resources such as knowledge, people, money and technology towards achieving the triple bottom line i.e People, Profit and Planet. A stakeholder engagement strategy / policy is a must have for any business that is in operation.
3. Risk management
An active relationship with stakeholders through ongoing/continuous engagement allows an organization to anticipate any potential problems or issues that may both positively and negatively affect the business. Timely identification of issues can be mitigated before they become major problems that can be damaging to the overall reputation of the business. Identifying material issues of the business from the feedback from stakeholders, gaps can be identified and closed in a strategic manner before becoming problems to the organization.
4. Encourages innovation to meet stakeholder expectations
Sustainable business practices are increasingly in demand by various stakeholders including investors and being connected to your stakeholders potentially opens the business up to new opportunities. New opportunities arise from transparency and improved flow of information across and along communication lines. Companies that have implemented a solid stakeholder engagement policy have positioned themselves well as thought leaders with high influence in the industry.
5. Trendsetting and Market leadership
For companies in Zimbabwe that have and are planning on implementing Sustainability and/or integrated reporting, Stakeholder engagement becomes a requirement as part of the organizations disclosures. Information relating to how:
- material risks and opportunities are identified
- inputs for organisational priorities and activities are obtained
- feedback on progress towards a more sustainable future for the business is provided
How can an organization/Programme/Project make stakeholder engagement part of their overall strategy?
Should one be interested in making Stakeholder Engagement part of the overall Corporate Strategy , INŚAF provides stakeholder engagement related expertise through:
- Stakeholder engagement Strategy: In-house training and workshops
- Materiality Assessments
- Stakeholder outreach and engagement
- Stakeholder policy development
- Stakeholder engagement KPI development
For more information about Stakeholder engagement, please feel free to contact us.