Catching the right people

10th February 2014


Stakeholders

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  • Management ,
  • Employee engagement ,
  • Corporate governance ,
  • Stakeholder engagement ,
  • EMS

Author

Heather Bates

Chris Reynolds explains how environment professionals can best identify and engage stakeholders

Stakeholder engagement is used by organisations for a variety of purposes, such as product development, reactive issue resolution, proactive issue avoidance or simply to demonstrate that they are listening. Some organisations might also use it as a way to influence others and as a complex form of outward communication – though there is an expectation in stakeholder engagement that a two-way communication process takes place. As environment professionals, we can expect to become involved in stakeholder engagement as a part of our day-to-day work.

The complex mix of drivers, risks and stakeholder groups means that there are significant potential pitfalls, and this can cause organisations to shy away from stakeholder engagement. A poorly planned and executed programme can lead to negative publicity and is counterproductive. It is, therefore, worth getting it right and identifying stakeholders carefully.

Trailblazing organisations – frequently those associated with quality products and procedures – are likely to have embedded the stakeholder engagement process in their business activities. In such organisations, stakeholder engagement is often seen as a continual programme of communication with regular reviews of who stakeholders are, rather than a one-off exercise. Firms that successfully engage their stakeholders usually enjoy an improved image, more trust and a faster route to issue resolution when their business develops in a new way. They typically benefit from better stakeholder relations all round. These organisations are also more likely to base some or all of the elements of stakeholder engagement on an open invitation to “come and talk” and a wider range of involvement, rather than needing to proactively seek stakeholders out.

Why it’s good to talk

As in many areas of life, those organisations that are most successful at stakeholder engagement do not need to advertise the fact. Those that have embedded a continuous process of engagement will be open to new stakeholders who need only to announce their arrival. Many high-profile technology companies adopt this approach. It allows them to obtain continuous feedback on product design, customer needs and wants, production processes and risks. For instance, some of the biggest names in IT pay “friendly” hackers for any product exploitation they uncover, and they will develop products using targeted stakeholder groups. Such an approach can be invaluable for product and service development. Some stakeholders can be the source of the best quality consultancy advice possible, and for free, but only if the process is adequately resourced and given sufficient weight and influence in business development processes. Organisations also need to learn how to listen to them.

In short, companies that continuously engage their stakeholders do so because they regard it as matter of strategic importance. Those firms that do not consider stakeholder engagement to be part of their day-to-day activities will tend to deal with it on an issue-by-issue basis and delegate the task to staff working on the particular topic. At this point, it is often too late for effective stakeholder engagement.

The companies that employ a rolling programme of stakeholder dialogue are often those that also adopt a very challenging continuous improvement programme in their processes and procedures.

Open process

Some bold organisations, or those with statutory obligations to consult, often focus their efforts on open engagement with their stakeholders rather than spending a lot of effort on first identifying them. When the chemical company Solutia installed wind turbines, often a controversial step in communities, at its site in Newport, its stakeholder engagement was considered particularly successful. This success was due to the time they put in hand-delivering information to all residents who might be affected by the turbines, along with an open invitation to ask any questions. The effort put into door knocking was rewarded with locals’ cooperation over the turbine planning approval and installation, and the maintenance of good community relations.

A similar example of open stakeholder engagement, but on a larger scale, is taking place in Guildford. Like many local authorities, Guildford Borough Council (GBC) is currently developing its local plan. This document will set the scene for development in the area for the next decade or so, and is a requirement by the government if the council is to have any real control over the construction that takes place in the borough. This is a significant exercise generating lots of local interest and for stakeholders it presents a one-off opportunity to have input into the process.

To ensure that all stakeholders, including groups who do not routinely engage with the council, have the opportunity to share their input, GBC has developed an open process. This includes consultation and workshop activities in the town and rural communities around the borough, and a “local plan shop” in the centre of Guildford, which is open seven days a week. These physical mechanisms are supplemented by a website.

Despite the open and receptive nature of the consultation, GBC has still undertaken an exercise to identify specific stakeholder groups. One of the challenges, given the nature of consultation, is that vocal stakeholders tend to be much more effective at inputting their views, often to the detriment of other groups. The council has an obligation to seek and consider the views of all stakeholder groups, so various exercises have taken place to identify groups, such as the elderly, traveller communities and ethnic communities, and engage them in the most appropriate ways. The hard-to-reach groups have been targeted in particular to provide proper balance in the engagement exercise.

There is also an intergenerational aspect to local plan development, as future generations will be impacted as heavily as current generations – for example, in respect of affordable housing – so parents of young children have become a useful proxy for what might be considered an “impossible-to-reach” stakeholder group.

Identifying characteristics

So, what is the best way to identify stakeholders and how should you select those with which you want to have dialogue? Whether you wish to be selective will largely depend on what you’re seeking from the dialogue, and whether there is any sensitivity in the subject you’re engaging on. One technique that can be used to identify the most important stakeholders – and these might vary from project to project – is to develop a stakeholder matrix (see below). Stakeholder groups can be plotted on the matrix based on the two criteria of “importance to the project” and “impact the project will have on them”. Communications can then be tailored to each group accordingly.

Stakeholders appearing in the top right cell will often take less convincing and, when properly informed, they can be mobilised to help bring other stakeholders along. Meanwhile, it may require more effort to understand and deal with the concerns of those placed in the top left cell. This is why some organisations invest heavily in trying to contact hard-to-reach groups.

Instead of adopting a very open stakeholder engagement programme, organisations may choose to focus their dialogue on influencing key stakeholders, for example, rather than just engaging them. The main factors to take into account when selecting stakeholders with whom to engage include:

  • their willingness to engage with you;
  • the scope and level of their influence; and
  • their receptiveness to your messages.

Trade associations will sometimes take on the role of stakeholder engagement on behalf of members. One such example involved several trade bodies representing a new range of products collaborating on stakeholder engagement. The forum was seeking constructive dialogue on products that had significant scope for future benefits for society but also carried perceived risks in the manufacturing, use or disposal phases of their lifecycle. Here the stakeholder engagement was highly focused, and it was clearly in the interests of the manufacturers for it to be objective.

The selection of the most suitable non-governmental organisations (NGOs) for initial engagement was made using a graph, with NGOs likely to be positive to the products placed on the X axis, and those likely to influence the general public, for example, placed on the Y axis. This is a variation of the example stakeholder matrix above, but with both axes simply measuring the degree of positivity or negativity. The result was a graph where the top right quadrant showed the stakeholders offering the best chance of early engagement.

No rules

There are no hard and fast rules for stakeholder engagement – there are too many variables, but the job of environment professionals is to decide on the best course of action based on the sensitivities of the organisation, the stakeholders and the purpose of the engagement. One thing is sure, however. If conducted well, stakeholder engagement should improve stakeholders’ trust and enhance an organisation’s reputation. It should also pave the way for improved future engagement, which will be conducted from a position of enhanced trust.


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