Stakeholder engagement, it is “has been”?
If there is one notion that sustainable development and social responsibility succeeded to impose these last 15 years it’s the one about “stakeholders engagement”. Supposed evolution to shareholder, the neologism is a big tote in which stakeholders are seen as interested, impacted, linked and gravitating around the organisation. They get rights, attention, issues, and are closely listened to in order to reinforce and validate sustainability-related choices.
But who are they, really? Do they really have a voice? And do they want it, anyway?
Long before sustainability gave them a golden seat, the “classical” categories weighed already quite heavily in the strategic choices of companies: clients as a source of revenue, employees to continue the business, unions – often imposed by law- to defend employees, suppliers as key actors in the value chain, media to manage reputational risk, and NGO’s (often for the same reasons as media).
So where is the difference? The topic of the dialogue? Yes. Maybe.
All sustainability standards and doctrines urge, in theory, to not only identify and map these longtime partners and their expectations, but also to engage in a systematic dialogue with them. One-way information of stakeholders is not enough anymore. Now it’s their turn to inform us. They are invited to express their issues and perceptions so we can take them into account, respond with more accuracy, adapt our choices and maybe even our products and business models. What an ambition.
Engagement, is it a masquerade? The fact remains that even if these meetings, surveys, group focus,… are very instructive, they hardly change the facet of the organisation, let alone the impact the organisation eventually causes to the external world. There are many reasons for that, as many biases of the stakeholder paradigm.
First, the guest list: in practice, there are many ways to engage with your stakeholders. Each technique (focus group, round table, multi-stakeholder panel, poll, survey…) allows for more or less qualitative or quantitative data. They are rarely a sociologically accepted sample, representative of all the interests of “the impacted Society”. But that’s OK, let’s go for quality. What is harder is the composition of the group. To have an impact, the people consulted should at the same time know the organisation a bit, know about corporate responsibility and sustainability to understand the purpose of the discussion, know how to tackle tricky issues, be cooperative and constructive.. be available, competent, consultants actually. The dream team. Where are they?
This brings us to the second obstacle: the stakeholder fatigue. Admitting that you have your dream team, what ensures that they are willing to come? To clean up their agenda, prepare the meeting, read what you will send them in advance, collaborate for free – or a bottle of wine, … In practice, the first few dialogues are fresh and curiosity brings the people around the table. The invitation sounds like new, different, exciting even. Then, reality takes over. Some don’t come. The “best people”, the most interesting ones, the VIP, are busy. Or they have been solicited so many times that they don’t want to be bothered another time. We hear some say “we are their “one-size-fits-all” NGO… But would they themselves come if we invited them to our NGO stakeholder meeting?”. Good point, what if it was, again, a one-way effort that companies expect from their stakeholders but would not be willing to reciprocate?
Thirdly, the output: there is always a tension between the process and the outcomes. The credibility of a sustainability policy lies in the delicate balance between consulting and listening upfront to those impacted – input legitimacy-, and actually delivering a positive change, impacting Society – output legitimacy. At the output phase, it means having the courage to implement suggestions of stakeholders that will bring a sustainable change, and to refuse potentially harming demands of sometimes very influential or powerful stakeholders… who don’t run for sustainability, but for their own agenda.
Finally, the coup de grâce: After consultation and engagement, the last word belongs to the board of directors, master on board. Ideas, improvements, drastic suggestions have to pass through the Caudine Forks of budget, priority, habits, .. and shareholders! The result of that filter can be scanty. Do you still dare claiming that it is the result of stakeholders engagement? That would be an easy alibi. Go then motivate your stakeholders to come next time!
All in all, they must have been naïve or idealistic, those who wrote in the standards that stakeholders engagement was the golden way – or the unavoidable step to produce an impactful corporate responsibility programme. Some would rather be tempted by an enlightened CEO to move further, faster.
So what should we do? Be pragmatic. Yes, stakeholders consultations have an added-value. The simple fact to meet with external parties feeds the thoughts of CSR managers and CEO’s, brings new ideas, raises new attention points, mitigates risks. And that is rich and worth it. But we should not sell it as the only way to gain legitimacy. It is common sense to manage a business with due attention for the receiving environment. Only some managers have forgotten to do it, or refuse to see the reality in face. Like often, social responsibility brings back to the agenda sound business practices, in a world that has thought for too long that it could do without…