Stakeholder dialogue – what is it?

Nov 19 2001 by Brian Amble Print This Article

Translating commitment to sustainable development into practical action and delivering to the bottom line? Tall order, holy grail, latest stock market fad or missed opportunity?

The key to unlocking the potential of sustainable development, is encapsulated in the jargon ‘stakeholder dialogue’. While currently the watchword of corporate social reporting, there is much confusion over what it really means. In Article 13’s experience, participation and dialogue can help a company to understand what society expects from it, underpinning its licence to operate.

By stakeholders we mean groups affected by a company’s actions, including employees, customers, communities, suppliers, NGOs and the environment. By dialogue we mean getting the people in those stakeholder groups, including representatives of the environment, together to identify the issues and measures relevant to them. It is this process that is known as stakeholder dialogue.

Before and beyond market research Although many of the techniques used in stakeholder dialogue come from market research the two should not be confused. Traditional research aims to understand reactions to concepts developed within the company, usually with a set of pre-determined questions. Dialogue at its most fundamental is a participatory approach that encapsulates both the technique used and the fact that the objective is to get people really talking to each other as individuals. It obviously implies two-way communication – both listening as well as talking, but, more importantly, it is about stepping back from implicit assumptions and functional positions.

With traditional research, managers start by identifying the issues they want to investigate. Dialogue is about asking what the questions should be. It goes beyond the way things get done in a company and what the company believes in to discover what matters to all the stakeholders and to get them involved in identifying the way things can be changed.

Delivery to the bottom line – making value tangible The delivery to the bottom line and to competitive advantage then becomes clear. At its most basic this approach can act as an ongoing scanning system for risks leading to quantifiable risk reduction. It reveals the linkages between all the elements of sustainable development including the economic factors enabling an organisation to build a practical blue print for a sustainable future.

At its best it can help organisations and their stakeholders to develop programmes that turn obligation into opportunity through making a potentially huge list of issues practical and relevant. The ultimate delivery to the bottom line is more than cost savings and risk reduction. It also comes through staff attraction, motivation, shared values, development of a listening culture and enhanced corporate reputation.

It has been said that the world has moved from a ‘trust me’ culture where stakeholders placed implicit and explicit faith in corporations acting in their best interests, to a ‘tell me and show me’ culture in which stakeholders want reassurance that organisations will do what is morally right (Sustainability/UNEP 1999: 5). Stakeholder dialogue and participation can be the key to unlocking the opportunities inherent in the emerging ‘involve me’ culture and turning it practically into competitive advantage.