The Stakeholder Engagement Imperative. Seminar Paper: Oxford University Center for Corporate Reputation
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The document discusses the critical importance of stakeholder engagement for protecting corporate reputation, highlighting that many companies struggle with effective engagement despite recognizing its significance. It presents strategies and tools for identifying and managing stakeholders, including methodologies for analyzing influence networks and early warning systems for potential issues. The document emphasizes that proactive engagement is essential for maintaining a positive reputation in a complex and rapidly changing business environment.
The Stakeholder Engagement Imperative. Seminar Paper: Oxford University Center for Corporate Reputation
- 1. The Stakeholder Engagement Imperative The background • Reputation - a top 3 corporate priority existing only in the mind of the beholder. Tangibles vs. Intangibles Our experiences • Reputation matters most in the context of issues and the key to protecting reputation is good stakeholder management. However most companies fail at this. New Strategies and tools • To help corporations identify, manage and engage better Terence Lyons Managing Director The Stakeholder Company [email protected] www.thestakeholdercompany.com
- 2. # 1 The background • Reputation - a top 3 corporate priority existing only in the mind of the beholder. Tangibles vs. Intangibles
- 3. Familiar ground - Corporate reputation… the sum of all parts Reputation does not exist
- 4. Familiar ground - Corporate reputation… the sum of all parts Except... Within a network Somewhere For something
- 5. This business cycle - It’s all about corporate reputation #1 CEO priority today • Good reputation pays, bad reputation costs • 67% of top executives our reputation is vulnerable A perfect storm The reputation management Declining trust in business team + Increasing number, significance Corp comms, Government & complexity of new relations, regulatory stakeholder groups affairs, general counsel, + PR, marketing, corporate New communication channels, social responsibility and tactics and engagement styles investor relations + Increasing threats = Board level risk Vs.
- 6. And it’s a shifting target Non-customer stakeholders are increasingly critical stakeholders to the corporation 4x UN accredited NGO’s McKinsey statistics from a survey of 1,400 global executives in January 2011 It’s all about economic value protection and creation
- 7. Proactive and regular stakeholder engagement is critical Top #3 CEO priority for 50%+ But companies are not very good at it 71% - believe proactive & regular • Only 43% engage proactively and regularly government engagement is critical regardless of immediate interest • Less than a 1/3rd – “we are very effective at relationship building with governments” • Less than ¼ believe they succeed in influencing government decisions or that their opinions are valued and sought by government McKinsey statistics from a survey of 1,400 global executives in January 2011
- 8. Familiar ground - Corporate reputation… the sum of all parts Years to build… hours to destroy.
- 9. # 2 Our experiences • Reputation matters most in the context of issues • Business has rarely been faced with more issues • The key to protecting reputation is good management stakeholder networks
- 10. Deconstructing the big issue Issue Modeling Variable velocity Issue Phases
- 11. Deconstructing the big issue The public interest (attention) cycle Public Interest Attention Interest Outrage …
- 12. Where: P = Probability of occurrence (0% – 100%). V = Vulnerability of News Corp to the impact ( S = Sentiment or likely public perception of the experience Outrage=(P+V)S x T ⁄ (R x I ) T= The time frame in which News Corp knew of the practices without taking remedial action. R = the reputation of the firm -3 (reviled) to 0 (neutral) to +3 (love and adulation) I = Influence News Corp has to get 3rd party opinion leader support and protection.
- 13. Deconstructing the big issue The bottom line business impact Business Impact/ Cost to company Public Interest
- 14. Deconstructing the big issue Dwindling options to ‘control’ / shift / influence the issue Company control Business Impact/ Cost to company Public Interest
- 15. Deconstructing the big issue Corporate levers, tools and strategies GR/ External Affairs PR IC Legal, Compliance, Reg team
- 16. Deconstructing the big issue Too little, too late, too disconnected, too (yawn…) Opportunity Zone GR/ External Affairs PR IC Legal, Compliance, Reg team
- 17. Deconstructing the big issue A rich opportunity Competitive advantage Business Benefit $
- 18. Deconstructing the big issue Seized early Identification Strategy Stakeholder engagement
- 19. Step 1 Identification • Flashpoint Analysis • Early warning radars • etc Identification
- 20. Step 2 Strategy Strategy
- 21. Step 3 Stakeholder The big failure point Engagement Who are our stakeholders? How do we identify the issue influencers? How do we reach out and engage them? ? Stakeholder engagement Joe Blogs Acme Ltd. Director Public Affairs Asia
- 22. Step 3 Stakeholder Engagement Key questions Scale: many more new stakeholders exercising influence over strategy than ever before. How can we identify these and influence them? Style: our traditional audience is being influenced in Stakeholder many new ways. How can we leverage these new means engagement and tools of influence? Organization: a new nimbler and more communication savvy class of advocates and opponents is proving more capable of influencing opinion than us. How can we increase agility and execution capability?
- 23. Step 3 Stakeholder Engagement Stakeholder engagement
- 24. #3 New Strategies and tools • To help corporations identify, manage and engage better
- 25. New Strategies and tools Methodologies Stakeholder engagement
- 26. New Strategies and tools Technology Stakeholder engagement
- 27. New Strategies and tools Influence Mapping – ranking by max # of geodesics (shortest paths) • Is there an emerging issue? • Who’s influencing the debate? • How hot is the issue? • Who’s the most credible? • What may hit the press soon? • Who could amplify our message?
- 28. New Strategies and tools What does it do? • Generates a ‘snap shot’ of influence • Maps millions of data points into a clear synthesis of key influencers, organizations, topics, conversation patterns, inter-linkages, network centrality and authority How does it work? Patented issue mapping and visualization software: • Combines social network theory algorithms, crawlers, analysis engines and For each node in graph – how many visualization modules. geodesics is it on? • Crawls the Internet for content and link structure and blogosphere and Twittersphere for immediacy • Analyses the shortest path (geodesic) between nodes
- 29. In action: what’s happening with the “Palm Oil” debate?
- 30. The Peru mining debate Wires, press Investor community Liberal Media Mining community Anti-Mining community
- 31. In action: The Peru mining debate
- 32. Papua New Guinea and the Resource Ownership Debate PNG Resource ownership Local and S.Pacific news and wires Australian news Faith based orgs Academic IGO NGO / Activist community
- 33. Papua New Guinea and the Resource Ownership Debate PNG Resource ownership Local and S.Pacific news and wires Australian news Martyn Namorong Faith based orgs Influential Blogger: The Namorong Report Academic IGO NGO / Activist community
- 34. The PNG Stakeholder Blueprint Systematic mapping of opinion leaders and stakeholders to issues & opportunities Collection Updating The PNG Key Stakeholder Database* * Illustrative only
- 35. Papua New Guinea - PNG Resource ownership
- 36. The Influence Grid – technology and data applied to the business of influence
- 37. Thank you Terence Lyons Managing Director The Stakeholder Company [email protected] www.thestakeholdercompany.com