ESG Metric: Stakeholder materiality
Ease of implementation: Medium
Suitable for: All businesses
Suggested functional lead: Senior leadership team
Summary
Stakeholder engagement can be improved through implementing a stakeholder engagement plan and setting up a formal policy. The first step to achieve this is identifying your key stakeholders and stakeholder groups and assessing their influence level. Then, a policy can be drafted following the template below. Following the drafting of a policy, the engagement plan can be developed. It is crucial to set targets and deadlines for the stakeholders as well. To ensure the engagement plan is successful, build a communications plan to ensure everyone can stay informed and updated. Collect and provide feedback to the stakeholder groups for continuous improvement in stakeholder engagement.
Background Information
Companies need to interact with important stakeholders to survive in a challenging business world. It is thus, vital to set up a robust stakeholder engagement model to understand and respond to stakeholder concerns. Interaction with stakeholders can occur at various levels within the organisations and in different formats. The process of the engagement is often ad-hoc, lacking a formal process and structure. A formal stakeholder engagement policy can be created to greatly enhance the values of stakeholders and mitigate the risk of missing out on crucial information.
Implementation Steps
Identify your key stakeholders and stakeholder groups
Identify and collate a list of your stakeholders. These can include internal stakeholders such as project managers, or external stakeholders such as clients, customers, investors etc.
Identify your stakeholders influence level
Identify your stakeholder influence level and their dependence on your organisation to determine which ones to prioritise. The most crucial stakeholders to engage with are usually the ones highly dependent on your organisation and visaversa.
Draft a policy
Draft a stakeholder engagement policy outlining the process employees should follow when engaging with stakeholders. Ensure the policy contains background information on your organisation and ways of working. Outline the logic of the policy and the impact it will have on improving stakeholder engagement.
Develop an engagement plan
Ensure the plan is consistent with your regular cycle of working, ie. quarterly, to ensure any changes can be captured and addressed within reasonable time. Ensure you set targets, deadlines and expectations for those involved in stakeholder interactions.
Build a communications plan
With help from the stakeholder engagement plan, ensure information and updates are being communicated to the stakeholders. You may want to store all information of all projects in one place, like a project management tool, to easy accessibility. Identify what type of communication each stakeholder needs, as some may require real-time insight while others will only require an overview of the project timeline. See example of a communication plan for a potential stakeholder below:
Description | Frequency | Channel | Audience | Owner |
Project Status updates | Weekly | All internal stakeholders and project team members | Project manager | |
External stakeholder updates | As needed | Zoom | Project manager and project stakeholders | Project sponsor |
Provide feedback to stakeholder groups
The engagement plan should include feedback from the engagement process to the stakeholders your company has interacted with. Make any changed to the engagement plan if necessary to ensure continuous development.