There was a time when it was good enough just to listen. When corporate execs got credit for sitting at the table with an NGO and benefited from a “different perspective.” Their obligation was to “thoughtfully consider” the input in the development of their business plans, strategies and actions. But as the business environment and the sustainability agenda has evolved, so too has best practice in stakeholder engagement.
Don’t get me wrong. I am not saying there wasn’t business value in listening — there was. It was in fact a refreshing shift from the “convince” model of engaging with stakeholders. The previous model was born of the commonly held belief among many corporate executives that the analysis their staff had done on risks to their business was fact-based, robust and complete.
The problem, if there was one, was that the company just hadn’t done a good enough job in communicating their good deeds, or the rationale for not doing more.
So, the thinking went, let’s bring these stakeholders in, wow them with Powerpoint presentations on our business, our corporate social responsbility achievements, and the commitment of our employees to the communities they serve, and then not only will the NGO’s get off our backs, but they will become our advocates. Oh, and while they are at the table, we should show some respect and listen to what they have to say.
Often what they had to say was actually a pretty useful perspective to hear, if for no other reason than to understand how different people thought about the world, its challenges and its solutions. So “gaining perspectives and insights” became an objective of structured stakeholder engagement.
In fact, for much of the work that SustainAbility does with our clients on stakeholder engagement, this remains an important objective which we state explicitly in the Terms of Reference.
But merely listening and “thoughtfully considering” leaves a lot of value on the table. One of my clients a few years back, when they were just embarking on a structured stakeholder engagement strategy, was so intent at being good listeners (on my recommendation) that at our first break in the morning during one of their first stakeholder roundtables I had to tell them to speak up and be a more active part of the conversation.
Hence a shift to the next phase in the evolution: exchange. This in fact was a quick transition, putting companies back more in their comfort zone where they felt free to respond to and debate what they were hearing from their stakeholders.
This is where many companies are now stuck — their stakeholder engagement consists of an exchange of views. Post-exchange, it is left up to the company to decide what to do, what policies to change (if at all), what issues to address, what actions to take.
Our biggest sustainability challenges (aka societal and business challenges) — poverty, access to water, access to healthcare, climate change, biodiversity loss — are long-term, and require enormous shifts in markets, policy and behavior to fix.
The capacity of an individual company to make any headway on those challenges requires difficult changes implemented over a long period of time. The changes must be made in a way that retains the confidence of their investors (and hence maintains or improves the stock price), or management will be shown the door. Progress is never as quick as activists believe it should be.
So this sets up something of a Groundhog Day dynamic, where stakeholders come to the dialogues every year and restate their case for action, and the company restates its commitment to “thoughtfully consider” what they heard, and everyone goes away not quite satisfied.
It should not be surprising then that the leading edge has moved from stakeholder engagement to stakeholder involvement, stakeholder collaboration, stakeholder partnerships.
OK, so this is not exactly a new idea. Partnerships between companies and NGO’s and other stakeholders have existed for a long time. Some partnerships are solving — or at least making progress on — real-world problems. Witness the partnership between WWF and Coca-Cola [PDF], now in its 5th year, addressing the global water crisis. Or the Conservation International/Starbucks partnership, focused on promoting sustainable coffee production practices. The U.S. Climate Action Partnership (USCAP) was a collaboration of NGO’s and progressive businesses in the US who found common cause in pushing for cap-and-trade legislation.
Diverse organizations are finding more ways to work together, not just talk together. They are leveraging each others’ respective strengths to work on issues of common concern. Recently, the sportswear industry has engaged with Greenpeace and the chemical industry to find a way to make sportswear free of toxins in a collaboration that also involves SustainAbility.
My colleague Mohammed Al-Shawaf stated the case for collaboration most eloquently in his year end trends blog post: “…there is a realization that it’s simply impractical to wait for the genius of one company’s R&D team or a particular NGO’s issue expertise and influence to develop the kind of breakthroughs that are required to advance sustainable development. Systemic change, the kind increasingly called for on a wide range of issues, requires strength in numbers and friends in unlikely places.”
That sounds simple enough, but it is by no means easy. Moving from exchanging to collaborating requires clearly defined objectives, aligned interests, and a willingness by all parties to put in the necessary time and effort (and sometimes cash).
It requires a shift in the mindset of NGO’s whose key question was once “what should the company do to address this challenge,” to think about “what can we contribute in addressing this challenge together.”
It requires a shift from corporations as well, ceding some authority to share decision-making with its fellow collaborators. And all participants should be asking, “what skills, knowledge, relationships and capabilities do we have that, when combined with our partners, can move the needle”.
Developing an effective collaboration takes time, energy, commitment and focus. Collaborations work when the objective is clear, the commitment is unwavering, and all parties offer up the skills, knowledge, relationships and capabilities they possess which, when combined with others’, can move the needle on the sustainability challenges we all face.
This article originally appeared as part of SustainAbility’s Changing Tack column on GreenBiz.com.