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COMMUNITY ENGAGEMENT 101
A CASE STUDY FOR BEST PRACTICE
Reana Rossouw
Next Generation Consultants
QUESTION?
What is the difference
between general
stakeholder engagement
and community
engagement?
2016/04/10 NEXT GENERATION CONSULTANTS 2
STAKEHOLDER ENGAGEMENT IS ….
Stakeholder engagement can be described as an organisation’s efforts to
understand and involve stakeholders and their concerns in its activities and
decision-making processes.
The purpose of stakeholder engagement is to drive strategic direction and
operational excellence for an organisation. Done correctly, engaging stakeholders
can result in learning, innovation, and enhanced performance that will not only
benefit the organisation, but also its stakeholders and society as a whole.
In addition to serving as a key tool to support a company’s sustainability reporting
efforts, stakeholder engagement can be seen as a foundation that supports an
organisation’s broader sustainability efforts to set strategic goals, implement
action plans, and assess its performance over time.
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QUESTION? Why conduct stakeholder
engagement?
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VALUE OF STAKEHOLDER ENGAGEMENT (1)
Anticipate and manage emerging issues
A mechanism to improve an understanding of stakeholder priorities and to respond to emerging stakeholder concerns
To identify, evaluate, address and improve sustainability performance issues before they become threats or lost
opportunities
Helps ensure that a company can consistently convey complete, comparable, inclusive, responsive and accurate
information to the outside world
Promote productive collaboration with stakeholders
Creates an information sharing platform whereby organisations can disclose specific information i.e. performance,
practices, strategies and goals to stakeholders (to enable them to make informed decisions)
Serves as an opportunity for stakeholders to identify impact/risk areas about which they have a concern
Creates opportunities to discuss priority issues together with stakeholders thereby building trust and collaboration via
dialogue
Allows for increased, shared understanding of the company’s impacts, improvements and challenges, whereby
organisations and stakeholders can build consensus to find solutions and set goals to address challenges
To reduce/mitigate negative reactions to future, unforeseen incidents and/or impacts because of better
understanding and communication
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VALUE OF STAKEHOLDER ENGAGEMENT (2)
Improve decision-making and operational performance
Allows a company to align its management plans and actions with the expectations,
needs and demands of key stakeholders
Helps streamline responses to various information requests, and thereby potentially
reduce reporting redundancies and time burdens
Enables companies to maximize opportunities for improving resource management and
risk management by tracking performance over time
Helps engage and motivate staff who are responsible for various aspects of performance
Leverages performance improvements as the organisation works to follow through on
agreed commitments
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CORE VALUES FOR THE PRACTICE OF
STAKEHOLDER ENGAGEMENT
Stakeholders should have a say in decisions about actions that could affect their
lives or an essential environment for life (good quality of life)
Stakeholder participation includes the promise/commitment that stakeholder’s
contribution will influence management/operational decisions
Stakeholder participation promotes sustainability decisions by recognizing and
observing the needs and interests of all participants
Effective stakeholder engagement:
Ensures participants are equipped to engage
Ensures participation from the start (designing engagement) to the end (communicating and reporting
on the outcomes of the engagement
Ensures agreement on input decision-making (how input will be utilised)
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QUESTION?
How is stakeholder
engagement different to any
other form of communication?
2016/04/10 NEXT GENERATION CONSULTANTS 8
IN THE BEGINNING
Before any expensive and lengthy engagement process can begin, it is important to have a
good understanding, and indeed consider what level of participation is actually being
sought. Public participation can be broadly categorised into the following:
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Levels of public participation goals
Inform To provide the public with balanced and objective information to assist them in understanding the
problem, alternatives, opportunities, and/or solutions
Consult To obtain public feedback for decision-makers on analysis, alternatives and/or decisions
Involve To work directly with the public throughout the process to ensure that public concerns and
aspirations are consistently understood and considered in decision-making processes
Collaborate To partner with the public in each aspect of the decision making process including the development
of alternatives and the identification of the preferred solution
Empower To place final decision-making in the hands of the public
WHY IS STAKEHOLDER ENGAGEMENT SO DIFFICULT?
Stakeholder management is difficult because it involves different people with different
expectations and different information needs.
Engaging stakeholders for collaboration involves constant vigilance in a constantly
changing landscape of relationships with stakeholders whose support, interests and
influence fluctuates unpredictably.
Why is stakeholder engagement so
expensive?
2016/04/10 NEXT GENERATION CONSULTANTS 10
STAKEHOLDER ENGAGEMENT 101
Engagement is but one form of stakeholder relations along a spectrum of possible interactions that also
include activities like message delivery, media outreach, deal negotiations, lobbying, coalition development,
advocacy, damage control, research surveys, focus groups, issue management and benchmarking.
Stakeholder engagement is when the company initiates open, two-way dialogue seeking understanding
and solutions to issues of mutual concern.
It involves discovering and may result in implementing ideas that benefit both stakeholders and the
company. This is not the same thing as opinion research, message delivery, lobbying, constituency relations or
grant making or sales or wage negotiations.
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DIFFERENTIATION IN ENGAGEMENT
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BUILDING BLOCKS OF STAKEHOLDER ENGAGEMENT
Stakeholder engagement is an umbrella term
encompassing a range of activities and
interactions:
Stakeholder identification and analysis
Information disclosure
Stakeholder consultation
Negotiation and partnerships
Grievance management
Reporting to stakeholders
Management, governance, compliance, risk
management functions
Stakeholder involvement in project/process
monitoring
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DEFINITIONS WITHIN THE CONTEXT
Communication:
Any manner of information sharing with stakeholders, generally through one-way, non-iterative processes
Consultation:
The process of gathering information or advice from stakeholders and taking those views into consideration to
amend plans, make decisions or set directions
Dialogue:
An exchange of views and opinion to explore different perspectives, needs and alternatives, with a view to
fostering mutual understanding, trust and cooperation on a strategy or initiative
Engagement:
An organisation’s efforts to understand and involve stakeholders and their concerns in its activities and
decision-making processes
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Reference: Stakeholder Engagement Manual – Page 6, UNEP, Volume 1 – www.stakeholderresearch.com
SPECTRUM OF ENGAGEMENT
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ONE SIDED INSTRUMENTS
•Customer Satisfaction
•Supplier Surveys
•Employee Surveys
•Stakeholder Opinion Surveys
•Self Assessments
•Stakeholder Perceptions
•Balance Scorecards
•360 Degree Frameworks
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Investor Relations
Customer
Relations
Human Relations
Media Relations
Industrial
Relations
Public Relations
STAKEHOLDER MANAGEMENT PROCESS
Context
• Objectives,
approach,
expectations
• Identify
relationships
(issues & risks)
• Stakeholder
identification &
prioritisation
• Buy in & support
both parties
Data
• Sampling – how
many
• Methodology of
communication
• F2F, telephone,
etc.
• Questionnaire
Analysis
• Interpret Data
• Link to business
objectives &
outcomes
• Discuss results of
engagement -
collectively
• Report results of
engagement
Report
• Highlight strengths
and weaknesses
• Highlight areas of
impact
• Highlight areas of
risk
• Highlight areas of
differences/
similarities
• Recommendations
– Stakeholder
Management Plan
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QUESTION?
Who are stakeholders?
How are stakeholders
categorised?
How are stakeholders
prioritised?
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WHAT ARE STAKEHOLDERS?
By definition, stakeholders have a stake in
the company/the issue, or who may
experience losses or be harmed as a result
of the operations of a company
A person, group, or organisation that has
direct or indirect stake in an organisation
because it can affect or be affected by the
organisation's actions, objectives, and
policies.
Although ‘stakeholding’ is usually self-
legitimising (those who judge themselves to
be stakeholders are a stakeholder), all
stakeholders are not equal and different
stakeholders are entitled to different
considerations.
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WHO ARE STAKEHOLDERS?
A stakeholder can be defined as any person, or group, who has an interest/stake in a
project/process or strategy or could be potentially affected by its delivery or outputs.
Stakeholders is often categorised into ‘groups’ based on a number of factors including:
Geographic boundaries or location
Recognised bodies or institutions
Income groups
Land ownership or occupation
Legal requirements
Real or perceived views of the issue under dispute
The nature of stakeholder classification means that stakeholder groups are usually not
homogenous entities.
It is more likely in fact, that an identified stakeholder group will comprise a diverse mix of individuals,
who may – or may not – identify themselves with the particular “stakeholder group” into which they
have been categorised.
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IDENTIFYING COMMUNITY STAKEHOLDERS
General Company Stakeholders
Customers
Employees
Media
Suppliers
Government
Communities
Specific community stakeholders
Program
Implementers -
Intermediaries
Co-Funding
Partners
Program
Influencers –
Government
Direct Program
Beneficiaries
Indirect
Program
Beneficiaries
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ANALYSING AND PRIORITISING STAKEHOLDERS
Community Stakeholder Groups
Program Approvals
• Local Wards
• Traditional Councils
• School Principles/Councils
Program Approvals
• Government Departments
• National/Provincial/Local
Program Influencers –
Program Design
• Co-Funders
Program Influencers –
Program
Implementation
• NGO’s
Program Beneficiaries
–
Direct/Indirect
Let’s Test It: Program Funding:
Education
Sport
Health
Disaster Relief
Funder(s)
Media
Local Interest Groups (Cleaner Air/Tax
Payers/Media/
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Let’s Test It: Program M&E/Reporting:
ANALYSING STAKEHOLDERS
Segmentation
Primary
Secondary
Tertiary
Others
Cause Related Programs
Donation/Sponsorship
Comparative/Competitive
Geographic spread
Sample Sizes
Depends on
Available Data
Age of Data
Budget
Resources
Engagement Methodology(ies)
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Prioritising / Sample Sizes
Determining the boundaries/objectives and outcomes of
community engagement
IDENTIFYING STAKEHOLDERS
Primary stakeholders are those stakeholders that have a direct stake in the
organisation and its success
Secondary stakeholders are those that have a public or special interest in the
organisation
Core stakeholders are essential to the survival of the business/program
Strategic stakeholders are vital to the organisation and/or the threats and
opportunities the organisation faces (current or future)
Environmental stakeholders are all others in the organisation's environment
Legitimacy refers to the perceived validity of the stakeholder’s claim to a stake
Power refers to the ability or capacity of a stakeholder to produce/influence an effect/risk
Urgency refers to the degree to which the stakeholder’s claim demands immediate attention
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OTHER CONSIDERATIONS (1)
Who decides who is involved
As the selection of participants can be a politically charged responsibility, the selection process must be as transparent
as possible.
It is wise to ensure that the reasons for selection are noted/documented so that any questions about
selection/prioritisation can be answered.
Resist pressure on numbers
There is often internal and external pressure to expand or reduce the list of those involved.
The number of people involved should not be arbitrary but based on a coherent understanding of the purpose and the
context of the engagement process.
Marginalising “Usual suspects”
Organisations sometimes try to avoid involving the “usual suspects”, which has become a term of denigration for people
who habitually give time and effort to what they see as their civic responsibilities.
Describing someone as a ‘usual suspect’ should never be grounds to exclude them from a process any more than it is
grounds for including them: people should be involved because they are the right people.
Opponents
It is equally wrong to exclude an individual or an organisation for being a known opponent of a given purpose or
process. There are often good reasons for keeping opponents “inside the tent”: these can be the people who most need
to be involved so that they gain some ownership of the process and perhaps become more likely to support the final
outcome (or at least, less inclined to undermine it as they might have, had they been excluded).
2016/04/10 NEXT GENERATION CONSULTANTS 25
OTHER CONSIDERATIONS (2)
Hard to Reach Groups
It is important to try to include all relevant stakeholders, and those who often get omitted are the hard to reach groups. Extra effort
and innovation will be needed to contact and engage with these groups or individuals, who do not generally come forward by their
own volition. Including these minority or “hard to reach” groups is important to obtaining a more balanced picture from the
engagement process.
Everyone does not have to be involved in everything
With good planning, and the agreement of participants, different people can be involved only in those parts of the process which
are most relevant to them.
Campaigning organisations
Many campaigning bodies, especially national civil society organisations, are constantly asked to be involved in participatory
exercises, and do not always see these as the most effective use of their limited resources.
In addition, some see the compromise that can be inherent in some participatory processes as conflicting with their primary purposes.
It can be useful to consider (and discuss with them) at which stage of the policy process NGOs are best suited to participate: agenda
setting, policy development, policy implementation or policy review.
What’s In It for Them (WIIFT)?
It is important to consider and discuss with participants what they want to get out of the process and what could prevent them from
participating. If everyone’s motivations can be clarified at the start, there will be less confusion and everyone is more likely to be
satisfied with the outcomes. This is especially important in an area that is suffering from consultation/engagement fatigue.
2016/04/10 NEXT GENERATION CONSULTANTS 26
IDENTIFYING STAKEHOLDERS
Be systematic
Consider all aspects of the company’s area of influence, e.g. technical, business, geographical etc.
Remember the interest groups
Identify those groups or organisations that are not directly impacted by the company e.g. but whose interests
determine them as stakeholders e.g. Security personnel or unions, media, etc.
Use past stakeholder information
Referring to previous similar projects can save time and highlight stakeholders risks, liabilities, or unresolved issues that
can then be included in the analysis.
Consider the entire project lifecycle/company stage (growth/startup/mature)
It is important to remember that both stakeholders and their interests may change as the company evolves and
progresses. Consider all stages of the company life cycle (prospecting, start-up, growing, operational, closing) when
drawing up the stakeholder list and review it regularly as the stakeholder process matures.
People matter
Although stakeholders may be both organisations and people, ultimately you can only communicate with individual
people. Make sure that you identify the correct individual stakeholders within each stakeholder group. Remember
people are mobile and therefore stakeholders change all the time.
2016/04/10 NEXT GENERATION CONSULTANTS 27
QUESTION?
How to engage?
What would constitute
engagement?
2016/04/10 NEXT GENERATION CONSULTANTS 28
STAKEHOLDER ENGAGEMENT TOOLS (1)
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Technique Most appropriate application Main advantages and disadvantages
Personal
Interviews
• Identify issues specific to each stakeholder
• Provide opportunities for stakeholders to
speak confidentially
• Build relationships with individual stakeholders
Advantages:
• Demonstrates commitment on part of the company
• Provides an opportunity to build relationships
• Provides detailed data through two-way communication
Disadvantages:
• Time and resource intensive
• No opportunity to test attitudes and assertions independently
• Individuals may not necessarily be representative of a stakeholder group as a
whole
Workshops • Form relationships with and between high
level stakeholders and experts
• Involve stakeholders in thinking through
issues, to develop a strategic approach or
resolve an issue/s
• Communicate aspects of stakeholder
engagement process or issues management
to stakeholders and employees
• Analyze impacts
• Prioritize/rank issues and potential solutions
Advantages:
• Demonstrates commitment on part of the company
• Provides an opportunity to build a network of relationships
• Allows issues to be verified, tested and solutions developed
• Increases ownership by participants
Disadvantages:
• Participation is limited to a relatively small number of stakeholders
• Individuals may not necessarily be representative of a stakeholder group as a
whole
• Need to provide sufficient information beforehand such that participants can
provide informed views/opinions/solutions
STAKEHOLDER ENGAGEMENT TOOLS (2)Technique Most appropriate application Main advantages and disadvantages
Focus Groups /
Forums
• Identify stakeholder views on a specific issue
• Discuss the views of a common interest stakeholder group
• Gather baseline data
• Support, pilot, test or gain feedback on the outputs of
other methods (e.g. surveys, interviews)
• Determine stakeholder responses/views/opinions to
proposed mitigation / risk based strategies
• Monitor and evaluate social/environmental or economic
performance of an organisation/operation
Advantages:
• Demonstrates commitment on part of the company
• Provides an opportunity to build a network of relationships
• Allows issues to be verified, tested and solutions developed collectively
• Increases ownership by participants
Disadvantages:
• Participation is limited to relatively small number of stakeholders
• Individuals may not necessarily be representative of a stakeholder group or community as a
whole
• Need to provide sufficient (sometimes sensitive) information such that participants can provide
informed views/opinions/input
Public or ‘Town Hall”
meeting
• Reach large audiences in particular communities quickly
• Present information and seek feedback from stakeholders
instantaneously
• Ensure that everyone gets a change to provide comment /
criticism / feedback
Advantages:
• Relatively inexpensive and quick
• Allows reach of a large number of people simultaneously
• Demonstrate willingness to be open to public criticism
• Provides communities with opportunity to speak directly to company representatives
Disadvantages:
• There is a risk that vocal but unrepresentative groups may ‘hijack’ the meeting
• Some communities or groups within them, may not be comfortable speaking in such a public
forum
• Limited opportunity to explore issues of particular stakeholders in detail
• Can be difficult to facilitate if the issue(s) under discussion is/are controversial or highly emotive
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STAKEHOLDER ENGAGEMENT TOOLS (3)
Technique Most appropriate application Main advantages and disadvantages
Surveys • Identify stakeholder issues and assess
community needs
• Obtain an objective overview of a
group of stakeholders to a particular
issue or potential impact
• Develop mitigation / risk-based
strategies
• Gather data for evaluation or
reporting quickly
• Monitor and compare data/ impacts
and performance using repeat surveys
Advantages:
• Provides detail data on specific issues
• Assuming an appropriate sample is gathered, provides a
good insight to the extend of an issue/s or significance of
an issue within a community
• Widely known and acceptable methodology
Disadvantages:
• Written surveys are not appropriate in an environment
where literacy levels/technology access are low
• Can be easily manipulated or designed to yield
particular results
• Depending on the response method, surveys generally
yield poor/low response rates
• Surveys take considerable time and resources to prepare,
implement and analyze results
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STAKEHOLDER ENGAGEMENT TOOLS (4)Technique Most appropriate application Main advantages and disadvantages
Participatory
Tools
• Scope and identify community needs
/ aspirations
• Involve stakeholders in the
development of engagement tools
• Monitor and evaluate social/human
rights/ environmental impacts and
performance over time per aspect
Advantages:
• Demonstrates commitment on part of the company
• Provides the opportunity to build relationships and stakeholder ownership of
outcomes
• Can gain in-depth understanding of stakeholder cultures, beliefs, assets and
interactions
Disadvantages
• Need to manage conflicting community demands
• Can result in unrealistic community expectations
• Process can be dominated by well articulated and organised stakeholder groups
Stakeholder
Panels
• Provide detailed, expert, specific
input into strategies
• Give expert guidance on company
direction, development of new
products / services
• Share industry/context specific
information, developments, progress
Advantages:
• Examines specific aspects of corporate policy, action or performance
• Produce comments or recommendations upon which the company may or may not
make specific commitments
• Assists company in receiving advice, gauge expectations and criticism
• May anticipate possible threats to activities/issues that may arise in future
Disadvantages
• May not be representative
• May not have expertise in specific subject/or in issues
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ENGAGEMENT STANDARDS,
FRAMEWORKS AND GUIDELINES
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GRI REPORTING REQUIREMENTSDefinition:
The reporting organisation should identify its stakeholders and explain in the report how it has responded to their
reasonable expectations and interests.
The reasonable expectations and interests of stakeholders are a key reference point for many decisions in the
preparation of a sustainability report, such as the scope, boundary, application of indicators, and assurance approach.
Stakeholder engagement processes can serve as tools for understanding the reasonable expectations and interests of
stakeholders.
For a report to be assurable, the process of stakeholder engagement should be documented and they should be based on
systematic or generally accepted approaches, methodologies or principles.
The reporting organisation should:
Document its approach for defining which stakeholders it engaged with, how and when it engaged with them, and how engagement has influenced the
report content and the organisation’s sustainability activities (strategies and reports).
Tests:
The organisation can describe the stakeholders to whom it considers itself accountable.
The report draws on upon the outcomes of stakeholder engagement processes used by the organisation and as required
by legal and institutional frameworks in which it operates.
The report content draws upon the outcomes of any stakeholder engagement processes undertaken specifically for the
report.
The stakeholder engagement processes that inform decisions about the report content are consistent with the scope and
boundary of the report.
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KING III AND STAKEHOLDER INCLUSIVENESS
The Board should:
Appreciate that stakeholders’ perceptions affect a company’s reputation
Identify important stakeholder groupings
Delegate to management to proactively deal with stakeholder relationships
Disclose in its integrated report the nature of the company’s dealings with stakeholders and the outcomes of these
dealings
Strive to achieve the appropriate balance between its various stakeholder groupings, in the best interests of the
company
Take account of the legitimate interests and expectations of its stakeholders in its decision-making in the best
interests of the company
Adopt communication guidelines that support a responsible communication programme
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Reference: King III – www.IOD.co.za
KING III - STAKEHOLDER ENGAGEMENT GOVERNANCE
Board roles and responsibilities
Define stakeholder engagement as a core value
Identify, discuss and prioritize key risks associated with changing societal expectations
Determine the stakeholders financial and non-financial information needs for decision-
making, management oversight, and monitoring key stakeholder relationships associated
with generating value and wealth
Discuss and approve key performance indicators for social, environmental, and
financial performance
Approve a policy for external reporting
Integrate stakeholder issues into annual general meetings of shareowners
Discuss the risks and impacts of projects and operations and provide transparent
disclosure information to shareowners and other key stakeholder groups
Convene stakeholder forums and invite key stakeholder representatives to address
board meetings
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THE COMPANIES ACT AND STAKEHOLDERS (1)
Social and Ethics Committee
Companies Act, Number 71 of 2008 became effective 1 May 2011
Sought to modernise and ‘simplify’ company law
Many changes to regulatory, accountability, transparency and governance requirements
Section 72 (4) and Regulation 43 (2) requires a Social and Ethics Committee for applicable companies
Reasons – Stakeholder governance model in SA (not just about shareholders – refer also King III)
To monitor the company’s activities, having regard to relevant legislation, to other legal requirements, or prevailing
codes of best practice. To draw matters within its mandate to the attention of the board and to report to shareholders
at the AGM
Scope of matters
Social and economic development
Good corporate citizenship
The environment, health and public safety
Consumer relationships
Labour and employment
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Reference: Companies Act No. 71 of 2008
COMPANIES ACT (2)
The Regulations prescribe that a Social and Ethics Committee has the following functions:
1) To monitor the company’s activities, having regard to any relevant legislation, other legal requirements
or prevailing codes of best practice, with regard to matters relating to:
Social and economic development, including the company’s standing in terms of the goals and purposes of-
The 10 principles set out in the United Global Compact Principles;
The OECD recommendations regarding corruption;
The Employment Equity Act; and
The Broad-Based Black Economic Empowerment Act;
Good corporate citizenship, including the company’s-
Promotion of equality, prevention of unfair discrimination, and reduction of corruption;
Contribution to development of the communities in which its activities are predominantly conducted or within which its products or services are predominantly
marketed; and
Record of sponsorship, donations and charitable giving;
The environment, health and public safety, including the impact of the company’s activities and of its products or services;
Consumer relationships, including the company’s advertising, public relations and compliance with consumer protection laws; and
Labour and employment, including-
The company’s standing in terms of the International Labour Organisation Protocol on decent work and working conditions; and
The company’s employment relationships, and its contribution toward the educational development of its employees;
2) To draw matters within its mandate to the attention of the Board as occasion requires; and
3) To report, through one of its members, to the shareholders of the company’s annual general meeting on
the matters within its mandate.2016/04/10 NEXT GENERATION CONSULTANTS 38
INTEGRATED REPORTING AND STAKEHOLDERS - IIRC
An Integrated Report should provide insight into the nature and quality of the organisation’s
relationships with its key stakeholders, including how and to what extent the organisation
understands, takes into account and responds to their legitimate needs and interests.
Stakeholders provide useful insights about matters that are important to them, including economic,
environmental and social issues that also affect the ability of the organisation to create value.
Understand how stakeholders perceive value
Identify trends that might not have come to the general attention, but which are rising in significance
Identify material matters, including risks and opportunities
Develop and evaluate strategy
Manage risks
Implement activities, including strategic and accountable responses to material matters
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STAKEHOLDER ENGAGEMENT STANDARD:
ACCOUNTABILITY AA1000SES
Definitions:
Stakeholder Inclusivity is the participation of stakeholders in developing and achieving an accountable and strategic
response to sustainability
Stakeholder Engagement is a tool that organisations use to help them achieve inclusivity
Companies using AA1000SES must:
Commit publicly that they used the Standard and that they will follow the principles of materiality, inclusiveness and
responsiveness
Integrate stakeholder engagement into governance and decision-making (strategy and operational) processes
Define the purpose and scope of engagement
Have a process for stakeholder engagement
Have a stakeholder engagement plan/strategy
Profile/map of stakeholders
Determine the engagement level and methods
Establish and communicate boundaries of disclosure
Establish indicators to measure the quality of stakeholder engagement
Document the engagement and outputs
Develop an action plan
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Reference: AccountAbility Stakeholder Engagement Standard (AA1000SES) 2011 – www.accountability.co.uk
IFC STAKEHOLDER ENGAGEMENT
Handbook provides guidance on stakeholder engagement specifically for:
Mining/extractive industries on stakeholder engagement processes as it pertains to:
ESIA – Environmental, Social Impact Assessments
Mine Closure, Site Selection and Construction, Social and Labour Plans, Industry Specific Guidelines – i.e.
ICMM
Financial and Development Institutions
Equator Principles – Responsible Lending
Service Industries
Perception Surveys, Grievance processes and mechanisms
2016/04/10 NEXT GENERATION CONSULTANTS 41
Reference: International Finance Corporation – Stakeholder Engagement – A good practice Handbook for companies doing business in emerging markets
OTHER STAKEHOLDER ENGAGEMENT
TOOLS & RESOURCES
From Words to Action:
The Stakeholder Engagement Manual – Volume 1 – The guide to practitioners perspectives on stakeholder
engagement www.uneptie.org
Volume 2 – The practitioners handbook on stakeholder engagement www.uneptie.org;
www.accountability.org.uk, www.stakeholderresearch.com
Stakeholder Engagement – Practitioners Handbook -stakeholder.engagement@immi.gov.au
Proactive Stakeholder Engagement – A Practical Guideline for Companies and Stakeholders –
The European Alliance for CSR
BSR: A tool for stakeholder mapping – www.bsr.org
2016/04/10 NEXT GENERATION CONSULTANTS 42
WHAT HAPPENS AFTER THE
ENGAGEMENT?
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AFTER THE ENGAGEMENT
Follow-through is important to any relationship and this certainly applies to relationships with
stakeholders. Whether or not a company is able to implement what it has learned from
stakeholders, there is an obligation to report back, to make it clear that stakeholder
concerns and interests were heard, considered, and valued.
Companies have a responsibility to respond to stakeholders about concerns shared, to explain
how or whether concerns or suggestions are being addressed.
In addition to responding to issues raised by stakeholders, companies should keep track of
any promises or commitments they have made to stakeholders. Just as a company would
hold themselves accountable for promising earnings growth to shareowners, commitments to
community members or environmental groups/experts (or any other stakeholders). For an
engagement process to be considered credible companies need to implement/respond to the
reasonable expectations of stakeholders.
Information reported to stakeholders should be translated into local languages and in easily
understood formats, and any material changes to commitments or implementation actions
should be communicated very clearly and regularly.
2016/04/10 NEXT GENERATION CONSULTANTS 44
STAKEHOLDER MANAGEMENT PLAN - CONTENT
•Scope (background, logic, impact)
•Define ownership and process (accountability & methodology)
•Define governance process (i.e. assurance)
•Identify and define key stakeholder groups (prioritisation)
•Describe the engagement plan, methodology, frequency & channels
•Identify legitimate concerns and interests of stakeholders
•Identify and describe possible conflict management in engagement processes
•Define and describe feedback mechanisms of engagement process to ensure alignment and
integration with strategies and operations
•Detail stakeholder feedback – responses and commitments
•Generate reports, actions, activities and priorities – including for sustainability and integrated
reports
2016/04/10 NEXT GENERATION CONSULTANTS 45
DO’S AND DON’TS OF STAKEHOLDER RELATIONS
Do seek stakeholder partners with real credibility and strong credentials, whose independence
and integrity are unquestioned in the stakeholder communities you are trying to reach.
Do give the stakeholder organisations you engage or work with genuine independence,
allowing them to set up their own processes and procedures and giving them the opportunity to
communicate with the outside world freely and without censorship.
Do involve your own key leaders who are in a position to make and keep commitments on behalf
of the company.
Don’t create “Astroturf” organisations — phony stakeholder groups that masquerades as an
independent stakeholders while secretly serving your own corporate interests.
Do be up-front about your role in helping create and, if necessary, fund a stakeholder group; if
the connection is exposed against your wishes due to investigative work by the media, it will
seriously damage both your credibility and that of any stakeholders involved.
Don’t renege on any commitments you make; the damage to your company’s reputation will be
doubly serious if you first boast about, then try to eliminate, any moves toward dialogue and
partnership with outside stakeholders.
2016/04/10 NEXT GENERATION CONSULTANTS 46
IN SUMMARY
Stakeholder engagement has tremendous value across the business
Stakeholder engagement is best understood if the whole business is involved
Stakeholder engagement is better supported if managed in relation to other communication
activities
Don’t lump stakeholders in homogenous groups
Don’t make assumptions about the specific risks/issues that will be discussed
Don’t pre-empt the process by linking indicators or KPI’s too soon
Be flexible and allow stakeholders to dominate discussion
Remember it requires commitment to feedback the outcome and result to the stakeholders after
the event
Less is more!
2016/04/10 NEXT GENERATION CONSULTANTS 47
THANK YOU
Reana Rossouw - Next Generation Consultants
Next Generation Consultants are internationally recognized
and have published extensively and spoken at local and
international conferences. Copies of these articles, research
papers, presentations, whitepapers and awards are
available on:
Website: www.nextgeneration.co.za
Linkedin: https://www.linkedin.com/company/next-
generation-consultants
Google+: https://plus.google.com/+reana rossouw
Pinterest: https://www.pinterest.com/reanarossouw/
Facebook: https://www.facebook.com/
nextgenerationconsultants/
Slideshare: http://www.slideshare.net/Reana1
Please Note:
The material is this presentation is
copyrighted
Permission must be obtained for using
this material – in totality or in part
2016/04/10 NEXT GENERATION CONSULTANTS 48

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Community engagement 101

  • 1. COMMUNITY ENGAGEMENT 101 A CASE STUDY FOR BEST PRACTICE Reana Rossouw Next Generation Consultants
  • 2. QUESTION? What is the difference between general stakeholder engagement and community engagement? 2016/04/10 NEXT GENERATION CONSULTANTS 2
  • 3. STAKEHOLDER ENGAGEMENT IS …. Stakeholder engagement can be described as an organisation’s efforts to understand and involve stakeholders and their concerns in its activities and decision-making processes. The purpose of stakeholder engagement is to drive strategic direction and operational excellence for an organisation. Done correctly, engaging stakeholders can result in learning, innovation, and enhanced performance that will not only benefit the organisation, but also its stakeholders and society as a whole. In addition to serving as a key tool to support a company’s sustainability reporting efforts, stakeholder engagement can be seen as a foundation that supports an organisation’s broader sustainability efforts to set strategic goals, implement action plans, and assess its performance over time. 2016/04/10 NEXT GENERATION CONSULTANTS 3
  • 4. QUESTION? Why conduct stakeholder engagement? 2016/04/10 NEXT GENERATION CONSULTANTS 4
  • 5. VALUE OF STAKEHOLDER ENGAGEMENT (1) Anticipate and manage emerging issues A mechanism to improve an understanding of stakeholder priorities and to respond to emerging stakeholder concerns To identify, evaluate, address and improve sustainability performance issues before they become threats or lost opportunities Helps ensure that a company can consistently convey complete, comparable, inclusive, responsive and accurate information to the outside world Promote productive collaboration with stakeholders Creates an information sharing platform whereby organisations can disclose specific information i.e. performance, practices, strategies and goals to stakeholders (to enable them to make informed decisions) Serves as an opportunity for stakeholders to identify impact/risk areas about which they have a concern Creates opportunities to discuss priority issues together with stakeholders thereby building trust and collaboration via dialogue Allows for increased, shared understanding of the company’s impacts, improvements and challenges, whereby organisations and stakeholders can build consensus to find solutions and set goals to address challenges To reduce/mitigate negative reactions to future, unforeseen incidents and/or impacts because of better understanding and communication 2016/04/10 NEXT GENERATION CONSULTANTS 5
  • 6. VALUE OF STAKEHOLDER ENGAGEMENT (2) Improve decision-making and operational performance Allows a company to align its management plans and actions with the expectations, needs and demands of key stakeholders Helps streamline responses to various information requests, and thereby potentially reduce reporting redundancies and time burdens Enables companies to maximize opportunities for improving resource management and risk management by tracking performance over time Helps engage and motivate staff who are responsible for various aspects of performance Leverages performance improvements as the organisation works to follow through on agreed commitments 2016/04/10 NEXT GENERATION CONSULTANTS 6
  • 7. CORE VALUES FOR THE PRACTICE OF STAKEHOLDER ENGAGEMENT Stakeholders should have a say in decisions about actions that could affect their lives or an essential environment for life (good quality of life) Stakeholder participation includes the promise/commitment that stakeholder’s contribution will influence management/operational decisions Stakeholder participation promotes sustainability decisions by recognizing and observing the needs and interests of all participants Effective stakeholder engagement: Ensures participants are equipped to engage Ensures participation from the start (designing engagement) to the end (communicating and reporting on the outcomes of the engagement Ensures agreement on input decision-making (how input will be utilised) 2016/04/10 NEXT GENERATION CONSULTANTS 7
  • 8. QUESTION? How is stakeholder engagement different to any other form of communication? 2016/04/10 NEXT GENERATION CONSULTANTS 8
  • 9. IN THE BEGINNING Before any expensive and lengthy engagement process can begin, it is important to have a good understanding, and indeed consider what level of participation is actually being sought. Public participation can be broadly categorised into the following: 2016/04/10 NEXT GENERATION CONSULTANTS 9 Levels of public participation goals Inform To provide the public with balanced and objective information to assist them in understanding the problem, alternatives, opportunities, and/or solutions Consult To obtain public feedback for decision-makers on analysis, alternatives and/or decisions Involve To work directly with the public throughout the process to ensure that public concerns and aspirations are consistently understood and considered in decision-making processes Collaborate To partner with the public in each aspect of the decision making process including the development of alternatives and the identification of the preferred solution Empower To place final decision-making in the hands of the public
  • 10. WHY IS STAKEHOLDER ENGAGEMENT SO DIFFICULT? Stakeholder management is difficult because it involves different people with different expectations and different information needs. Engaging stakeholders for collaboration involves constant vigilance in a constantly changing landscape of relationships with stakeholders whose support, interests and influence fluctuates unpredictably. Why is stakeholder engagement so expensive? 2016/04/10 NEXT GENERATION CONSULTANTS 10
  • 11. STAKEHOLDER ENGAGEMENT 101 Engagement is but one form of stakeholder relations along a spectrum of possible interactions that also include activities like message delivery, media outreach, deal negotiations, lobbying, coalition development, advocacy, damage control, research surveys, focus groups, issue management and benchmarking. Stakeholder engagement is when the company initiates open, two-way dialogue seeking understanding and solutions to issues of mutual concern. It involves discovering and may result in implementing ideas that benefit both stakeholders and the company. This is not the same thing as opinion research, message delivery, lobbying, constituency relations or grant making or sales or wage negotiations. 2016/04/10 NEXT GENERATION CONSULTANTS 11
  • 12. DIFFERENTIATION IN ENGAGEMENT 2016/04/10 NEXT GENERATION CONSULTANTS 12
  • 13. BUILDING BLOCKS OF STAKEHOLDER ENGAGEMENT Stakeholder engagement is an umbrella term encompassing a range of activities and interactions: Stakeholder identification and analysis Information disclosure Stakeholder consultation Negotiation and partnerships Grievance management Reporting to stakeholders Management, governance, compliance, risk management functions Stakeholder involvement in project/process monitoring 2016/04/10 NEXT GENERATION CONSULTANTS 13
  • 14. DEFINITIONS WITHIN THE CONTEXT Communication: Any manner of information sharing with stakeholders, generally through one-way, non-iterative processes Consultation: The process of gathering information or advice from stakeholders and taking those views into consideration to amend plans, make decisions or set directions Dialogue: An exchange of views and opinion to explore different perspectives, needs and alternatives, with a view to fostering mutual understanding, trust and cooperation on a strategy or initiative Engagement: An organisation’s efforts to understand and involve stakeholders and their concerns in its activities and decision-making processes 2016/04/10 NEXT GENERATION CONSULTANTS 14 Reference: Stakeholder Engagement Manual – Page 6, UNEP, Volume 1 – www.stakeholderresearch.com
  • 15. SPECTRUM OF ENGAGEMENT 2016/04/10 NEXT GENERATION CONSULTANTS 15
  • 16. ONE SIDED INSTRUMENTS •Customer Satisfaction •Supplier Surveys •Employee Surveys •Stakeholder Opinion Surveys •Self Assessments •Stakeholder Perceptions •Balance Scorecards •360 Degree Frameworks 2016/04/10 NEXT GENERATION CONSULTANTS 16 Investor Relations Customer Relations Human Relations Media Relations Industrial Relations Public Relations
  • 17. STAKEHOLDER MANAGEMENT PROCESS Context • Objectives, approach, expectations • Identify relationships (issues & risks) • Stakeholder identification & prioritisation • Buy in & support both parties Data • Sampling – how many • Methodology of communication • F2F, telephone, etc. • Questionnaire Analysis • Interpret Data • Link to business objectives & outcomes • Discuss results of engagement - collectively • Report results of engagement Report • Highlight strengths and weaknesses • Highlight areas of impact • Highlight areas of risk • Highlight areas of differences/ similarities • Recommendations – Stakeholder Management Plan 2016/04/10 NEXT GENERATION CONSULTANTS 17
  • 18. QUESTION? Who are stakeholders? How are stakeholders categorised? How are stakeholders prioritised? 2016/04/10 NEXT GENERATION CONSULTANTS 18
  • 19. WHAT ARE STAKEHOLDERS? By definition, stakeholders have a stake in the company/the issue, or who may experience losses or be harmed as a result of the operations of a company A person, group, or organisation that has direct or indirect stake in an organisation because it can affect or be affected by the organisation's actions, objectives, and policies. Although ‘stakeholding’ is usually self- legitimising (those who judge themselves to be stakeholders are a stakeholder), all stakeholders are not equal and different stakeholders are entitled to different considerations. 2016/04/10 NEXT GENERATION CONSULTANTS 19
  • 20. WHO ARE STAKEHOLDERS? A stakeholder can be defined as any person, or group, who has an interest/stake in a project/process or strategy or could be potentially affected by its delivery or outputs. Stakeholders is often categorised into ‘groups’ based on a number of factors including: Geographic boundaries or location Recognised bodies or institutions Income groups Land ownership or occupation Legal requirements Real or perceived views of the issue under dispute The nature of stakeholder classification means that stakeholder groups are usually not homogenous entities. It is more likely in fact, that an identified stakeholder group will comprise a diverse mix of individuals, who may – or may not – identify themselves with the particular “stakeholder group” into which they have been categorised. 2016/04/10 NEXT GENERATION CONSULTANTS 20
  • 21. IDENTIFYING COMMUNITY STAKEHOLDERS General Company Stakeholders Customers Employees Media Suppliers Government Communities Specific community stakeholders Program Implementers - Intermediaries Co-Funding Partners Program Influencers – Government Direct Program Beneficiaries Indirect Program Beneficiaries 2016/04/10 NEXT GENERATION CONSULTANTS 21
  • 22. ANALYSING AND PRIORITISING STAKEHOLDERS Community Stakeholder Groups Program Approvals • Local Wards • Traditional Councils • School Principles/Councils Program Approvals • Government Departments • National/Provincial/Local Program Influencers – Program Design • Co-Funders Program Influencers – Program Implementation • NGO’s Program Beneficiaries – Direct/Indirect Let’s Test It: Program Funding: Education Sport Health Disaster Relief Funder(s) Media Local Interest Groups (Cleaner Air/Tax Payers/Media/ 2016/04/10 NEXT GENERATION CONSULTANTS 22 Let’s Test It: Program M&E/Reporting:
  • 23. ANALYSING STAKEHOLDERS Segmentation Primary Secondary Tertiary Others Cause Related Programs Donation/Sponsorship Comparative/Competitive Geographic spread Sample Sizes Depends on Available Data Age of Data Budget Resources Engagement Methodology(ies) 2016/04/10 NEXT GENERATION CONSULTANTS 23 Prioritising / Sample Sizes Determining the boundaries/objectives and outcomes of community engagement
  • 24. IDENTIFYING STAKEHOLDERS Primary stakeholders are those stakeholders that have a direct stake in the organisation and its success Secondary stakeholders are those that have a public or special interest in the organisation Core stakeholders are essential to the survival of the business/program Strategic stakeholders are vital to the organisation and/or the threats and opportunities the organisation faces (current or future) Environmental stakeholders are all others in the organisation's environment Legitimacy refers to the perceived validity of the stakeholder’s claim to a stake Power refers to the ability or capacity of a stakeholder to produce/influence an effect/risk Urgency refers to the degree to which the stakeholder’s claim demands immediate attention 2016/04/10 NEXT GENERATION CONSULTANTS 24
  • 25. OTHER CONSIDERATIONS (1) Who decides who is involved As the selection of participants can be a politically charged responsibility, the selection process must be as transparent as possible. It is wise to ensure that the reasons for selection are noted/documented so that any questions about selection/prioritisation can be answered. Resist pressure on numbers There is often internal and external pressure to expand or reduce the list of those involved. The number of people involved should not be arbitrary but based on a coherent understanding of the purpose and the context of the engagement process. Marginalising “Usual suspects” Organisations sometimes try to avoid involving the “usual suspects”, which has become a term of denigration for people who habitually give time and effort to what they see as their civic responsibilities. Describing someone as a ‘usual suspect’ should never be grounds to exclude them from a process any more than it is grounds for including them: people should be involved because they are the right people. Opponents It is equally wrong to exclude an individual or an organisation for being a known opponent of a given purpose or process. There are often good reasons for keeping opponents “inside the tent”: these can be the people who most need to be involved so that they gain some ownership of the process and perhaps become more likely to support the final outcome (or at least, less inclined to undermine it as they might have, had they been excluded). 2016/04/10 NEXT GENERATION CONSULTANTS 25
  • 26. OTHER CONSIDERATIONS (2) Hard to Reach Groups It is important to try to include all relevant stakeholders, and those who often get omitted are the hard to reach groups. Extra effort and innovation will be needed to contact and engage with these groups or individuals, who do not generally come forward by their own volition. Including these minority or “hard to reach” groups is important to obtaining a more balanced picture from the engagement process. Everyone does not have to be involved in everything With good planning, and the agreement of participants, different people can be involved only in those parts of the process which are most relevant to them. Campaigning organisations Many campaigning bodies, especially national civil society organisations, are constantly asked to be involved in participatory exercises, and do not always see these as the most effective use of their limited resources. In addition, some see the compromise that can be inherent in some participatory processes as conflicting with their primary purposes. It can be useful to consider (and discuss with them) at which stage of the policy process NGOs are best suited to participate: agenda setting, policy development, policy implementation or policy review. What’s In It for Them (WIIFT)? It is important to consider and discuss with participants what they want to get out of the process and what could prevent them from participating. If everyone’s motivations can be clarified at the start, there will be less confusion and everyone is more likely to be satisfied with the outcomes. This is especially important in an area that is suffering from consultation/engagement fatigue. 2016/04/10 NEXT GENERATION CONSULTANTS 26
  • 27. IDENTIFYING STAKEHOLDERS Be systematic Consider all aspects of the company’s area of influence, e.g. technical, business, geographical etc. Remember the interest groups Identify those groups or organisations that are not directly impacted by the company e.g. but whose interests determine them as stakeholders e.g. Security personnel or unions, media, etc. Use past stakeholder information Referring to previous similar projects can save time and highlight stakeholders risks, liabilities, or unresolved issues that can then be included in the analysis. Consider the entire project lifecycle/company stage (growth/startup/mature) It is important to remember that both stakeholders and their interests may change as the company evolves and progresses. Consider all stages of the company life cycle (prospecting, start-up, growing, operational, closing) when drawing up the stakeholder list and review it regularly as the stakeholder process matures. People matter Although stakeholders may be both organisations and people, ultimately you can only communicate with individual people. Make sure that you identify the correct individual stakeholders within each stakeholder group. Remember people are mobile and therefore stakeholders change all the time. 2016/04/10 NEXT GENERATION CONSULTANTS 27
  • 28. QUESTION? How to engage? What would constitute engagement? 2016/04/10 NEXT GENERATION CONSULTANTS 28
  • 29. STAKEHOLDER ENGAGEMENT TOOLS (1) 2016/04/10 NEXT GENERATION CONSULTANTS 29 Technique Most appropriate application Main advantages and disadvantages Personal Interviews • Identify issues specific to each stakeholder • Provide opportunities for stakeholders to speak confidentially • Build relationships with individual stakeholders Advantages: • Demonstrates commitment on part of the company • Provides an opportunity to build relationships • Provides detailed data through two-way communication Disadvantages: • Time and resource intensive • No opportunity to test attitudes and assertions independently • Individuals may not necessarily be representative of a stakeholder group as a whole Workshops • Form relationships with and between high level stakeholders and experts • Involve stakeholders in thinking through issues, to develop a strategic approach or resolve an issue/s • Communicate aspects of stakeholder engagement process or issues management to stakeholders and employees • Analyze impacts • Prioritize/rank issues and potential solutions Advantages: • Demonstrates commitment on part of the company • Provides an opportunity to build a network of relationships • Allows issues to be verified, tested and solutions developed • Increases ownership by participants Disadvantages: • Participation is limited to a relatively small number of stakeholders • Individuals may not necessarily be representative of a stakeholder group as a whole • Need to provide sufficient information beforehand such that participants can provide informed views/opinions/solutions
  • 30. STAKEHOLDER ENGAGEMENT TOOLS (2)Technique Most appropriate application Main advantages and disadvantages Focus Groups / Forums • Identify stakeholder views on a specific issue • Discuss the views of a common interest stakeholder group • Gather baseline data • Support, pilot, test or gain feedback on the outputs of other methods (e.g. surveys, interviews) • Determine stakeholder responses/views/opinions to proposed mitigation / risk based strategies • Monitor and evaluate social/environmental or economic performance of an organisation/operation Advantages: • Demonstrates commitment on part of the company • Provides an opportunity to build a network of relationships • Allows issues to be verified, tested and solutions developed collectively • Increases ownership by participants Disadvantages: • Participation is limited to relatively small number of stakeholders • Individuals may not necessarily be representative of a stakeholder group or community as a whole • Need to provide sufficient (sometimes sensitive) information such that participants can provide informed views/opinions/input Public or ‘Town Hall” meeting • Reach large audiences in particular communities quickly • Present information and seek feedback from stakeholders instantaneously • Ensure that everyone gets a change to provide comment / criticism / feedback Advantages: • Relatively inexpensive and quick • Allows reach of a large number of people simultaneously • Demonstrate willingness to be open to public criticism • Provides communities with opportunity to speak directly to company representatives Disadvantages: • There is a risk that vocal but unrepresentative groups may ‘hijack’ the meeting • Some communities or groups within them, may not be comfortable speaking in such a public forum • Limited opportunity to explore issues of particular stakeholders in detail • Can be difficult to facilitate if the issue(s) under discussion is/are controversial or highly emotive 2016/04/10 NEXT GENERATION CONSULTANTS 30
  • 31. STAKEHOLDER ENGAGEMENT TOOLS (3) Technique Most appropriate application Main advantages and disadvantages Surveys • Identify stakeholder issues and assess community needs • Obtain an objective overview of a group of stakeholders to a particular issue or potential impact • Develop mitigation / risk-based strategies • Gather data for evaluation or reporting quickly • Monitor and compare data/ impacts and performance using repeat surveys Advantages: • Provides detail data on specific issues • Assuming an appropriate sample is gathered, provides a good insight to the extend of an issue/s or significance of an issue within a community • Widely known and acceptable methodology Disadvantages: • Written surveys are not appropriate in an environment where literacy levels/technology access are low • Can be easily manipulated or designed to yield particular results • Depending on the response method, surveys generally yield poor/low response rates • Surveys take considerable time and resources to prepare, implement and analyze results 2016/04/10 NEXT GENERATION CONSULTANTS 31
  • 32. STAKEHOLDER ENGAGEMENT TOOLS (4)Technique Most appropriate application Main advantages and disadvantages Participatory Tools • Scope and identify community needs / aspirations • Involve stakeholders in the development of engagement tools • Monitor and evaluate social/human rights/ environmental impacts and performance over time per aspect Advantages: • Demonstrates commitment on part of the company • Provides the opportunity to build relationships and stakeholder ownership of outcomes • Can gain in-depth understanding of stakeholder cultures, beliefs, assets and interactions Disadvantages • Need to manage conflicting community demands • Can result in unrealistic community expectations • Process can be dominated by well articulated and organised stakeholder groups Stakeholder Panels • Provide detailed, expert, specific input into strategies • Give expert guidance on company direction, development of new products / services • Share industry/context specific information, developments, progress Advantages: • Examines specific aspects of corporate policy, action or performance • Produce comments or recommendations upon which the company may or may not make specific commitments • Assists company in receiving advice, gauge expectations and criticism • May anticipate possible threats to activities/issues that may arise in future Disadvantages • May not be representative • May not have expertise in specific subject/or in issues 2016/04/10 NEXT GENERATION CONSULTANTS 32
  • 33. ENGAGEMENT STANDARDS, FRAMEWORKS AND GUIDELINES 2016/04/10 NEXT GENERATION CONSULTANTS 33
  • 34. GRI REPORTING REQUIREMENTSDefinition: The reporting organisation should identify its stakeholders and explain in the report how it has responded to their reasonable expectations and interests. The reasonable expectations and interests of stakeholders are a key reference point for many decisions in the preparation of a sustainability report, such as the scope, boundary, application of indicators, and assurance approach. Stakeholder engagement processes can serve as tools for understanding the reasonable expectations and interests of stakeholders. For a report to be assurable, the process of stakeholder engagement should be documented and they should be based on systematic or generally accepted approaches, methodologies or principles. The reporting organisation should: Document its approach for defining which stakeholders it engaged with, how and when it engaged with them, and how engagement has influenced the report content and the organisation’s sustainability activities (strategies and reports). Tests: The organisation can describe the stakeholders to whom it considers itself accountable. The report draws on upon the outcomes of stakeholder engagement processes used by the organisation and as required by legal and institutional frameworks in which it operates. The report content draws upon the outcomes of any stakeholder engagement processes undertaken specifically for the report. The stakeholder engagement processes that inform decisions about the report content are consistent with the scope and boundary of the report. 2016/04/10 NEXT GENERATION CONSULTANTS 34
  • 35. KING III AND STAKEHOLDER INCLUSIVENESS The Board should: Appreciate that stakeholders’ perceptions affect a company’s reputation Identify important stakeholder groupings Delegate to management to proactively deal with stakeholder relationships Disclose in its integrated report the nature of the company’s dealings with stakeholders and the outcomes of these dealings Strive to achieve the appropriate balance between its various stakeholder groupings, in the best interests of the company Take account of the legitimate interests and expectations of its stakeholders in its decision-making in the best interests of the company Adopt communication guidelines that support a responsible communication programme 2016/04/10 NEXT GENERATION CONSULTANTS 3535 Reference: King III – www.IOD.co.za
  • 36. KING III - STAKEHOLDER ENGAGEMENT GOVERNANCE Board roles and responsibilities Define stakeholder engagement as a core value Identify, discuss and prioritize key risks associated with changing societal expectations Determine the stakeholders financial and non-financial information needs for decision- making, management oversight, and monitoring key stakeholder relationships associated with generating value and wealth Discuss and approve key performance indicators for social, environmental, and financial performance Approve a policy for external reporting Integrate stakeholder issues into annual general meetings of shareowners Discuss the risks and impacts of projects and operations and provide transparent disclosure information to shareowners and other key stakeholder groups Convene stakeholder forums and invite key stakeholder representatives to address board meetings 2016/04/10 NEXT GENERATION CONSULTANTS 36
  • 37. THE COMPANIES ACT AND STAKEHOLDERS (1) Social and Ethics Committee Companies Act, Number 71 of 2008 became effective 1 May 2011 Sought to modernise and ‘simplify’ company law Many changes to regulatory, accountability, transparency and governance requirements Section 72 (4) and Regulation 43 (2) requires a Social and Ethics Committee for applicable companies Reasons – Stakeholder governance model in SA (not just about shareholders – refer also King III) To monitor the company’s activities, having regard to relevant legislation, to other legal requirements, or prevailing codes of best practice. To draw matters within its mandate to the attention of the board and to report to shareholders at the AGM Scope of matters Social and economic development Good corporate citizenship The environment, health and public safety Consumer relationships Labour and employment 2016/04/10 NEXT GENERATION CONSULTANTS 3737 Reference: Companies Act No. 71 of 2008
  • 38. COMPANIES ACT (2) The Regulations prescribe that a Social and Ethics Committee has the following functions: 1) To monitor the company’s activities, having regard to any relevant legislation, other legal requirements or prevailing codes of best practice, with regard to matters relating to: Social and economic development, including the company’s standing in terms of the goals and purposes of- The 10 principles set out in the United Global Compact Principles; The OECD recommendations regarding corruption; The Employment Equity Act; and The Broad-Based Black Economic Empowerment Act; Good corporate citizenship, including the company’s- Promotion of equality, prevention of unfair discrimination, and reduction of corruption; Contribution to development of the communities in which its activities are predominantly conducted or within which its products or services are predominantly marketed; and Record of sponsorship, donations and charitable giving; The environment, health and public safety, including the impact of the company’s activities and of its products or services; Consumer relationships, including the company’s advertising, public relations and compliance with consumer protection laws; and Labour and employment, including- The company’s standing in terms of the International Labour Organisation Protocol on decent work and working conditions; and The company’s employment relationships, and its contribution toward the educational development of its employees; 2) To draw matters within its mandate to the attention of the Board as occasion requires; and 3) To report, through one of its members, to the shareholders of the company’s annual general meeting on the matters within its mandate.2016/04/10 NEXT GENERATION CONSULTANTS 38
  • 39. INTEGRATED REPORTING AND STAKEHOLDERS - IIRC An Integrated Report should provide insight into the nature and quality of the organisation’s relationships with its key stakeholders, including how and to what extent the organisation understands, takes into account and responds to their legitimate needs and interests. Stakeholders provide useful insights about matters that are important to them, including economic, environmental and social issues that also affect the ability of the organisation to create value. Understand how stakeholders perceive value Identify trends that might not have come to the general attention, but which are rising in significance Identify material matters, including risks and opportunities Develop and evaluate strategy Manage risks Implement activities, including strategic and accountable responses to material matters 2016/04/10 NEXT GENERATION CONSULTANTS 39
  • 40. STAKEHOLDER ENGAGEMENT STANDARD: ACCOUNTABILITY AA1000SES Definitions: Stakeholder Inclusivity is the participation of stakeholders in developing and achieving an accountable and strategic response to sustainability Stakeholder Engagement is a tool that organisations use to help them achieve inclusivity Companies using AA1000SES must: Commit publicly that they used the Standard and that they will follow the principles of materiality, inclusiveness and responsiveness Integrate stakeholder engagement into governance and decision-making (strategy and operational) processes Define the purpose and scope of engagement Have a process for stakeholder engagement Have a stakeholder engagement plan/strategy Profile/map of stakeholders Determine the engagement level and methods Establish and communicate boundaries of disclosure Establish indicators to measure the quality of stakeholder engagement Document the engagement and outputs Develop an action plan 2016/04/10 NEXT GENERATION CONSULTANTS 40 Reference: AccountAbility Stakeholder Engagement Standard (AA1000SES) 2011 – www.accountability.co.uk
  • 41. IFC STAKEHOLDER ENGAGEMENT Handbook provides guidance on stakeholder engagement specifically for: Mining/extractive industries on stakeholder engagement processes as it pertains to: ESIA – Environmental, Social Impact Assessments Mine Closure, Site Selection and Construction, Social and Labour Plans, Industry Specific Guidelines – i.e. ICMM Financial and Development Institutions Equator Principles – Responsible Lending Service Industries Perception Surveys, Grievance processes and mechanisms 2016/04/10 NEXT GENERATION CONSULTANTS 41 Reference: International Finance Corporation – Stakeholder Engagement – A good practice Handbook for companies doing business in emerging markets
  • 42. OTHER STAKEHOLDER ENGAGEMENT TOOLS & RESOURCES From Words to Action: The Stakeholder Engagement Manual – Volume 1 – The guide to practitioners perspectives on stakeholder engagement www.uneptie.org Volume 2 – The practitioners handbook on stakeholder engagement www.uneptie.org; www.accountability.org.uk, www.stakeholderresearch.com Stakeholder Engagement – Practitioners Handbook -stakeholder.engagement@immi.gov.au Proactive Stakeholder Engagement – A Practical Guideline for Companies and Stakeholders – The European Alliance for CSR BSR: A tool for stakeholder mapping – www.bsr.org 2016/04/10 NEXT GENERATION CONSULTANTS 42
  • 43. WHAT HAPPENS AFTER THE ENGAGEMENT? 2016/04/10 NEXT GENERATION CONSULTANTS 43
  • 44. AFTER THE ENGAGEMENT Follow-through is important to any relationship and this certainly applies to relationships with stakeholders. Whether or not a company is able to implement what it has learned from stakeholders, there is an obligation to report back, to make it clear that stakeholder concerns and interests were heard, considered, and valued. Companies have a responsibility to respond to stakeholders about concerns shared, to explain how or whether concerns or suggestions are being addressed. In addition to responding to issues raised by stakeholders, companies should keep track of any promises or commitments they have made to stakeholders. Just as a company would hold themselves accountable for promising earnings growth to shareowners, commitments to community members or environmental groups/experts (or any other stakeholders). For an engagement process to be considered credible companies need to implement/respond to the reasonable expectations of stakeholders. Information reported to stakeholders should be translated into local languages and in easily understood formats, and any material changes to commitments or implementation actions should be communicated very clearly and regularly. 2016/04/10 NEXT GENERATION CONSULTANTS 44
  • 45. STAKEHOLDER MANAGEMENT PLAN - CONTENT •Scope (background, logic, impact) •Define ownership and process (accountability & methodology) •Define governance process (i.e. assurance) •Identify and define key stakeholder groups (prioritisation) •Describe the engagement plan, methodology, frequency & channels •Identify legitimate concerns and interests of stakeholders •Identify and describe possible conflict management in engagement processes •Define and describe feedback mechanisms of engagement process to ensure alignment and integration with strategies and operations •Detail stakeholder feedback – responses and commitments •Generate reports, actions, activities and priorities – including for sustainability and integrated reports 2016/04/10 NEXT GENERATION CONSULTANTS 45
  • 46. DO’S AND DON’TS OF STAKEHOLDER RELATIONS Do seek stakeholder partners with real credibility and strong credentials, whose independence and integrity are unquestioned in the stakeholder communities you are trying to reach. Do give the stakeholder organisations you engage or work with genuine independence, allowing them to set up their own processes and procedures and giving them the opportunity to communicate with the outside world freely and without censorship. Do involve your own key leaders who are in a position to make and keep commitments on behalf of the company. Don’t create “Astroturf” organisations — phony stakeholder groups that masquerades as an independent stakeholders while secretly serving your own corporate interests. Do be up-front about your role in helping create and, if necessary, fund a stakeholder group; if the connection is exposed against your wishes due to investigative work by the media, it will seriously damage both your credibility and that of any stakeholders involved. Don’t renege on any commitments you make; the damage to your company’s reputation will be doubly serious if you first boast about, then try to eliminate, any moves toward dialogue and partnership with outside stakeholders. 2016/04/10 NEXT GENERATION CONSULTANTS 46
  • 47. IN SUMMARY Stakeholder engagement has tremendous value across the business Stakeholder engagement is best understood if the whole business is involved Stakeholder engagement is better supported if managed in relation to other communication activities Don’t lump stakeholders in homogenous groups Don’t make assumptions about the specific risks/issues that will be discussed Don’t pre-empt the process by linking indicators or KPI’s too soon Be flexible and allow stakeholders to dominate discussion Remember it requires commitment to feedback the outcome and result to the stakeholders after the event Less is more! 2016/04/10 NEXT GENERATION CONSULTANTS 47
  • 48. THANK YOU Reana Rossouw - Next Generation Consultants Next Generation Consultants are internationally recognized and have published extensively and spoken at local and international conferences. Copies of these articles, research papers, presentations, whitepapers and awards are available on: Website: www.nextgeneration.co.za Linkedin: https://www.linkedin.com/company/next- generation-consultants Google+: https://plus.google.com/+reana rossouw Pinterest: https://www.pinterest.com/reanarossouw/ Facebook: https://www.facebook.com/ nextgenerationconsultants/ Slideshare: http://www.slideshare.net/Reana1 Please Note: The material is this presentation is copyrighted Permission must be obtained for using this material – in totality or in part 2016/04/10 NEXT GENERATION CONSULTANTS 48