Recent seminar paper delivered at the Oxford University Centre for Corporate Reputation. Synopsis: Reputations only exist within a network. As such network identification, monitoring and engagement is key. Networks are increasingly complex spanning governments, NGOs, media, online, key opinion leaders, academics and many other diverse groups. These networks and the key opinion leaders within each comprise the critical stakeholders of a company. Good stakeholder management is a key driver of value protection and value creation. This is particularly relevant in the context of today’s negative business environment yet many companies fail to do so successfully. This paper outlines some of the new models, technologies and solutions available today.

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
terence@thestakeholdercompany.com
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
terence@thestakeholdercompany.com
www.thestakeholdercompany.com