BACKGROUND
Before planning a stakeholder engagement process it is essential to know where
you already are on the material issues in question:
• How is the issue currently managed within your organisation?
• What policies and systems do you already have in place?
• What is it that you can and want to do about these issues?
This information provides the practical basis for building more robust and
responsive stakeholder engagement processes, but also the basis on which to
assess your current practice against your objectives and against the level of
maturity of the issues in question.
An organisation’s stakeholder engagement practice in relation to an individual
issue can be characterised within the following fi ve stages of development
(see below) .5
No Engagement No engagement on an issue
Exploratory
Developing
Embedded
Strategic
Organisational Learning Stages
Ad-hoc engagement with stakeholders when opportunities or challenges arise: focused
on learning and exploring the issue and often dependent on individual commitment.
Good quality engagement processes with some thought to design and stakeholder
needs, but management systems are patchy, the impact of engagements to actual
operational decision making is unclear, and there are no clearly established
performance objectives addressing the issue.
High quality engagement processes feed into operational decision making and are
embedded in core management processes. Engagement is systematised to ensure that
the issue is adequately addressed.
High quality engagement embedded in management and governance processes and
linked to business strategy. Issues are addressed in-depth, often with the objective of
systemic change and on a global and local level.
These organisational responses can then be compared to the maturity of an
issue, which you have already assessed in Stage 1. Th is is the purpose of the Issue
Response Matrix opposite:
5 This model aligns with the value creation model presented in “Volume 1. The Guide to Practitioners’ Perspectives”, on p.27.
P5: REVIEWING YOUR PROGRESS
STAGE 2
LATENT EMERGING CONSOLIDATING INSTITUTIONALISED
STRATEGIC
EMBEDDED
DEVELOPING
EXPLORATORY
Organisational
Response
Social Maturity of an Issue
Higher
Opportunity Green
Zone
Risky Red Zone
The issue response matrix guides you in comparing your company’s way of
dealing with an issue with the maturity of debate about it within society more
broadly. It thereby helps you to identify where you are in a leadership position
and where you are at risk. On the other hand, it also helps you to identify where
you might want to be in relation to an issue under consideration.
C
B
A
Example Application for the Issue Response Matrix: Child Labour in the Supply Chain
There is widespread consensus amongst citizens, consumers, business and governments that children should not be forced to work long
hours in jobs that sacrifi ce their health, safety and education. 141 countries have ratifi ed the ILO Minimum Age Convention and 153 have
ratifi ed the ILO Worst Forms of Child Labour Convention. Most of these countries have legislation on their statute books aimed at ending
child labour and many have programmes to combat child labour often with technical or fi nancial support from the ILO or international
donors. A number of industry associations, NGOs and multi-sector initiatives are also working to address the issue, voluntary guidance for
buyers have been developed, and many businesses are working to improve the management and monitoring systems which help avoid
child labour within their supply chains. It can be considered a consolidated issue.
Yet the ILO estimates that 1 in 6 children is at work instead of at school and three-quarters of these are involved in hazardous work.
Amongst companies whose operations and sourcing networks extend into countries and sectors where child labour is endemic, different
levels of response can be seen.
• The business which is still developing its basic policies, where any information it gains about child labour in its supply chain does not
necessarily feed into operational decision making processes, and where there are no performance objectives, would locate its response
at A. Here, the business is vulnerable to advocacy and brand damage, unprepared for potential regulation, and other businesses
leading on the issue may shy away from collaborating with it.
• A business which has systematic management and monitoring processes, policies, targets and ongoing engagement initiatives with
suppliers in place to address and minimise child-labour in its own supply chain would locate its issue response at B and can consider
itself to be in-step with societal development.
• A business which has developed sophisticated organisational policies and management systems on the issue, has assigned top-level
responsibility for avoiding child-labour, and is engaged with a wider range of stakeholders such as industry bodies, governments, NGOs
and the ILO in initiatives to solve the associated challenges, could locate its response at C. This strategic approach might give this
company the opportunity to profi le itself as a particularly responsible business in the marketplace and with regulators.
The Issue Response Matrix
THE PRACTITIONER’S HANDBOOK ON STAKEHOLDER ENGAGEMENT | 53
Analyse and Plan
P5: REVIEWING YOUR PROGRESS
SUGGESTED METHODOLOGY M5:
ASSESSING YOUR CURRENT ORGANISATIONAL RESPONSE
Th e purpose of this activity is to establish a clearer picture of the degree and
mechanisms that the business currently has in place to address specifi c issues. It involves
an assessment of current processes of management and stakeholder engagement in
relation to the issue, and helps you to identify areas for improvement.
• Using the Template 5 (below) as guidance, investigate what level of
development your organisation has reached in relation to each of your
prioritised issues, and note any particular areas where organisational response
enablers are weak in relation to a particular issue. The Template guides you in
doing this and helps to capture the results of this assessment.
• Chart issues on Issue/Response matrix (above) to highlight those areas
where you fall into the red risk zone or green opportunity zone.
• Identify target levels of development for specifi c aspects of your approach to
prioritised issues or stakeholder map.
• Finally, consider the fi nancial resources that may be required for engagement,
as well as for the possible outcomes of engagement. Are key budget holders
committed to supporting this process? Is it clear to which degree fi nancial
resources will be made available?
THINGS TO CONSIDER
• This process should draw on sources of expertise throughout the company,
including aspects of stakeholder management processes already documented
in policies and guidelines as well as through interviews, workshops or meetings
with key individuals within the company.
• The “current engagement activities” row should ideally be considered in
conjunction with the analysis of current engagement undertaken described on
p63.
The different rows of this table help you to assess whether your business’ current management systems / policies and processes
are adequate for the maturity of the issue in question.
If all of your responses are 1, your organisation is in a good position to respond to the issue in a strategic manner.
If your answers are all 2, then your business response can be considered as embedded.
If all answers are equal to 3, then the current processes are developing.
Answers of 4 indicate an exploratory approach. Finally if the majority of responses are 5, this indicates that your company is
not addressing the issue.
Consider your organisational response in light of the maturity of the issue – are you a leader or a laggard in relation to this issue?
How does this relate to your strategic objectives and assessment of risks and opportunities in this area?
Highlight areas for improvement in the fi nal row.
Explanation to Template T5
STAGE 2
THE PRACTITIONER’S HANDBOOK ON STAKEHOLDER ENGAGEMENT | 55
- Formal commitments in place with responsibility at board level.
- Formal commitments with responsibility at senior management level
- Formal statement or policies made but no formal responsibility at senior levels.
- Action to address issue driven by individual commitment and awareness.
- No awareness/action.
Give details: ______________________________________________
SUMMARY TEMPLATE T5:
ASSESSMENT OF ORGANISATIONAL ABILITY TO RESPOND TO AN ISSUE*
Governance and
management
commitment to issue
Latent
Policy regarding the
issue - Formal policy with objectives that are linked to business strategy.
- Formal policy with objectives that are not linked to business strategy.
- Draft or holding policy but no objectives.
- Early discussions about policy.
- No policy.
Give details: ______________________________________________
Current engagement
activities regarding
the issue - Formalised and integrated into management and governance processes with robust documentation and
reporting systems. - Systematised engagement approach with documentation and some linkage into decision making processes.
- Established engagement processes for some relevant stakeholders/ issues.
- Sporadic engagement processes, limited internal controls.
- No engagement.
Give details: ______________________________________________
Performance
indicators/
measurements
regarding the issue - Strategic objectives and SMART Key Performance Indicators (KPIs) set in order to meet management and
stakeholders’ information needs. Internal and external reporting and assurance mechanisms in place. - KPIs that respond only to internal management needs, internal reporting with little or no assurance.
- KPIs that only partially meet stakeholder information needs.
- Early discussions relating to development of KPIs and monitoring.
- No objectives set, no Key Performance Indicators.
Give details: ______________________________________________
Internal
responsibility and
competency to
address the issue - Issue related targets form part of the performance reviews of individuals, and are considered when deciding
on potential performance rewards. - Required competencies are addressed in recruitment and training, and considered in the rewarding of performance.
- Responsibilities assigned but no formal mechanisms to reward, recruit or train to ensure required competency.
- Early discussions relating to assignment of responsibilities and understanding of necessary competencies.
- No internal responsibility considered for this issue/ stakeholder
Give details: ______________________________________________
Review and learning
processes in regards
to the issue - Continuous review and learning to innovate and adapt organisational policy and processes, with learning
from engagements feeding into the organisation’s strategic decision making. - Review and learning processes generate limited changes relating to specifi c issues and departmental
functions. Organisational change management is starting to establish links with stakeholder analysis. - Ad hoc review and learning processes leading to incremental changes.
- Review and learning processes driven and limited to individuals.
- No stakeholder engagement happening on this issue.
Give details: ______________________________________________
Enabler
Emerging Consolidated Institutionalised
Social maturity of the issue:
Possible levels of action
Prioritised Issue:
(Example 1: re Performance measurements and indicators: “KPIs that provide internal guidance to managing the issue need to be developed.”)
(Example 2: re Review and learning processes: “Need to establish continuous review and learning processes so that we can adapt organisational
policies and processes in response to stakeholder expectations and organisational needs.”)
Overall adequacy of your ability to respond / areas which require improvement:
Which improvements are required in the 6 areas (rows) given above?
*electronic version downloadable at www.accountability.org.uk
Analyse and Plan
BACKGROUND
It is always worth knowing what others are doing in relation to similar issues
and/or stakeholder groups. Which challenges have they encountered and how
have they achieved success? What can you learn from them? Where there is
evidence of positive outcomes of stakeholder engagement on a particular issue
or in a particular part of the business? Are there ongoing partnership initiatives or
associations addressing this issue where working together would be benefi cial?
Your approach to stakeholder engagement does also not have to be developed
from scratch. Indeed in many cases it may turn out that the issues identifi ed as
material cannot be addressed by an individual business working alone or
bilaterally with some of its stakeholders but may call for sector-wide or multisector
action. Stakeholder engagement involves a cycle of learning and
innovation within the organisation, but it can also be part of a wider cycle of
‘civil learning and action’ both about how to do stakeholder engagement and
how to address the issues raised. This cycle of learning is accelerated when
organisations can learn from the mistakes and best practice of others.
Increasingly such learning is facilitated though networks and partnerships and
the development of resources in the form of case studies, tools and standards to
enable lessons to be transferred from one organisation to another.
The table below provides sources for ‘inspiration’ on what you could do to
address the issues and stakeholders that you have found:
P6: LEARNING FROM OTHERS AND IDENTIFYING POTENTIAL PARTNERS
STAGE 2
Information Source Examples
Links into Learning Networks6
• ISO 14001 (environmental management system standard)
• International Labour Organisation (ILO) Standards
• SA8000 Labour Standard
• Business Principles for Countering Bribery (from TI and SA International)
• OECD Guidelines for Multinational Enterprises
• Global Reporting Initiative Sustainability Reporting Guidelines
• AA1000 Series (quality framework for organisational accountability)
• The Sigma Guidelines (www.projectsigma.com)
• The Stakeholder Engagement Manual: Volume 1 – “The Guide to Practitioners’
Perspectives on Stakeholder Engagement”, Stakeholder Research Associates,
UNEP, AccountAbility
• CSR-Case Studies on www.wbcsd.org (World Business Council for SD) and on
www.conversations-with-disbelievers.net
• ‘Making Stakeholder Engagement Work’ www.csrcampaign.org
• ‘Risk & Opportunity: Best Practice in Non-Financial Reporting’ UNEP /
SustainAbility www.sustainability.com
• Business & Economic Development sector specifi c reports www.economicfootprint.org
• Industry as a Partner for Sustainable Development, 22 industry sector reports
prepared for the 2002 Johannesburg Summit (WSSD)
www.unep.fr/outreach/wssd/contributions/sector_reports/reports.htm
• Dow Jones Sustainability Index
• Accountability Rating 2005
• FTSE4Good
• Business in the Community Corporate Responsibility Index
Conferences, events and business networks on relevant issues showcase best practice
and provide opportunities to meet with others facing the same issues.
Sustainability reports are good fi rst source of reference :
• www.globalreporting.org (reports categorised according to use of GRI Guidelines)
• www.corporateregister.com (online-database for non-fi nancial reports)
Collaborations between companies, civil society and governments range from global to
sector, region, or issue-specifi c initiatives:
• United Nations Global Compact
• UNEP associated voluntary initiatives, eg UNEP Finance Initiative, Global
e-Sustainability Initiative, Tour Operators Initiative, Mobility Forum, Advertising and
Communications Forum www.unep.fr/outreach/home.htm
• Sector specifi c initiatives of the World Business Concil for Sustainable Development
(WBCSD) , see “Sector Projects” www.wbcsd.org
• Issue-based and industry associations, for example Fair Labour Association,
International Council on Mining and Metals, International Petroleum Industry
Environmental Conservation Association (IPIECA) (see examples of activities of 19
associations at www.unep.fr/outreach/business/best_practice.htm )
• (Sub)Region specifi c initiatives for example the Calabash Project for the SADC region
(see www.saiea.com/calabash)
Codes, Standards, Frameworks,
Guidelines and Tools
provide principle-based or step-by-step
guidance for action, as well as providing
a benchmark for your own activities.
Case-Studies, Best-Practice and
Research Reports
can provide inspiration when thinking
about your own approach, and ensure
that you learn from the experiences
(and mistakes) of others.
Benchmarks and Indexes
point you towards competitors or peers
with advanced practices. Use them to get
a relative perspective on your activities.
Competitors & other individual
companies who face similar issues
can be a rich source of information.
They may even be willing to collaborate
on issues with you.
Partnerships, Industry Associations,
NGOs
can be a powerful and effi cient way to
address issues. At the same time, such
associations are also often a good source
of information.
6 See annex for more examples.
THE PRACTITIONER’S HANDBOOK ON STAKEHOLDER ENGAGEMENT | 57
Analyse and Plan
SUGGESTED METHODOLOGY M6:
LEARNING FROM OTHERS
Th e purpose of this activity is to identify the most relevant sources of learning as well as
some potential partners for engagement.
Identify peers, partnerships, networks, tools and standards relevant to the
prioritised issues or stakeholder groups. Use the table above to guide you in
your search.
Questions to ask while considering this information
• What have other organisations done in order to engage with similar stakeholders
or to address similar issues?
• Which mistakes can we learn from, which practice has proven to be successful?
• Which standards and frameworks off er relevant guidance?
• How have others turned challenges into opportunities?
• Are these initiatives credible from the perspective of my important stakeholder
groups?
Consider likely areas for engagement with peers, for example in the form of formal
or informal networks, by signing up to shared codes of conduct or principles
(e.g. the UN Global Compact), or by joining or forming partnership initiatives
to address an issue.
Create an electronic or hardcopy fi le where you collect relevant case-studies,
documents, portraits of organisations, initiatives and standards for future reference.
Reference the most interesting ones in Summary Template 9 (p74).
THINGS TO CONSIDER
When looking for learning from others, you can also make use of the information
you have already collected for the materiality test in Stage 1 (p36). You may also
reconsider the results of that materiality test in light of any new information that
you may fi nd.
P6: LEARNING FROM OTHERS AND IDENTIFYING POTENTIAL PARTNERS
P7: ASSESSING YOUR CURRENT ENGAGEMENTS AND DRAFTING STAKEHOLDER SPECIFIC OBJECTIVES
BACKGROUND
In addition to fi nding out about your internal organisational ability to address
an issue, and to learning from what others are doing, it is of course essential to
fi nd out how you are currently engaging with your stakeholders on your material
issues. In essence you want to consider the following questions:
• How are you currently engaging on your prioritised issues?
• How do you need to improve your engagement and what kind of results are
you seeking?
Your approach to stakeholder engagement can be characterised at a number of
levels from passive/no engagement to empowering stakeholders to take decisions.
STAGE 2
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