The Importance of Stakeholder Engagement

Namhla Saba

15 years: Chartered Accountant & ESG Specialist

Want to avoid a huge PR debacle? Engaging with your stakeholders is a good start. Join Namhla Saba as she explores what stakeholder engagement is and why it matters.

Corporate Governance

Want to avoid a huge PR debacle? Engaging with your stakeholders is a good start. Join Namhla Saba as she explores what stakeholder engagement is and why it matters.

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The Importance of Stakeholder Engagement

15 mins 3 secs

Key learning objectives:

Define stakeholder
Define inclusive stakeholder engagement
Understand why listening is important for governance

Overview:

Knowing your stakeholders, their expectations, and the risks they come with is crucial to help you prevent a financial disaster. A lack of knowledge can lead you into a company-destroying scandal. The Global Reporting Initiative defines a stakeholder as "an entity or individual that can reasonably be expected to be significantly affected by the reporting organisation's activities, products, or services or whose actions can reasonably be expected to impact the ability of the organisation to implement its strategies or achieve its objectives.” Inclusive stakeholder engagement can be defined as an organisation's systemic process to collect primary data through engagement, to build and maintain symbiotic relationships between itself and its stakeholders.

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Summary

What is a stakeholder?

The Global Reporting Initiative defines a stakeholder as "an entity or individual that can reasonably be expected to be significantly affected by the reporting organisation's activities, products, or services or whose actions can reasonably be expected to impact the ability of the organisation to implement its strategies or achieve its objectives.”

What is inclusive stakeholder engagement?

Inclusive stakeholder engagement can be defined as an organisation's systemic process to collect primary data through engagement, to build and maintain symbiotic relationships between itself and its stakeholders.

Why is listening to your stakeholders important for governance?

Knowing your stakeholders, their expectations, and the risks they come with is crucial to help you prevent a financial disaster. A lack of knowledge can lead you into a company-destroying scandal. The rise of social media has expedited the speed, power and impact of information between business, society and long-term sustainability. Social media has made it easier for people to share information, vent their complaints publicly and paint a narrative. Numerous organisations have found themselves at the back end of the consequences of stakeholders' unmet expectations.

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Namhla Saba

Namhla Saba, Founder and Director of a firm advising corporations, funds, and NPOs on ESG and social development, has over 15 years of experience in social and governance issues across sectors like financial services, mining, and infrastructure. She leads community stakeholder engagement projects for clients seeking to maintain their "social license to operate" in developing markets like South Africa, bridging relational and information gaps between corporations, employees, customers, and communities.

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