4 ways to improve internal stakeholder engagement skills

Businesses understand that corporate social responsibility (CSR) is more than just a box-ticking exercise. Three-quarters of investment professionals believe a focus on environmental, social and governance issues creates value for shareholders, according to McKinsey. 

 

Stakeholder engagement skills are therefore highly prized among corporate governance professionals, and a growing number of departments need staff who are adept at both the technical and interpersonal aspects of the job.

 

But how can staff meet stakeholder engagement expectations? What do we even mean by stakeholder engagement? Not all corporate governance teams will have traditionally been heavily involved in building these relationships, so let’s examine this skill in more depth.

What is stakeholder engagement? 

There are a few definitions for stakeholder engagement. The broadest use of the term refers to any individual who has an effect on an organisation and its activities or could be impacted by an organisation and its activities. Both internal and external parties are included.

 

Another interpretation – and the one we’ll be using for the purposes of this article – is that stakeholders are people or small groups who have the power to respond to, negotiate with or change an organisation’s strategic future. In other words, they are key influencers who can make or break a project.

 

CSR and business culture in general are increasingly under the spotlight since the global financial crisis. This means more corporate governance professionals either have a seat in the C-suite or must regularly communicate with senior executives on risk and related issues.

 

Interacting with the board and the wider business may be relatively new for some departments, so here are some ways to improve internal stakeholder engagement skills.

1. Identify and prioritise key stakeholders 

Your stakeholder base could be extremely wide, whether you’re working on a one-off project or continuously evolving strategies. Understanding who will be affected, how much influence they have and their level of interest should be your first task.

A senior executive may have relatively low interest in a particular project, but their buy-in is crucial to its success. Similarly, junior staff may be very interested in upcoming changes that affect their day-to-day job, even if they have limited power to influence the process.

Prioritising internal stakeholders enables you to focus your energy and engagement efforts on the individuals with the biggest impact. Stakeholder mapping tools and applications are available to make this task easier.

2. Understand and align stakeholder expectations

You can’t please everybody all of the time, so you’ll no doubt be thinking “easier said than done” when trying to align stakeholder expectations. Nevertheless, any project, strategy or activity will run more smoothly if you can get everyone more or less on the same page.

 

This requires exploratory conversations with key stakeholders and transparency regarding the hows, whats, whys and whens of your proposals. Frequent communication is important, as a particular stakeholder’s influence and interest in an issue or project can shift quickly.

 

Again, prioritise the expectations of the most important stakeholders when aligning your engagement and management strategy.

3. Proactively resolve disputes

There will always be hiccups with stakeholder engagement, regardless of how extensively you’ve mapped the process. Learning dispute resolution skills should help you mitigate any problems that arise.

 

The first step is fairly easy but often ignored: listen. An effective technique is to reflect a stakeholder’s comments back to them to show you’ve heard and understood their concerns. For example, you may say: “Just to clarify, you’re unhappy because [insert their reason in your own words].”

 

You should also provide a forum for dispute resolution where stakeholders can air their grievances and discuss mutually agreeable solutions. A moderator may be required to ensure everything remains civil and the meeting stays on track.

4. Speak plainly 

Corporate governance is often steeped in jargon. Whether you’re an internal auditor, compliance officer, in-house lawyer or other governance professional, you’ll be familiar with the technical and regulatory terminology specific to your role.

 

However, don’t expect your internal stakeholders to have the same level of knowledge. This is particularly important with key board influencers, who may wield significant power and will be hesitant to greenlight anything they don’t understand.

 

One of the most difficult skills to learn is delivering bad news without obscuring the details. Transparency is often the best policy, although diplomacy rarely goes amiss.

Are interpersonal skills in short supply?

Stakeholder engagement requires excellent communication and relationship-building capabilities, as well as solid business acumen and an understanding of how each department interacts.

 

However, employers have cited interpersonal skills as a key challenge when recruiting corporate governance professionals. In fact, 42 per cent of hiring managers for security and resilience positions cited this as their biggest hurdle, according to our research. Only 29 per cent faced difficulties attracting staff with the right technical abilities.

 

This emphasises how quickly cyber and data security have become prominent issues at the board level, with resilience professionals expected to interact more closely with key business figures. Similar patterns can be seen across risk management, compliance, in-house legal and internal audit departments.

 

Are you having difficulty finding applicants with the right combination of technical and stakeholder engagement skills? Barclay Simpson are experts in corporate governance recruitment, so please contact us on 020 7936 2601 for more information on how we can help.

 

Our 2018 Market Reports combine our review of the prevailing conditions in the corporate governance recruitment market with the results of our latest employer survey.

 

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