Corporate social responsibility is an approach that includes all internal and external stakeholders of a company in its various decisions. The company of the future seeks to be inclusive and open to the outside world. To be inclusive, a responsible company must first identify all stakeholders it affects. Once identified, the company needs to integrate these stakeholders and work together with them. So, how do you get started? We’ll explain the role of stakeholders in CSR Strategy in this article!
Who are the stakeholders?
Identifying stakeholders can take some time as there are so many of them! In the past, we tended to talk first and foremost about ‘shareholders’. But for some years now, responsible companies have been taking a different stance and use the term ‘stakeholders’ which refers to all those involved in and around a company.
Stakeholders are all the physical or legal entities that interact with a company and its business. This ranges from internal employees to customers, business partners, public authorities and suppliers.
Different stakeholders have different relationships with the company:
- Active economic stakeholders (suppliers, business partners, customers, employees)
- Observers and/or influencers (non-profit organisations, trade unions, lobbies, government)
- Beneficiaries or victims, depending on the positive/negative and direct/indirect effects of the company’s activities (local communities, etc.)
Who are the internal stakeholders?
All those who interact directly with the company:
- trade unions.
Who are the external stakeholders?
- local communities;
- business partners;
Why are stakeholders important?
Corporate social responsibility grants stakeholders a far more important role than before. They have become an essential component of the strategy.
A responsible company’s ‘impact culture’ is built on the balance between its economic, environmental and social concerns. CSR teams are tasked with protecting this balance and setting impact improvement targets. Another of their tasks is to ensure transparency and an inclusive approach to stakeholders. A company’s prosperity depends partly on creating shared added value since without its stakeholders, a company cannot continue to develop and evolve.
This added value opens the way for collaborative innovation and the possibility of creating tailored products and services. It also helps to provide a holistic view of your CSR strategy.
First step of the CSR strategy: identifying stakeholders
One of the first steps in launching a CSR initiative is to identify all the company’s stakeholders. Once done, it is particularly important to identify these stakeholders’ expectations of how your company manages its impact.
When launching a CSR policy, project leaders already have a vision of the sustainable commitments and objectives they wish to achieve. However, their vision is internal and personal. Other stakeholders may potentially have a different view of what the company’s priority should be. It is therefore important to do extensive research and include the results in your CSR strategy.
Co-building a CSR strategy with the help of stakeholders
The stakeholder map
As already mentioned, the first phase of a CSR strategy is to identify the company’s internal and external stakeholders. Take a moment to brainstorm and list the different stakeholders who interact with your company. You can go a step further and rank your stakeholders in order to understand the influence each has on your business.
The materiality matrix
Once stakeholders have been identified, it is useful to understand their expectations of how the company manages its impact. The aim of this process is to rank the company’s social, environmental and economic commitments. By comparing the expectations of your stakeholders with those of the company, you can establish the guidelines for your CSR strategy. We will explain everything about the materiality matrix in next month’s article !
Raising awareness on sustainable development
As we have already explained in a previous article, raising awareness is a key element to implementing CSR. If you want to engage stakeholders in your strategy, it is important to ensure that the different concepts of sustainable strategy are understood.
Informing stakeholders about sustainable issues helps to raise their awareness, make them responsible and engage them in the company’s collaborative and inclusive approach.
Communication and transparency
The process does not end there, of course! The collaborative process is ongoing and the company must be transparent about its strategy and the actions it decides to take.
It must learn to communicate honestly and be open to feedback and dialogue. Beyond the idea of stakeholder accountability, the company should seek to provide a space for co-creation that builds sustainable business relationships.
Sustainable reports, newsletters, social networks and meetings are some of the ways you can communicate about a company’s actions.
We hope this article has helped you to see just how important stakeholders are to a responsible company. If you too want to identify and integrate your stakeholders into your CSR strategy, we can help! Contact us here to find out more.