Nathan Springer, Associate, Advisory Services, BSR
It is a familiar scene to many: Community relations teams list stakeholders and touch points from the previous year, draft a sustainability report chapter, and check the “stakeholder engagement” box. But while stakeholder engagement reporting has become a familiar part of business, are the results of engagement being reported in a meaningful way?
A growing number of companies are finding ways to improve the quality of their stakeholder engagement in order to enhance business and sustainability performance. These companies are using reporting as an important vehicle to facilitate, monitor, and evaluate stakeholder engagement.
One financial services firm, ANZ, has done just that. A top bank in Australia, New Zealand, and the Pacific, ANZ saw its highest growth potential in other parts of Asia. In 2009, while planning its expansion into countries like China, Indonesia, and Vietnam, ANZ developed a company-wide corporate responsibility framework with 55 stakeholder groups who aligned their strategy with stakeholder expectations in those countries.
The result was a growth plan, a corporate responsibility framework, and a network of stakeholders that could enable responsible market entry and expansion. The company now boasts hundreds of thousands of customers across several countries including Cambodia, where the monthly growth rate exceeds 20 percent.
ANZ has tracked its progress through reporting and engagement. They distribute a monthly corporate responsibility bulletin to 5,400 stakeholders, produce interim reports with updates on progress against sustainability targets, and work with various stakeholders to conduct their annual Corporate Responsibility Review in conjunction with their Annual Financial Review.
Another example of effective stakeholder engagement reporting is with Nestlé Waters North America (NWNA), the largest producer of spring water in the U.S. NWNA developed a siting and community engagement framework to help the company become more transparent while identifying and managing specific sustainability risks with material impacts to the business.
For NWNA, stakeholder engagement on reporting has helped track, evaluate, and communicate progress. Through feedback from local stakeholders, site-level community relations staff have identified material community, water, and other sustainability issues. By consulting with national NGOs for their insight and feedback on the annual report, NWNA has also been able to track and evaluate progress towards their enterprise goals.
There are several principles for effective use of reporting to support stakeholder relationships and improve the quality of stakeholder engagement:
Align with business objectives and cycles. My BSR colleagues and I may feel like roosters crowing every day with “align your sustainability and business strategy,” but it works. ANZ developed its Corporate Responsibility Framework before making a strategic move in partnership with key stakeholders that gave them market insights and credibility. They also aligned stakeholder and reporting cycles with business cycles.
Tailor the channel to the audience. A monthly newsletter with anecdotes may be a more effective channel to reach and include local stakeholders, while the annual report provides credible disclosure on risks, opportunities, and progress toward targets. Social media and advisory councils all have their role to play in reaching specific audiences. NWNA uses its website as a gateway to different sections of the report relevant to specific stakeholder groups.
Make reporting an ongoing engagement opportunity. Each of the channels mentioned above offers the additional benefit of deepening stakeholder engagement. ANZ used the opportunity of growth to engage stakeholders in its dual business and sustainability strategy, while NWNA sees engagement opportunities at each step of the life cycle of a bottling plant.
Building the company checklist for stakeholder engagement reporting is a suitable start. Just make sure to do it all the time, to do it during natural business cycles, and to use reporting as a chance to connect with stakeholders and monitor progress.