Why Stakeholder Engagement Matters

Abstract

Understanding and addressing stakeholder expectations is essential to the success and survival of any contemporary organization. This chapter considers the importance of meeting and ideally exceeding stakeholder expectations with respect to corporate social responsibility. The concept of organizational stakeholders is introduced, as is the stakeholder analysis process that serves to identify an organization’s stakeholder groups and the expectations that each group has for the organization. While meeting all realistic stakeholder expectations is important, ideally an organization will be able to exceed these expectations. A brief overview of corporate social responsibility designed to provide the context for considering why stakeholder engagement matters is provided. The importance of balancing the often conflicting expectations of various stakeholder groups is discussed. This includes aligning an organization’s corporate social responsibility initiatives with such traditional business goals and stakeholder expectations as generating desired profits and return on investment. The importance of corporate social responsibility from a business perspective is discussed, as is an organization’s responsibility to engage relevant stakeholders in its corporate social responsibility programs and activities. The chapter concludes with consideration of how an organization can engage stakeholders and gain their commitment to its corporate social responsibility initiatives, and how these initiatives can align with their expectations for the organization. The essential importance of communication strategies is emphasized as the foundation of a successful stakeholder engagement plan.