csr 3 stakeholder engagement
TRANSCRIPT
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Stakeholder Management
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Questions to be addressed for
Stakeholder mgmt..
1. Who are our stakeholders?
2. What are their stakes?
3. What opportunities & challenges arepresented by them?
4. What CSR does the firm have towards
them?5. What strategies and actions would be best to
deal with these responsibilities?
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Who is a Stakeholder?
Any group or individual who affects or is
affected by the achievement of the
organization's purpose.
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ORGANIZATIONAL, ECONOMIC & SOCIETAL
STAKEHOLDERS
Employees Managerial Stakeholders Unions
Customers Creditors Distributors Suppliers
Communities
Govt. & Regulators Non-profits and NGOs
Environment
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Classification of Stakeholders
Primary Social
Stakeholders
Secondary Social
Stakeholders
Primary Non-Social
Stakeholders
Secondary Non
Social
Investors Govt & regulators Natural
environment
Environmental
pressure groups
Employees
&Managers
Civic Institutions Future generations Animal welfare
organisations
Local Communities Social Pressure
groups
Non human species
Suppliers Media and
academic
commentators
Other business
partners
Trade bodies,
industry
associations
Competitors
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What are the stakes?
Examples
Customer Segment 1 High Users of product,
seek improvement in product
Customer Segment 2 Low users of product,
required substitute
Employees Job security and pensions Political Parties Able to influence regulatory
process
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Influence of National and Regional
variations on CSR
High stress environments the area has hadalong period of economic disadvantage
Structurally disadvantaged areas remote places
Crisis Zone Collapse of a dominant company orindustry
Transitional Area
Forced to change areas regions based on a firmor industry are forced to change due to newentrants
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Other factors..
Culture
Role of government
Developed, developing and emergingcountries
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Importance can be judged based on
Power ability of stakeholder to influence
organizational decisions and actions
Legitimacy how far the organization
perceives the activities of stakeholders as
appropriate and desirable
Urgency the importance of stakeholder
claim to immediate actions
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Based on the above
Latent - one attribute
Expectant - two
Definitive all three
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Benefits to stakeholder
Functional Psychosocial
desirable end-states based on individual
values
Benefit to company
Cost reduction
Revenue enhancement Increased market value
Improved competitive conditions
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Benefits thru customer stakeholder
Improved loyalty
Improved image and reputation (build reputation
or lower reputation risk)
Benefits thru investor stakeholder
Screened portfolios
Improved reputation
Decreased long-term risk
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Benefits thru government stakeholder
Thru
Core business operations and investments
Strategic philanthropy and community investing
Public policy dialogue, advocacy and institutionbuilding
Results in
Gaining license to operate (tax credit, M& A
agreements, product/process monitoring) Developing connections with decision makers
Shaping policies and regulatory environment
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Benefits thru community stakeholder
Enhanced local reputation and integration
Benefits thru supplier stakeholder
Decreased cost
Increased revenue
Benefits thru employee stakeholder
Commitment and motivation
Recruitment and retention New skills and training
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Capitalizing CSR through Stakeholder
Orientation
Four stages
1. Identification
2. Commitment3. Trust
4. Satisfaction
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Stakeholder Map
Step 1: Identify generic stakeholders (Primaryand Secondary Group)
Step 2: Historic Analysis of the environment of
the firm Step 3: Identify Specific stakeholder groups
Step 4: Identify the stakes of these specific
groups Step 5: Identify the networks among the
stakeholder groups.
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Identifying Key Stakeholders
Medium Priority forattention
Medium priority for
attention
Low Priority for
attention
High Priority forattention
Low High
CompanysInfluence
St
akeholdersInterest
Insig
nificant
Signif
icant
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The Process Level
What are the processes a firm follows to
achieve a fit with the external environments?
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Types of partnering with Stakeholders
Knowledge Sharing thru feasibility studies,
proposals and evaluations
Dialogue
Informed Consent
Contractual
Shared Work Plans Shared Responsibility
(Warner and Sullivan 2003)
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Interacting With Stakeholders
(Transactional Level)
Routine Transactions Buying, selling,
dividends, AGM
Others Handling customer complaints, press
meets, meeting financial analysts, union, local
government bodies, other government
officials
Employees
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The Wal-Mart Controversy!!
Wal-Mart us one of the most powerful companiesin the world. At the foundation of the companys
success, however is its strategy of minimizing
costs, which relies on many policies that affectstakeholders in different ways.
Detail the various ways in which Wal-Mart affectsseveral stakeholder groups and what the
company has to offer to each of those groups. Is there a net-positive or a net-negative impact
on each of them?