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Stakeholder engagement

Why Stakeholder Engagement Is Critical to Sustainability

By 28 September 2022No Comments

If you are interested in driving long term sustainability at your organisation, engaging stakeholders is critical. Not unlike other aspects of business, engaging your stakeholders with the topic of sustainability is crucial for lasting change to occur. Stakeholders are also invaluable for business success, and the same can be said for championing sustainability.

Stakeholders are generally defined as “a party that has an interest in a company and can be affected by their business activities”. Typically, this group is made of investors, employees, the general public and suppliers. Don’t forget that you should also see the planet as a stakeholder for all businesses as climate can be affected locally and globally by operations.

These parties can also exert influence over the organisation in return. Engaging with stakeholders helps organisations identify relevant problems and address concerns. Regardless of the complexity of your sustainability plan or your organisation size, involving key stakeholders can help identify priorities, mitigate risks and provide solutions.

Stakeholder involvement should begin as early as possible, starting with an initial materiality assessment. A materiality assessment is the process of identifying and assessing potential environmental and social issues that could affect your organisation and stakeholders.

Fully involving stakeholders at an early stage in your sustainability journey is the key to optimising your organisations’ environmental impact. To get started we recommend the following phases:

  1. Obtain a detailed analysis of your business impact
  2. Receive stakeholder perspective, what issues are they identifying?
  3. With this newly acquired understanding, create a prioritised plan of action

This is a robust process, created to determine an organisation’s priorities, thus informing decision making and strategic resource allocation in terms of people, budgets and investments. Involving all the key stakeholders allows for a more informed process to take place.

Remember, working towards sustainability is an ongoing process and so is achieving stakeholder engagement. The three phases should not be isolated incidents, but rather a journey that the business can continue on. Your organisation should be open to implementing change and evolving with the feedback of stakeholders.

Phase 1: Detailed Analysis

This requires a thorough assessment of company operations in order to get to the heart of key issues. Engaging key stakeholders will allow insights from groups that are most knowledgeable when it comes to these problems.

In order for this phase to be successful, a systematic and detailed approach should be applied at this stage. Examining your business impacts carefully will maximise results from the overall analysis. Identifying key areas of your business impact will require collaboration across multiples groups and dialogue should be opened up among various channels. Sustainability issues within your company operations may range from energy and water management, packaging and more.

Once your organisation has identified its most pressing issues, company sustainability plans and goals can be aligned with the overall business strategy. This foundational understanding will help guide and anchor your sustainability journey moving forward.

Phase 2: Stakeholder Perspective

This is the time to engage your stakeholders in new ways. We recommend working on establishing a solid base with your external stakeholders and opening up meaningful dialogue. Include stakeholders from the wider community, even those that may have vocalised problems with your organisation directly. In order to reach the most meaningful solutions, strategic collaborations with an assortment of groups can give you the widest and most eye-opening solutions.

During this process, ensure that your organisation is open to change and focused on new solutions. Don’t be tempted to defend or dismiss opinions, but instead listen to upcoming issues and build relationships. This step alone can have a significant impact on reputation when it comes to working towards sustainability.

By involving key internal stakeholders in the materiality process and providing a communication platform, companies are able to break down departmental barriers and build cross-functional teams. This can bring about long-term value for your organisation.

External stakeholders should also include sustainability experts within your industry so you can set best practice standards from the very beginning. Our materiality consultants can help you find these experts for you to leverage within the assessment process.

Phase 3:  Action

While reporting and disclosing environmental impact is compulsory, driving change is truly the purpose behind this practice. The best materiality assessments lead to change within business, generating value for the wider community as well as the organisation.

The aim of reporting should be to deliver focused communication and create a positive impact on issues that matter most, both to the business and the stakeholders.

Stakeholder engagement is now more than just good practice, but a legal requirement. The CDP, a not-for-profit charity that runs the global disclosure system for large bodies managing environmental impact, requires reporting on engagement.

CDP Engagement Reporting

The CDP will inquire into relationships between organisations and key stakeholders, such as:

Trade Associations
The CDP requires organisations to provide details of any trade associations boards they are a part of and record the trade association’s position on climate change. Engagement activities between the organisation and the trade associations should be recorded.

The CDP requires organisations to detail the format of their climate-related engagement strategy with customers. This type of engagement could be educational or informative, for example. Your organisation should make record of the group of customers chosen for engagement and the details of engagement.

Details of organisation’s climate-related supplier engagement strategy should be included in reporting. The number of suppliers and supplier related Scope 3 emissions should also be mentioned. Engagement rationale needs to be validated as well as its subsequent impact and success. Engagement could consist of compliance or onboarding, as an example.

Stakeholder Engagement is not as simple as it seems

Stakeholder engagement can make a big difference to your organisation, helping you succeed through valuable feedback. The question is, how do you ensure that engagement is actually achieved? Simply reporting stakeholder contact will not lead to success.

Here are some ways you can drive improvement when it comes to engagement:

  • Emphasise the importance of your project or goal
  • Communicate the benefits of your project on a personal level
  • Set clear agendas and plan ahead
  • Make time for face-to-face conversations
  • Alert key stakeholders of milestones
  • Include them when speaking about results

How Sustainabl can help:

Engaging stakeholders and receiving valuable insights from their feedback can be challenging. At we have a solution to encourage action and drive stakeholder engagement. We provide a digital engagement tool to help you form a better understanding of your environmental impact, helping you establish a foundation from which to work from. We are committed to helping any organisation, big or small, engage their stakeholders and manage responsibility when it comes to controlling the impacts of business. 

Find out more about our Stakeholder Engagement tools and begin your journey towards optimising stakeholder engagement today!

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