Engaging Stakeholders - Turning Duty into Dialogue
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Future Directors Founder, Paul Smith
ONE THING is for the busy (speak of the devil) Future Director, in which we pick just one thing Future Directors oughta know or do or stew on for the next month. We hope you get something (at least one thing) out of it.
In my previous articles, I explored the overlooked dimensions of directorial duty of care by first remembering that you and your fellow board members are stakeholders too, and then examining why not all stakeholders can always be treated equally.
If you missed either of these, you can find them here and here.
This month, I complete my trilogy by turning theory into practice. How do we actually engage with these stakeholders once we've identified and prioritised them?
Identifying your stakeholders is just the beginning. The real work, and the real value, comes from meaningful engagement. And no, sending the annual report, conducting a staff survey, or having the management report secondhand feedback doesn't count as real engagement.
First, let’s talk about why busy boards should invest precious time engaging with stakeholders. For anyone new to the boardroom (or in need of a refresher), it's quite simple. External perspectives shape our strategies, challenge our groupthink, and surface blind spots before they become issues. The needs of all the different stakeholders, when fully understood and appreciated, become opportunities rather than risks. Similarly, if caught early, the concerns of stakeholders can be managed before they become emergencies. While your board is busy having new conversations with the different voices, your competitors are likely missing these insights entirely. That's your advantage.
The key to effective engagement is quality and context. For internal stakeholders like staff, some of the richest insights come from the places boards rarely look. Try having working lunches with high-potential employees two layers down from the executive team. These future leaders will tell you things the C-suite can’t or won't. Or invite functional leaders to present directly to the board occasionally, skipping the C-suite filter that inevitably smooths out the edges of reality. And yes, actually walking the floor of your operations (old school as it may be) gives directors insights no dashboard can provide.
External stakeholders require different approaches. Advisory groups with genuine board participation (not just ceremonial appearances) create ongoing dialogue rather than periodic data points. This can be done with clients, customers, and community.
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