Working Paper

Integrated Stakeholder Engagement: Putting Sustainability at the Heart of Corporate Value Creation

Author: 
2017-09

This paper takes a comprehensive view of the existing literature on stakeholder engagement and attempts to provide answers to the issue of the transition to sustainable business practices. By serving as an interface between companies and the rest of the world, stakeholder engagement provides an opportunity to create partnerships that contribute to the benefits of the society as well as companies’ competitiveness. However, stakeholder engagement is still mainly carried out as part of corporate social responsibility (CSR) initiatives, on the side of main business functions. While this approach has proved to generate some positive results, it fails to transform the current economic model towards a sustainable one.

This paper argues that integrating stakeholder engagement into core business functions on a daily basis can bring the three aspects of sustainability – economy, society and environment – to the heart of corporate value creation. To do so, firms need to realise that the ability to understand and adapt to the motives of a broad range of stakeholders is a crucial factor for the success of their business. Eventually, companies should assess their business purpose in view of their wider role in society, align their business model and strategy with sustainable values, and aim for co-generating positive outcomes for all stakeholders.