John Mackey and Raj Sisoda, in their groundbreaking book Conscious Capitalism, consider stakeholder integration crucial to a conscious business. They ask us to “envision a business that embraces outsiders as insiders.” They argue organizations should care for all stakeholders, be honest with them, be transparent, have integrity, be fair, and collaborate with them.
That’s a tall order. How, exactly, do you do all that? Based on research, experience, and case studies, these guidelines can help your business build a respectful and open relationship with all stakeholders — and assure processes in which stakeholders work with management, not against it.
- Understand your stakeholders’ culture and values. Know who these people are and what they care about. This requires listening and regularly gathering feedback from employees, customers, suppliers, investors, community members, and even the media.
- Inform stakeholders before making decisions that affect any of them negatively. If you’re not sure how stakeholders will react, ask. People want to be acknowledged and consulted, and want to help develop solutions. For example, there are many instances in which some employees offer to work part-time so their colleagues are not laid off. Communities often willingly accept rate hikes from water utilities when they are involved in the decision-making process. Stakeholders can understand and even support business decisions when they are treated as “insiders.”
- Assure relevant information and sources are accessible to interested parties. Answering questions not only shows the company respects stakeholders, it builds good will. When the company shows it has nothing to hide and is willing to engage in dialogue, it’s enhancing stakeholder loyalty.
Act with integrity
- Make your actions and words consistent. This requires company-wide commitment and coordination. The integrity of your words and actions are crucial to building trust.
- Be factually accurate in all of your communication. Your company’s credibility and expertise are important. If you find an error, correct it immediately.
- Communicate the fundamental or core issue(s). This is an important part of transparency. Transparency doesn’t mean telling every little thing; it means being honest about the relevant issues.
- Disclose the full meaning for stakeholders as clearly as you know, and be open to hearing other impacts. After all, each stakeholder group has different needs and values, and they may raise something important that you have overlooked.
- Be clear in your communication, translate technical terms, and explain jargon. All organizations and professions have their own language. It’s easy to forget that not everyone understands terms that may be second nature to you.
- Provide relevant information to stakeholder groups in all settings and through all media. Issues that one group cares about — employees, for example — may be a bit different from what the community cares about. Your initial listening and information-gathering comes into play here and helps you understand the full range of issues.
- Be responsive to stakeholders’ concerns. This is where the rubber meets the road, as the expression goes. If people have significant concerns, issues, and suggestions, it’s important to listen and perhaps alter the decision, or seek creative solutions. Here is where rule Number 2 sets the stage for everything that follows. That is, if you have floated the idea or issue before making the decision, you can then truly seek meaningful feedback.
- Show care and respect to all stakeholders. This means setting ground rules for all “sides.” As you begin the communication process, specifically state that your company will be respectful and courteous and you will welcome input and opinions that are in the same vein. It’s not a free-for-all. It’s a conscious process of getting to the best decisions and solutions.
For meaningful collaboration, share these rules of engagement with stakeholders, as they need to understand them, too. And in doing so, and living them, your reputation as a standout company is enhanced.
These cardinal rules make the conscious capitalism vision of “stakeholder integration” real. And that is not only good in itself, it’s good for business.