Governance is evolving fast and investors alongside other stakeholders are demanding greater transparency and improved oversight. The legal opinion suggests effective stakeholder governance is an integral part of directors’ fiduciary duties. There is also an expectation that board directors not only understand and engage with their key stakeholders, but that they consider the impacts and dependencies they have on those stakeholders when making strategic decisions.
Research conducted by WBCSD in collaboration with DNV has shown that boards are detached from how the business engages with stakeholders and often their engagement is filtered, one-directional and absent from decision-making. Engaging with stakeholders should support business decision-making, drive transformation and strengthen the business model.
With input from over 100 board directors, executive management and functional leaders, this report is a summary of the findings of both the quantitative and qualitative research. It provides some practical actions for the board of directors to understand the importance of robust stakeholder engagement and to develop a network of relationships that build resilience, support strategic decision-making and drive value creation and long-term growth.