2.1 Commit to the AA1000 AccountAbility Principles
The organisation shall make a formal commitment to the accountability principles as defined in the AA1000 AccountAbility Principles Standard (2008). This commitment shall be communicated throughout the organisation.
The three accountability principles are: Inclusivity, Materiality and Responsiveness. Inclusivity is the participation of stakeholders in developing and achieving an accountable and strategic response to sustainability. It is the commitment to be accountable to those on whom the organisation has an impact and who have an impact on it, and to enable their participation in identifying issues and finding solutions. It is about collaborating at all levels, including governance, to achieve better outcomes.
Inclusivity requires a defined process of engagement that provides comprehensive and balanced involvement and results in strategies, plans, actions and outcomes that address and respond to issues and impacts in an accountable way.
The principle of Inclusivity is also necessary for the achievement of the other two accountability principles: Materiality and Responsiveness. Inclusivity is the starting point for determining materiality. The materiality process determines the most relevant and significant issues for an organisation and its stakeholders. Responsiveness is the decisions, actions and performance related to those material issues.
The commitment to inclusivity should be formalized in a way consistent with the governance of the organisation. This may require a specific policy statement or the inclusion of the commitment in vision, mission or value statements.
In doing this be sensitive to cultural context and any other values or principles that the organisation has committed to.
2.2 Integrate with organisational strategy and operational management
The organisation shall include stakeholder engagement as an integral element of all
To ensure stakeholder engagement is truly embedded, all policies and procedures for setting strategy and managing operations should be revised to include the requirement to use stakeholder engagement where appropriate.
This includes integrating it with risk identification and management. Enterprise risk management is now a common practice. Enterprise risk management policies and procedures are improved with the addition of stakeholder engagement. This is especially the case if an organisation is using enterprise risk management as a mechanism for determining material issues and appropriate responses.
2.3 Integrate with governance
The organisation shall include stakeholder engagement as an integral element of all relevant decision making policies and procedures.
All relevant governance policies and procedures, as well as all policies and procedures that affect the inputs into governance, should be revised so that they integrate stakeholder engagement. Governance policies and procedures are relevant when they are associated with an issue or action that will have a material impact on a stakeholder or will affect the way in which a stakeholder has an impact on the organisation.
The figure above illustrates how the policies and procedures to integrate stakeholder engagement in strategy and operational management decisions and actions are overlaid on the commitment to the accountability principles.
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SORRY…but this may be somewhat duplicated due to an internet connection blunder.
To what extent does one address the chicken and egg principle when identifying, prioritizing and/or including stakeholders in a discussion?
Is it expected that companies will unilaterally identify their key stakeholders, or is there an assumption that the process will be ongoing, such that previously identified stakeholders will be expected to identify and/or nominate other stakeholders?
Particularly with respect to social and/or environmental issues, it seems as if stakeholders would be less inclined to identify others, for fear of losing some form of strategy advantage with respect to obtaining favour within the company.
At present, it’s as if stakeholder engagement and crisis management are the two most inextricably linked activities within and organisation: using the age old ‘squeaky wheel gets the grease’ adage to ensure that ‘concerned stakeholders’ are included in forward looking strategies.
How does one deal with ambivalence among key stakeholders?
It’s one thing to identify and prioritize key stakeholders, but if their neither willing nor able to participate in a meaningful dialogue, then mention for mention sake, is not necessarily useful in the context of transparency and accountability. Moreover, one cannot necessarily name and shame stakeholders for their lack of utility, despite the desire to do so. Even if a critical stakeholder, or rather what is deemed ‘should be a critical stakeholder’, doesn’t actively participate in shared risk and/or opportunity identification discussions, the reporting entity would be unwise to make mention of if.
This is perhaps of particular significance in developing countries, where capacity among special interest sectors is week. In South Africa, shareholder activism is almost completely non-existent, and with the rare exception so is environmental activism. Community development and/or social well-being is the cause célèbre of the day, from well-healed and well-meaning NGOs, through to the poverty pornographers who believe adopting an African child (orphaned or otherwise) is somehow chic. However, even the social development interest groups are rarely willing to discuss overall sustainability unless in the specific context of how they can benefit.
To what extent is it the role of AccountAbility to at least recommend possible strategies for stakeholder identification, prioritisation and/or engagement? Far too many organisations have far too weak an understanding of what stakeholder engagement is, often referring indication that “of course we have shareholder and analyst presentations”. Is it thus the role of AccountAbility, whether within or supplemental to the AA1000SES, to provide concrete suggestions on these matters?
OK…enough for now.
Posted by Michael H. Rea on 23 Aug 2009Michael