Stakeholder Engagement

A highly-respected leader of the corporate affairs function of a Fortune 10 company recently told us that his best advice for a rising talent in the field is to aspire to be a business leader rather than a communications strategist.

Just as the chief marketing officer understands the mind and emotions of the “end user,” the chief communications officer (CCO) must understand the minds of the company’s broad stakeholder groups so that she or he can help build the company’s reputation and create shareholder value. On the other side of the cliff, they need to be able to protect it when the very reputation they’ve advanced, or shareholder value they’ve created, is threatened.

The coming storm

It’s a job that’s talked about a lot these days, as companies and their boards increasingly come to understand that no company can speak in terms of if when referring to existential threats. As one after the other has found, weathering that storm when it comes is less about crisis plans and pre-baked communications responses than it is about inherently business-oriented professionals understanding the needs, emotions and touchpoints of their stakeholders, and being in the position at the company to influence how they are addressed.

Sometimes defined as “stakeholder capital,” the trust that exists among stakeholders has a direct impact on a company’s ability to fully – and speedily – recover from a crisis or create value by expanding its offerings and entering new markets. Complex decisions require a broad perspective however, and a deep understanding of business operations, markets and financials enables the CCO to project the reaction to decisions among those with a vested interest in company behavior, and credibly inform the C-suite accordingly. With virtually all of our clients, we see the tangible evidence of the immense value of business acumen in the CCO.

More than ever before, the current business, social and political environment also requires that CEOs become students of the communications function and invest in building stakeholder capital. Today, the behavior (or misbehavior) of an employee, a product quality spill, an offhand comment by an officer, or a tweet by POTUS can drag a company to new lows in minutes. It’s something to truly grasp and internalize.

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