Organisations are facing challenging times – be it from geopolitical headwinds, confusing global and economic indicators, the disruptive potential of AI, or the accelerating impacts of climate change, to name but a few. As the Financial Times recently commented, “The world economy is in an age of disorder… It is dangerous to have confidence in what lies ahead.”

At such a time when confidence is fragile and decision-making is increasingly short-term; it has never been more important for organisations to reach out and engage directly with their stakeholders. The need to listen, question, gain insight, understand context and communicate with those who have a material interest in your business, and the longer-term future of your business, has never been so relevant. A multi-stakeholder audit is a valuable way to equip leadership teams with the necessary data, both qualitative and quantitative, to be more confident about the immediate priorities they are setting and the decisions they are taking.

15 years ago, one of SIFA’s directors helped to introduce an annual stakeholder audit across many markets for a global brewing business. We looked for feedback on a range of subjects, including the company’s products, innovation, financials, leadership, strategy, the way it looked after its people and its approach towards sustainability.  We called it a Reputation Audit and the results, when presented to Board Directors and the Senior Management team, divided the room. The room was split between those who were more accustomed and exposed to wider stakeholder perspectives, and those more comfortable with financial balance sheets. The former immediately saw the strategic and reputational value of engagement, while those focused purely on financial performance took longer to be persuaded. However, the combination of qualitative and quantitative data was critical in provoking meaningful discussions that, ultimately, informed a change in strategy and aided decision-making. Sustainability was one particular aspect which was elevated to being a key strategic driver for the business in question and has continued to be so.

15 years on, the opportunity to engage with stakeholders on behalf of clients and provide meaningful content for conversations in the Boardroom remains one of the most interesting parts of our job. Our experience tells us that the most impactful stakeholder audits, be they wide-ranging (as detailed above) or more tailored, such as sustainability-led materiality assessments, combine quantitative data with in-depth qualitative insight. Numbers can reveal patterns, but only personal conversations reveal how and why those patterns matter. Faceless online surveys or AI-generated analysis serve a purpose, but they can only go so far. They cannot replace the context offered through genuine dialogue.

When the revised UK Corporate Governance Code was introduced, we asked Boards to consider two simple questions:

• Are the interests of the workforce and stakeholders being regularly presented to the Board and linked to key performance indicators?
• Is the data robust enough to analyse and measure the results of decisions made by the Board?

Those questions remain as valid as ever – and during these uncertain times, arguably more so.

Whatever the regulations or reporting requirements are in the future, stakeholder engagement is a critical business tool and should be carried out, or refreshed, regularly. It is not a compliance exercise or a hygiene factor; done well, it can deliver confidence, resilience and long-term value to an organisation.