The Problem with Stakeholder Engagement: Why Many Need to Rethink Their Approach

Stakeholder engagement is more critical than ever, as organisations navigate regulatory pressures, increased expectations for corporate responsibility, and the rapid pace of global change. Yet, many businesses still rely on outdated methods that limit the effectiveness and authenticity of their engagement efforts. Recent studies reveal that over 80% of companies still use spreadsheets as their primary tool for managing stakeholder engagement, a practice that often leads to fragmented communication, redundant tasks, and data inconsistencies that hinder meaningful interaction . To achieve genuine stakeholder engagement, organisations must address several challenges: scalability, transparency, and cultural considerations.

The Scalability Challenge: From 1:1 to a Broader Audience

Direct, one-on-one engagement with stakeholders is undoubtedly important, allowing companies to tailor messages, address concerns personally, and build trust on an individual level. However, this approach is not scalable. When organizations grow or have stakeholders across diverse regions, one-on-one interactions become time-consuming and impractical. For example, a company engaging with hundreds of community leaders, government representatives, customers, and employees faces the daunting task of managing thousands of individualized interactions. This results in significant delays, inconsistent messaging, and, ultimately, disengaged stakeholders. The reliance on outdated tools like spreadsheets exacerbates this issue, making it nearly impossible to track progress, ensure accountability, or create a unified message.

Lack of Authenticity and Transparency

Transparency and authenticity are foundational to meaningful stakeholder engagement, yet they are often compromised. Some organisations may selectively share information or avoid addressing certain issues, fearing backlash or reputational damage. However, stakeholders today expect openness, and a lack of transparency can quickly erode trust. For instance, when companies avoid difficult questions or fail to address concerns raised by communities, employees, or customers, they risk appearing disingenuous. According to Edelman’s 2023 Trust Barometer, 88% of stakeholders believe companies should be more transparent in their business practices (Edelman, 2023). This expectation creates a need for platforms and practices that facilitate honest, two-way dialogue, where stakeholders feel their voices are genuinely heard.

Data Sovereignty and Respect for Indigenous Cultures

Another complex aspect of stakeholder engagement is managing data sovereignty, particularly when engaging with Indigenous communities. Data sovereignty emphasises the rights of Indigenous people to control and manage the data related to their communities, culture, and resources. Unfortunately, many organisations overlook these nuances, treating Indigenous data as if it were any other business asset. The improper handling of sensitive cultural data can lead to significant breaches of trust and result in the failure of engagement initiatives. A 2022 report by the First Nations Information Governance Centre (FNIGC) emphasizes the importance of Indigenous-led data stewardship to ensure cultural integrity and respect for community protocols. Without careful consideration of these factors, companies risk alienating Indigenous stakeholders and potentially damaging their relationships with these communities.

How Wizer Helps Transform Stakeholder Engagement

While traditional approaches to stakeholder engagement fall short, platforms like Wizer offer solutions to address these limitations. Wizer enables organizations to engage all stakeholders in real-time on a single, integrated platform, providing live updates and feedback mechanisms that support transparency and inclusivity. The platform’s tools ensure that every engagement is documented and monitored, enabling scalability and reducing reliance on outdated methods like spreadsheets. Moreover, Wizer respects data sovereignty by incorporating secure, culturally aware data management practices, giving stakeholders greater control over their information. With Wizer, organizations can foster more genuine, transparent, and respectful relationships, transforming stakeholder engagement from a challenge into a strategic asset.

By moving beyond spreadsheets and outdated engagement practices, companies can better meet the demands of today's diverse stakeholder landscape, fostering trust, collaboration, and sustainable growth.