Stakeholder Capital defines the strength and quality of the relationship between a company and its stakeholders. Experience has shown that a high degree of Stakeholder Capital allows the firm to secure its permits, pursue its business objectives and successfully weather a crisis.
Consider a recent Wharton School study of the mining industry:
“There is a powerful business case to win the hearts and minds of external stakeholders. We found in our research that the value of the relationship with politicians and community members is worth twice as much as the value of the gold that the 26 mines ostensibly control.”
Insufficient Stakeholder Capital results in unclear regulatory pathways, increased likelihood of third-party legal intervention and barriers to new markets. Stakeholder Capital is a resource that is only created through investments of time and energy. It is a strategic component of any successful business. We help clients achieve their business goals by developing, maintaining and leveraging their Stakeholder Capital. To learn more, contact us.
*Henisz, Witold J., Sinziana Dorobantu and Lite Nartey “Spinning Gold: The Financial and Operational Returns to External Stakeholder Engagement” Strategic Management Journal. Submitted July 1, 2011.