Stakeholders within a nonprofit setting are a diverse and essential group that includes funders, volunteers, clients, referral agencies, and government officials. They all have an interest in how agencies provide service delivery and have ideas regarding how to implement them better. The commonly adopted definition of stakeholders has been introduced by Freeman (2001, p. 46) to be “any group or individual who can affect or is affected by the achievement of the organization’s objectives.” Since nonprofit organizations have an essential role in society, it is important to explore the ways stakeholders are invited in and supported to provide better ways to strengthen the performance of nonprofit agencies, programming, and services. To be able to improve stakeholder relationships, nonprofit agencies need to ensure that the stakeholders’ interests, needs, and opinions are valued and heard. Since stakeholder relationships are crucial to all kinds of organizations, it is important to note that without stakeholders they cannot do their business. Good stakeholder relationships require knowledge of stakeholders’ needs and interests. The objective of developing this particular framework is to strengthen the relationships between stakeholders and the overall agency. By exploring the stakeholder theory which revolves around the concept of stakeholders, this paper outlines a model of stakeholder engagement that will ensure programming for the community is reflective of the communities needs. It will outline the timeline, expected outcome, goals, critical activities needed to build trust and transparency while sustaining a strong presence in the community.
Model for Stakeholder Engagement
Design a structure or model for stakeholder engagement that depicts your timeline, expected outcome, strategic goals, priorities for action and key activities (include a table, diagram or graphic to visually illustrate the structure).
Step 1: Purpose of the Plan
The objective of this model of engagement is to ensure programming for the community is reflective of the needs. Therefore, a vital component of this action includes building trust and transparent relationships while maintaining a strong presence in the community. My vision of stakeholder engagement in my work would involve two-way conversations and honest information exchange. I find that the clients, employees and the communities that we serve can provide a vast wealth of information regarding how to truly create an impact in the community. By providing an open and honest exchange, it can reveal potential roadblocks to programs and initiative early in the planning stages that can assist with transforming objectors into strong allyships that can permanently remove blind spots that might arise at the early development stages. Leslie (2015) discusses two-way communication as a chance at building a network with stakeholders that I find to be such an invaluable tool in implementing this engagement plan.
Step 2: Establishing Requirements through Stakeholder Engagement Principle
The agenda behind most nonprofit organizations is the understanding of a shared vision and universal mission. Without these critical elements of social capital, nonprofits cannot be effective in achieving their missions (King, 2004, p. 483). By practicing a principles-based approach to stakeholder engagement activities, it enables nonprofits to define principles that clarify the purpose of engagement with stakeholders while guiding how that engagement occurs. The principles represent the agency's continuous commitment to work collaboratively with stakeholders, learning from their past experiences and continuing to focus on improving the overall performance.
The core principles of this engagement plan are as follows:
Principle 1: Stakeholder Engagement may require varying approaches for different stakeholders or different objectives.
Principle 2: Stakeholders should be engaged early by remaining open and transparent while allowing for the appropriate amount of time for stakeholders to engage in genuinely through providing input into policies or program decisions implemented by the agency.
Principle 3: Stakeholder Engagement must use existing structures or relationships engaging stakeholders particularly Pretty’s (1995) typology of interactive participation. Pretty's typology allows the multiple arrays of stakeholders to positively contribute their vast wealth of information regarding how to create meaningful impact in the community. In addition, this approach is an excellent way of keeping organizations mindful of Marsh and Kennedy (2018) key question: "Is your focus on needs or wants?" (p. 15).
Principle 4: Stakeholder Engagement must be employed consistently across multiple communications paths for a continued period to achieve its intended outcome and effect.
Principle 5: Stakeholder Engagement must be conveyed through a deliberate and coordinated Stakeholder Engagement Action Plan
Principle 6: Stakeholder Engagement staff should provide information that is clear, relevant and timely while recognizing the varying communication needs and preferences of different stakeholders. Effective communication with stakeholders within this context involves listening and talking.
Principle 7: Stakeholder Engagement staff should measure and evaluate the agencies engagement activities to understand what is useful, and improve the quality of the agencies stakeholder engagement over time.
Step 3: Identification of Stakeholders in a nonprofit context
Freeman’s (2001) definition of stakeholders acknowledges the existence of various entities to claim stakes in an organization, amongst them includes customers, suppliers, and employees (p. 4). While these classifications reflect a corporate bias, Freeman debunks this myth by clarifying that stakeholder theory is more about “process and procedural justice” rather than the distribution of economic outputs (Freeman et al., 2010). This suggestion allows for nonprofit organizations to be represented within stakeholder theory by focusing more definite identification of issues, capacity, goals, plans, and actions (Leslie 2015, p.28). Within literature, “stakeholders” are primarily viewed as people or entities to whom nonprofits are accountable. Key stakeholders include funders, volunteers, clients, referral agencies, and government officials, among others to whom nonprofits are responsible for explaining what they have done or have not done. Therefore, nonprofits' accountability as an agency is increasingly imperative. The communicative challenges lie in attempting to engage clients, funders, board members, etc. while meeting all of the varied expectations of stakeholders. Understanding nonprofit accountabilities is an essential component. Once the importance of accountabilities is understood, nonprofit agencies will be able to engage the needs of stakeholders by successfully addressing each varied group through their own communication. Since the stakeholders do not affect financial outcomes of the programs, it is understandably challenging to establish and coordinate stakeholder communication. Thereby, using two-way communication, Leslie (2015) explains that it “forms the foundation for drawing people in to think together and collaborate toward sustainable solutions to complex issues” (p. 8). The corporate social responsibility approach to stakeholder theory emphasized the role of these stakeholders in a corporate context, but since stakeholder groups in nonprofits do not impact the organization's bottom line they still drastically impact the success of a nonprofits ability to achieve their goal of social change. The use of engagement processes such as two-way relationship focuses on the way that stakeholders and the organization work together to build a collective future that is both mutually desirable and beneficial.
Step 4: Stakeholder Engagement Plan
Stakeholder Engagement activities must accurately reflect the positive aspects of agencies performance. It is understandable that stakeholder engagement cannot target all stakeholders on every issue, but it is essential to keep transparency a key focus. The objective of the engagement is to secure the desired outcome and effect while ensuring the agencies mission and objective remain at the forefront at all times. It is essential to focus on the right issue(s) and stakeholder(s) to achieve the best strategic outcome guided by agencies objective and targets. Stakeholder Engagement entails thoughtful analysis of the issue, which by default requires an understanding of the stakeholder’s stance on that issue. This process can be conducted in five steps:
|Goal||Stakeholders||When to Use||Tools||Involvement Timeline|
|Inform||Employees||Provides clear, balanced information to assist in understanding the needs and issues of the community through dialogue.||Newsletters, advertising, fact sheets, FAQs.||Every 6-12 months|
|Consult||Clients, Volunteers, referral agencies||Utilize the knowledge and needs of the community to gather information from a variety of stakeholders.||Community surveys and outreach, public forums.||Re-occurring meetings (ongoing) 1:1 Check-Ins as needed|
|Involve||Volunteers, clients, referral agencies||Collaboration from stakeholders ensures issues and concerns are understood and considered.||Advisory Council, ad hoc committees, one-on-one consultations.||One-time events, presentations, workshops, webinars, story projects, etc.|
|Collaborate||Volunteers, clients, referral agencies, and government officials||Working together in the decision-making process and incorporating recommendations into the decision.||Advisory Council, ad hoc committees, one-on-one consultations.||2-6 meetings|
|Empower||Staff members, volunteers, clients, referral agencies||Actively engaging with stakeholders and sharing final decision-making.||Advisory Council, ad hoc committees, one-on-one consultations.||2-6 meetings|
Figure 1. Stakeholder Plan
The above stakeholder engagement model provides an effective system for stakeholder engagement within a nonprofit context. The model views participation as a learning process that can allow agencies to maintain structures and resources (Cornwall, 2008). The model allows for emerging leaders such as myself to create a space that welcomes but also supports processes that can help build capacity, nurture voice and enable people to empower themselves — this clear plan for engagement emphasizing the importance and the apparent importance of stakeholder participation. This framework can be especially valuable because it allows for the transference of ownership from the clients that come in to access services to become instrumental in providing solutions to improve their access to services (Cornwall, 2008). By welcoming interactive participation, this can impact my practice because it allows for authentic engagement that moves “far beyond events and information dissemination to creating opportunities for stakeholders to deliberate through dialogue and do meaningful work to improve the learning environment and promote improvement" (Leslie and Taccogna, 2015).
Step 5: Key Activities for Stakeholder Engagement
When discussing the critical activities of this stakeholder engagement plan, I purposefully integrated Kant’s diction of “treat(ing) persons as ends unto themselves.” The philosopher discussed the importance of treating humans as an end in themselves and not as a means to something else. This rationale was essential while drafting the plan because it emphasizes the fact that humans regardless of their relation to the agencies outcome are a valued part of the overall engagement plan. All stakeholders have value, and that is important to the core values of any nonprofit agency. Freeman discusses the value of this approach by reminding the audience that it should come as no surprise that people respond well to such respectful treatment regardless of their position to the organization whether they are customers, management, employees or members of the community (Freeman, 2001). This statement governs all activities because it is a constant reminder that every single stakeholder should be respected. Since the goal of the plan is to ensure programming for the community is reflective of the needs, it is therefore vital to acknowledge the human value as a component of this action plan. The principal activities of my plan requires: prioritizing whom to engage, determining the goal and then establishing communication.
Prioritizing whom to engage
The first step of the engagement process comprises identifying the stakeholders that ought to be the focus of the agencies engagement efforts over a specific period. Considering the reasons, benefits and strategic alignment for engaging with the stakeholder, e.g.:
- Why should we engage with the stakeholder?
- What do we desire to achieve from this engagement?
- How does this engagement align with our strategic objectives, goals and obligations?
Determining the overall goal
The second step of the engagement process involves determining the impact of the overall program by engaging in the various levels of engagement with stakeholder to ensure that the program will provide resources and services to enhance the overall community. As a means to include Freeman (2009)’s statement regarding human quality comes forth when working with stakeholders to ensure the program adds value while ensuring the collaboration of ensuring that everyone involved is working in the same direction towards a common purpose. Through stakeholder engagement, we can obtain the opportunity of achieving new ideas, diverse perceptions, problem-solving skills, trustful relationships, and community engagement. While working toward Freeman (2009)’s theory of “value-creating activity”, representing value creation at the stakeholder level is when community members allowed to be involved into the process of determining which programs can truly benefit their needs and enhancing the social capital of the agency while reducing the stigma around the idea that community members cannot improve or add valuable input to community development. Through this stakeholder engagement model, it allows for accountability, ethics and the maintenance of public trust to ensure harmonious interest and placing more significance on building trust and creating value for the stakeholders. Lastly, it would elicit the “knowledge, emotions or spiritual commitment through valuing stakeholders and empowering them as individuals” (Greenwood, 2007, p.316)
The power of voice for stakeholders gives value towards the intersection of interests (Freeman, 2009). Within a nonprofit context, communication often fails because it is actioned too late. By engaging with stakeholders early, it allows the fruition of programs to operate successfully and with limited resistance. Communication can be established by understanding the right format to engage hence the emphasis of informing, consulting, involving and collaborating. I envision through this process that it would promote and encourage stakeholders to share their ideas, perceptions, and thoughts while allowing for the existence of a homogenous community based on trust. As Leslie (2015) stated “authentic engagement is empowering” (p. 1). Consequently, this will allow for building rapport and creating transparency.
Step 6: Monitoring, Evaluation and Reporting Back
Practical community engagement requires ongoing monitoring, evaluation and reporting back. It is essential to understand the tools and tactics established in the plan are useful. In order to determine the effectiveness of this plan, this would entail asking probing questions such as what could have been improved and the lessons learned to ensure that this plan can help achieve the overall designated goal and objective. By including monitoring, evaluating and reporting to the stakeholders in this process, it helps stakeholders understand how their feedback and ideas contributed to decision-making.
Enhancing Stakeholder Communities Using the Engagement Model
This framework will improve the stakeholder communities because it emphasizes on the comprehensive, multi-stakeholder approach to support and strengthen communities by involving stakeholders to ensure that the programs facilitated by the agency will provide resources and services to address the effects of unresolved trauma such as violence, poverty, homelessness, social isolation, and racism. These efforts include community building by establishing programming that can help strengthen and actively work towards a common purpose of improving the overall community. By using practices such as SAGE in parallel with trauma-informed service delivery, it will provide opportunities through dialogue to help stakeholders develop a deeper meaning for shared understanding of the bigger picture, assure multiple diverse perspectives are heard, understood and respected, guide participants through democratic processes to determine underlying assumptions and to exercises control over the group by empowering them to think collectively (Leslie, 2015). This framework also purposefully allows for all stakeholders in the agency to have a chance to vocalize their needs and ensure that the common interest continually remains at the forefront. By realizing, recognizing and responding to each stakeholders’ experience, this framework works to creates a space that is safe, trustworthy/transparent but also empowering participants voice and choose to contribute. The action plan facilitates insight to help stakeholders view themselves within the organizational context but also help them determine how they can play a crucial role in advancing the organization’s mission. By proactively identifying any potential barriers that may impact integrating stakeholder involvement (Cluzeau, 2012), this plan takes time to create the space for conversations with the deliberate intention of creating and promoting trust and respect where participants can speak – and be heard – without any fears while maintaining effective stakeholder engagement through exploring collaborative engagement.
Obstacles in Implementing Engagement Plan
Stakeholder engagement not only improves the chances that we get better ideas about how to improve and implement programs based on the communities needs, but it is more likely to help own the problem and then the solution so that improvement plans can be implemented. The potential obstacles that could be faced while implementing this engagement approach included: ensuring fairness, ensuring representativeness, and avoiding disillusionment. Ensuring fairness - It is imperative to take into consideration the diversity of communities served while ensuring that the less powerful voices and groups are engaged and not marginalized. Ensuring fairness would require inclusivity of all community members including all ethnic-sociology backgrounds, people with disabilities, youth, non-English-speaking backgrounds and Indigenous people. Ensuring representativeness - A challenge that is inevitable would be ensuring that full representation of all members within in the community. Since this plan entails providing programming for the community, it is vital to ensure that all community members voices are heard are representative of the community. Katz (2007) outlines the fact that not all stakeholders can be engaged in programs to the same degree, but it would be essential to note do we ensure that the community members who actively participate for committees and also representative of all community members. For stakeholders to be representative of the wider community, it is necessary that they identify with the programs being proposed and have its interests at heart. Avoiding disillusionment - Stakeholders may become disillusioned if the stakeholder engagement process does not lead to an outcome that reflects their input. It is imperative that agencies take the time to help stakeholders understand the reasoning of any decision reached. It is crucial that people involved have a strong sense of understanding that something tangible and worthwhile will come out of initiatives.
In determining the best ways to improve outcomes in a community, this paper determines the reality that individuals are likely to differ in their opinions about where the community’s energies should be focused. By implementing this plan, it hopes to emphasize on the value stakeholder relationships have on nonprofit agencies while acknowledging that without their involvement nonprofits agencies cannot exist. By imploring stakeholder theory, this paper addresses how a nonprofit can successfully ensure community programming is reflective of the communities needs by involving them at the beginning of any program planning. It also realistically considers various challenges that can be met throughout the process but returns to the notion that by providing an open and honest exchange, it can reveal potential roadblocks to programs and initiative early in the planning stages that can assist with transforming objectors into strong allyships. To successfully build trust and transparency with any community, nonprofit agencies need to remember the humanity of all stakeholders by valuing their value. In this respect, community engagement and participation becomes crucial and necessary. In essence, good stakeholder relationships allow for two-way conversations and honest information exchange if this is successfully achieved than nonprofit agencies will be able to maintain trust and transparency while a strong presence in the community.
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- Carroll, A. B., & Shabana, K. M. (2010). The business case for corporate social responsibility: A review of concepts, research and practice. International Journal of Management Reviews, 12(1), 85-105. Retrieved from https://search.ebscohost.com/login.aspx?direct=true&AuthType=url,cookie,ip,uid&db=bth&AN=47582555
- Cornwall, A. (2008). Unpacking “participation”: Models, meanings and practices. Community Development Journal: An International Forum, 43(3), 269-283. Retrieved from https://www.researchgate.net/publication/31091334_Unpacking_'Participation'_Models_meanings_and_practices
- Cluzeau, F., Wedzicha, J. A., Kelson, M., Corn, J., Kunz, R., Walsh, J., & Schünemann, H.J. (2012). Stakeholder involvement: How to do it right. Proceedings of the American Thoracic Society, 9(5), 269-273. doi: 10.1513/pats.201208-062ST. Retrieved from http://www.atsjournals.org/doi/pdf/10.1513/pats.201208-062ST
- Freeman, R. E (2001). Stakeholder theory of the modern corporation. Perspectives in Business Ethics, 3(144), 38-48. Retrieved from http://academic.udayton.edu/LawrenceUlrich/Stakeholder%20Theory.pdf
- Freeman, R. E. (2009). Stakeholder Theory. Masters Seminars in Business Ethics [Video file]. Retrieved from https://www.youtube.com/watch?v=Ih5IBe1cnQw
- Greenwood, M. (2007). Stakeholder engagement: Beyond the myth of corporate responsibility. Journal of Business Ethics, 74(4), 315-327. Retrieved from https://search.ebscohost.com/login.aspx?direct=true&AuthType=url,cookie,ip,uid&db=bth&AN=26210808
- Katz, I. (2007). Community interventions for vulnerable children and families: Participation and power. Communities, Children and Families Australia, 3(1), 19-32.
- King, N. K. “Social Capital and Nonprofit Leaders.” Nonprofit Management and Leadership, 2004, 14(4), 471–486.
- Leslie, K. (2015). The Politics of authentic engagement: Perspectives, strategies, and tools for student success. Maryland, US: Rowman and Littlefield.
- Marsh, J. A. & Kennedy, K. E. (2018). What is 'meaningful' stakeholder engagement and how can we facilitate it? Leadership, 47(4), 12-16. Retrieved from https://search.ebscohost.com/login.aspx?direct=true&AuthType=url,cookie,ip,uid&db=ehh&AN=128789632
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