Making the move from a ‘Shareholder’ to ‘Stakeholder’ mindset

In recent years, businesses have focused on creating shareholder value, prioritising financial returns for its owners and investors, who put in their money and time - sometimes, quite a lot. 

All arrows point to profit, and success stems from shareholder satisfaction.

So far, so sensible… right?

The thing is, though, while owners and investors are shareholding stakeholders, they're not the only stakeholders. There all sorts of internal and external, direct and indirect stakeholders contributing to a business's success and resilience long-term.

Take the 2020 pandemic, for example, and all the unforeseen challenges - it showed us the importance of strong supplier relationships, the value of community support, the reliance on natural resources, and the need for agile minds to power all those 'pivots'.

However intangible they might seem, loyal suppliers, communities, the environment, our education systems, infrastructure and more, are part of a business's long-term success and support system. The 'unsung' network of multi-level stakeholders who walk beside it into the future. Without them, businesses collapse along the way - big ones, too. 

From pandemic risks to climate, health and resources, a business is only as good as its awareness and care of everyone and everything it needs to work, of all its stakeholders. Making the shareholder to stakeholder shift requires relationships that stretch beyond financial returns.

Here are five key things to think about when building a supportive stakeholder network:

1. WHO ARE YOUR EVERYDAY STAKEHOLDERS?

Everyone involved in the business's day-to-day activities has a stake in its success - owners and investors, naturally, but also employees, team leaders, suppliers, partners, clients and customers. Their ongoing loyalty and wellbeing contribute to it, so it pays to check in and make sure they stay in place.

2. WHO ARE YOUR UNEXPECTED STAKEHOLDERS?

The number of people outside a business who are interested in how it is run is growing. Governments, councils and banks are increasingly allocating funds and training to forward-thinking companies. Investment expectations are expanding far beyond profit alone. And communities are becoming very vocal about the businesses they admire (and those they don't), because business decisions now so clearly affect them. 

3. WHAT'S THE ONE STAKEHOLDER YOU CAN'T IGNORE?

The environment. Even from a hard-nosed, old-school business perspective. Literally every single aspect of our activity at all levels connects and exists within it.

And if we push it too far, it certainly won't function in our favour.

4. DO THESE STAKEHOLDERS HAVE A VOICE?

Once you recognise which stakeholders make up your network, then it's about listening to them. Do you circulate employee satisfaction surveys with your team? Do you talk to your suppliers regularly? Have you consulted with environmental experts? Focus groups, community consultations? The more human the relationships, the more opportunity for creativity, collaboration and compromise - and securing long-term support.

5. DO THESE STAKEHOLDERS HAVE A SAY?

This is the crux of it: it's one thing to listen to stakeholders, but another to act on their input or expertise. If a significant social or environmental concern is raised that might affect a project in its current form, what happens? Can it be vetoed, to be revised and improved, or could it carry on regardless? Ultimately, this is the difference between a business paying lip service and authentically pursuing positive change.

When a supportive stakeholder network is factored into business plans and success measures, it secures its ongoing wellbeing, which secures the business's ongoing wellbeing - even if it doesn't translate into profit straightaway.

While it might seem savvy for a business to squeeze costs and steamroll concerns short-term, it's only damaging its own support systems long-term, and increasingly, any potential for investment, government or customer support. 

On the other hand, making that shift shows that business leaders have foresight, and have factored in their responsibilities and risks, ensuring that everyone - and everything! - they need and impact through their business has a place at the boardroom table.