Stakeholder Engagement – No Longer an Option

Sandy Nessing

Sandy Nessing

There are many ideas about what stakeholder engagement is, how it works and whether it even makes any difference at all. The problem is, stakeholder engagement has become as much a buzz word as sustainability. But don’t underestimate its business value.

At AEP, we started a formal stakeholder process about four years ago. Many in management thought we were nuts to organize face-to-face dialogue with environmental groups; I mean, we are one of the largest coal-burning electric utilities with a legacy of opposing the Clean Air Act. It was an uncomfortable conversation but it was the start of a transformation of how we operate as a business.

Stakeholder engagement  builds trust, credibility and political capital, and it requires a commitment to honesty, candor and transparency. The purpose is not to agree on everything; in fact, that would be pointless. Rather, it’s a way to open dialogue to seek common ground, listen to one another to gain a better understanding of where you stand and why, and use that insight to your mutual advantage. You’d be surprised what happens.

When I organized the first stakeholder meeting in early 2007 at AEP, it was like a boxing match. Stakeholders challenged; we defended; and when we took breaks, we each went to our own corners. We quickly realized, however, the opportunity and richness of engaging with others and the new perspectives it offered us.

Today, our formal meetings are standing room only and executives use it as a development opportunity for themselves and others.  Stakeholder engagement has transformed one-way communication into two-way communication, dialogue into working relationships and working relationships into partnerships. It is part of how we conduct our business today. We do it one-on-one, in groups, face-to-face and electronically. We do it with purpose and intent because we view engagement as a core competency.

The conversations are still tough and we often agree to disagree, but our stakeholders have made us stronger and more resilient. We like to think we’ve done the same for them.

About Sandy Nessing

Sandy Nessing is the Managing Director of Sustainability & ESH Strategy & Design for American Electric Power Co. Inc. She wrote and published AEP’s first Corporate Sustainability Report in 2007, and in 2010 published AEP’s first integrated Corporate Accountability Report, a combination of the annual sustainability report and Annual Report to Shareholders. Follow her on Twitter at @Watts4U.

View all post by Sandy Nessing »

  1. elaine cohen

    July 31, 2010

    hi sandy, great insight and a great example for others. Stakeholder engagement is one of the most significant areas which most companies, despite reporting on all other aspect of responsible practices, leave untouched. Well done on making such great progress.
    warm regards,

  2. casimonek

    August 8, 2010

    Sandy, what do you think are one or two things that you accomplished through stakeholder engagement that you feel you may not have been able to otherwise? Or perhaps a different perspective on a project? Some examples would really shed light to how powerful these engagements can be.

Leave your comment