Integrating social impact management and stakeholder relations

Corporate social responsibility (CSR) is well developed in most established large organisations. Richard Parsons says the challenge now is to find a holistic approach that integrates both impact and relational dimensions of CSR.

As corporate social responsibility (CSR) has matured, many concepts and tools have been developed to help manage particular aspects of it. We now speak not only of CSR but also of social impact assessment (SIA), social impact management planning, stakeholder engagement, social licence, social return on investment, social accounting, integrated reporting, and materiality analysis. And that’s before we start talking about sustainability. Perhaps this is a sign that we now understand CSR more deeply, as we seek to understand its every nuance.

Yet this fragmentation risks a situation in which we select only the tool(s) we are most comfortable with and ignore others. These choices signify how we conceptualise the social dimension, choices that may overlook or downplay “difficult” aspects of CSR and stakeholder relations. Arguably, it is no longer necessary for practitioners to reflect deeply on their organisations’ moral responsibilities and relationships with societal groups, as long as they know how to navigate an impact assessment that satisfies regulatory requirements.

Perhaps the dominant characteristic of CSR nowadays, therefore, is its technocratisation, as exemplified by efforts to recast it in tangible, manageable and measurable terms. The problem with management by technical experts is its tendency to reinforce existing power relations – rather than seeing new ideas and dissenting voices as opportunities to challenge our own assumptions and reinvent our practices, we absorb them into familiar ways of doing things. It also can lead to a compliance-driven mentality that focuses on satisfying bureaucracies rather than building lasting relationships of trust.

As the saying goes, “what gets measured gets managed”, implying that if it’s not measured it cannot be managed. Yet much of the social world is messy, complex, intangible, and constantly changing. Trying to measure the unmeasurable may be to deny its multiple layers of meaning – yet still we must find a way to manage it.

This leads to the realisation that a holistic approach to CSR must involve both impact and relational dimensions.

The importance of integrating impact and relational dimensions of CSR became apparent in a recent project to document stakeholder perceptions of the social impacts of a coal-seam gas operation in Queensland, Australia.

When discussing tangible impacts such as groundwater pollution, stakeholders appeared to attach as much significance to communication processes around those impacts as they did to the impacts themselves. In other words, their perceptions of impacts derived not only from actual or potential loss of amenity, for example, or degraded water quality, but also from the level of respect with which company staff treated them, the extent to which they were able to influence decisions, and the level of trust that they felt towards the company. Experiences of these relatively intangible processes substantially influenced how they perceived the impacts themselves.

Relationship processes underpin the social licence concept. The implication, then, is that stronger integration of relationship-oriented social licence considerations would significantly enhance understanding of social impacts.

The International Association for Impact Assessment (IAIA) defines impact assessment as “the process of identifying the future consequences of a current or proposed action”. Perhaps this definition inadvertently focuses effort on outcomes (consequences) rather than on processes of identifying them. In practice, identifying consequences requires deep and broad engagement with stakeholders – a relational process. Careful reading of the IAIA definition clearly indicates that holistic, participatory practice of impact assessment is about these complex, intangible, and often time-consuming relational processes at least as much as it is about developing lists of impacts and mitigation strategies.

This may be achieved by incorporating relationship concepts associated with social licence, such as trust and perceived influence, alongside tangible impacts in impact assessment frameworks.

The IAIA journal, Impact Assessment and Project Appraisal, published a special issue on the social licence to operate and impact assessment in September 2014 (Vol.32, No.4), edited by Dr Sara Bice (University of Melbourne and ACCSR Senior Associate) and Dr Kieren Moffat (CSIRO). It includes papers by ACCSR Senior Associates Dr Robert Boutilier, Dr Sara Bice and me.

This article first has been published on the ACCSR blog and is republished with the permission of the author.