Embed in management systems

1. Embedded commitment: The company has a policy commitment to ongoing stakeholder engagement, and embeds it in its governance, culture, and management strategy.​

Create a Tailored Engagement Plan​

2. Inclusiveness: The company listens to a full range of rights-holders across the value chain and has a process to identify legitimate representatives.
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3. A Focus on Those Most at Risk​:  The company prioritizes engaging with the rightsholders who are most likely to be harmed by its operations​, and therefore where early engagement is critical.​​

Conduct appropriate  activities

​​4. Informed Participation: The company establishes ongoing, two-way communication with affected rights holders that provides affected stakeholders with relevant critical information well in advance of key decision points.

5. Trust and Accountability: The company establishes procedures, tailored to the context, to build rights holder trust and accountability for its actions.​

Ensure follow through

6. Stakeholder-informed Action Plan: The company analyzes information obtained through affected stakeholder engagement and collaborates with rights holders to formulate an action plan.

7. Monitoring, Transparency, and Continuous Improvement​: The company establishes and maintains a transparent and stakeholder-informed monitoring and evaluation (M&E) system.​

effectiveness criterion 2

our approach

financial Materiality

Stakeholder Engagement Main Page > Four Pillars > ​Effectiveness Criterion 1

1. Embedded commitment​​​

The company has a policy commitment to ongoing stakeholder engagement, and embeds it in its governance, culture, and management strategy.

what this means

questions for portfolio companies

What to look for

For workers

High risk situations

Management should make a public commitment to undertake meaningful engagement with affected stakeholders, and embed this commitment into its core business operations. Embedding entails devising meaningful engagement procedures, integrating them into internal policies, objectives, and targets, and assigning senior staff clear responsibilities to ensure this commitment is applied across operations (TNFD 2023, 25–27; OECD 2017, 29; IFC 2007, 99–100). It should also set clear expectations with its suppliers and business partners that they do the same, and be prepared in high risk situations to engage with affected stakeholders beyond tier one of their value chain. Publicly communicating this commitment sets internal and external expectations and helps to drive accountability.

A rights holder viewpoint
When a mining company operating in Peru came to talk to the community surrounding the operations, community members sensed that the company’s representatives lacked both decision-making authority and much understanding of the local context. Their concerns were confirmed when the company later recommended cultivating a grain that was unsuitable for the region’s environmental conditions. This experience left stakeholders feeling that their time had been wasted and their input ignored.