Stakeholder face-off in the Facebook age: the board challenge ahead: Be better prepared to use the Web proactively and reactively to engage with your diverse constituencies.

• Author: Farrar, James
• Position: TECHNOLOGY

IN TODAY'S SUSTAINABILITY-CONSCIOUS WORLD, Communication needs of stakeholders have expanded beyond traditional reporting to include regular updates on corporate sustainability performance. Most companies address these expectations by summarizing their sustainability efforts in annual reports or at shareholders' meetings. While these traditional channels are useful, activities related to environmental and social issues mandate more fluid and dynamic dialogue with stakeholders.

Using technology to continuously engage and respond to stakeholders is one way of ensuring that dialogue occurs. Specifically, Web-based technologies--social networking sites, such as Facebook and MySpace, and corporate blogs and wikis--are becoming key communication channels for stakeholders to interact with each other and the company about sustainability issues.

A powerful tool

Sustainability reporting has moved into the mainstream, and should be managed as conscientiously as compliance with international accounting standards or SEC regulations. In fact, formal sustainability reporting frameworks like AA1000 and the Global Reporting Initiative require demonstrable, ongoing stakeholder engagement. Using collaborative technology is a cost-effective way to meet these demands while developing a more strategic stakeholder engagement process.

The Web's social networking capabilities make it more inclusive and immediately responsive than other channels, and thus an effective way to reach and influence groups about particular issues. For example, a Canadian mining company decided to sell its interest in an aluminum mine after fierce local opposition to its development plan was publicized on the Web, resulting in a global outcry. Similarly, the social networking site Facebook is frequently leveraged by communities who mobilize grassroots campaigns against business practices. Banking giant HSBC recently reversed a fee policy after a successful student protest was launched on Facebook.

Moreover, while enterprise software can use structured data to identify business risks, calculate resource requirements, and monitor performance thresholds, the Internet is invaluable in facilitating and capturing unstructured communication between stakeholders and the company. Companies can track the tone and direction of dialogue, synthesize the information and ideas exchanged, and refine their policies and practices accordingly. Ideally, the structured data and Internet (unstructured) data...