Maja Pawinska Sims 23 Nov 2023 // 6:00AM GMT
LONDON — Corporate affairs can tackle the “grand challenges” facing society and unlock more financial, social and environmental value by adopting a “collaborative corporate” approach to working with a wide range of external stakeholders, according to new research.
Reputation and communications consultancy Headland’s first ‘Collaborative Corporate’ study, with systems specialist and behavioural scientist Dr. Ben Shenoy, suggests that tackling systemic challenges such the climate crisis, the rise of AI and social polarisation in partnership with other businesses and organisations can lead to improved relationships, reputations and, ultimately, revenue.
The research behind the report was conducted by Headland’s strategy, insight and planning team and comprised YouGov polls of 2,000 British adults and 500 opinion formers drawn from civil society, business, politics, the media and the third sector, as well as interviews with Headland clients and C-suite company leaders, and analysis of the most recent preliminary results call transcripts from all FTSE100 companies.
According to the agency, the earnings calls review showed that CEOs and CFOs are already proactively engaging with, on average, between three and four different systemic challenges, from supply chain shortages to the need for electrification. However, the wider public and opinion formers continue to see businesses as predominately self-serving entities. “Greater collaboration could help solve these challenges and reap reputational rewards,” the report states.
The YouGov polls found that 74% of British citizens think businesses fail to put societal issues alongside or ahead of their own profits, rising to 79% for opinion formers. In addition, nearly half of the public (48%) think businesses perform badly when it comes to collaborating with outside organisations, rising to 63% among opinion formers.
More positively, there is a clear upside for corporates that partner up, and the public is enthusiastic about the prospects of collaboration to help tackle systemic challenges: 60% think businesses are effective when working together; 60% when working with their consumers; 61% when working with local communities; and 51% when working with government.
Headland managing director Dan Smith, who co-authored the report, said the notion of collaboration had been part of the consultancy’s DNA since its inception, as it sought to break down silos between corporate communications, reputation management, public affairs, capital markets and regulatory communications, employee communications and consumer campaigning, but that the report was “the first time we’ve codified this thinking.”
“We wanted to put that idea of stakeholders collaborating into a modern context, through the lens of the complex challenges businesses are facing – if you’re thinking about reputation, you can’t just do issues management now,” he said. “Those ‘grand challenges’ – from climate change to geopolitics to AI – have the ability to erode business models overnight and require all parties to come together to collectively address them and navigate what’s going to be an incredibly choppy, volatile period for probably the next 10 years.”
But Smith said this approach was not merely an exercise in risk management: “If anything, we have an optimistic view, that we have the ability to meaningfully impact change if we accept the level of collaboration that will be needed from businesses and stakeholders.
“Corporate affairs directors have to lose some of their previous thinking about what they are doing. These challenges are manifesting day in, day out, whether in the annual report, investors raising the bar on ESG, dealing with vocal employees, activist customers on social media, the media asking questions about your supply chain and geopolitical tensions, or launching a positive change to the business. Leaning in more meaningfully, building deeper relationships, stretch collaboration and going in with an open mindset – that’s a different way to do corporate affairs.”
And Smith added that corporate affairs professionals needed to move from “ego-system thinking” to “eco-system thinking”: “Ego-system thinking is about the pitch, the commercial plan, engaging stakeholders enough to show transparency and give you a license to operate. Eco-system thinking is rolling up your sleeves and acting to address challenges and have meaningful and sometimes difficult conversations with stakeholders. It also means looking at trust differently, not as an objective of communications activity, but as an outcome of participating in a different way.”
Co-author Dr Shenoy is a visiting professor of psychological and behavioural science at the London School of Economics and has taught at Harvard, Cambridge, MIT, Columbia and Stanford business schools, as well as advising companies including the BBC, BP, Cisco, Daimler, Deloitte, eBay, e.ON, Google, HP, HSBC, Microsoft, NATO, Sony, Unilever and Walmart. He said: “Wake up today anywhere in the world and chances are you’ll be confronted with the symptoms of some of the complex, interlinked challenges that are disrupting life for all of us, whether you’re a CEO or a citizen.
“Some businesses are ahead of the curve and are ready for what comes next. The majority are in the process of either adapting or rethinking. Others remain tied to what has previously worked and driven performance. The ‘Collaborative Corporate’ explores the opportunities that exist in the space where ecosystems meet and overlap, within the wider system in which all businesses operate. Here is where business models can be reimagined, new partnerships built and fresh revenue streams created.”