AES Corporation Stakeholder Management and Engagement Guidelines

Transcription

1 AES Corporation Stakeholder Management and Engagement Guidelines

2 I. Objective The objective of these guidelines is to provide tools for AES businesses to develop strong Stakeholder Engagements that are suitable to AES businesses local contexts and equally beneficial for our core business and the sustainable development of the communities in which we operate. II. Applicability and Scope All AES businesses should follow these guidelines and contribute from their different areas of expertise to its application and continuous improvement. III. Content I. Introduction II. Stakeholder Engagement strategy i. Identification, mapping and grouping ii. Assessment and prioritization iii. Risk identification iv. Action plan and activities v. Engagement level and method vi. II. The stakeholder management tool III. Principles for Stakeholder Responsibility IV. Stakeholder Decalogue 2

3 Introduction In today s business environment, companies have to constantly adapt to information traveling fast, growing scrutiny from governments/media/public opinion and regulation uncertainty. Particularly, the energy sector is extremely complex and dynamic: quality relationships with stakeholders must be established early at all levels to ensure proactive, low profile and low cost solutions. AES as a public service company has a big responsibility and is more vulnerable to high expectations and scrutiny locally and globally. Stakeholder Management and Engagement refers to the process of developing strong, proactive and consistent relationships with key stakeholders of the Company. Supports the strategic objectives of the organization by identifying challenges, risks, and opportunities related to existing and potential AES business ventures; promoting public and private support for AES projects and reducing opposition to AES activities and encouraging a strong positive view of AES as a company with a commitment to safe, reliable, and sustainable energy solutions. Quality relationships with stakeholders must be established early at all levels to ensure proactive, low profile and low cost solutions Stakeholder Engagement strategy In conducting our business and improving lives in our communities, AES interacts with a wide variety of other people, organizations, governments and businesses. We consider all these groups to be important stakeholders in our business. Customers, employees, lenders and investors are also stakeholder groups with whom we want to maintain solid relationships. Partnerships and stakeholder engagement are fundamental to the company s global strategy. We strive to strengthen relationships through meaningful engagement with our stakeholders. We work to structure stakeholder engagement activities to be interactive so we can receive effective feedback. The environment of a business (market, politics, economics), the regulatory framework that are in place as well as a business value assessment in conjunction with the business objectives, determine what type of Stakeholder Engagement strategy must be pursued: business as usual, crisis / special situation, growth / expansion or new markets. 3

4 Every situation requires a different approach; however when developing the strategy: Get in early, don t wait until there is a problem to engage Take a long-term view, know what actions will obtain benefits useful in the short term and what the company needs for a longer term win. Manage it as a business function Be strategic and prioritize Be aware of the culture and issues that are sensitive locally Aim for a win-win whenever possible Determine if a highly-visible or subtle, quiet approach is best under the circumstances Developing comprehensive Stakeholder Engagement strategies and plans, that include a thorough stakeholder assessment, their impacts on our businesses, as well as the risks and triggers associated, would not only increase our anticipation and preparedness capabilities but also allow us to potentiate our competitive advantages to create win-win relationships. The creation of a Stakeholder Engagement strategy should follow the following process: Identification, mapping and grouping Once an overall strategy has been defined, the business must identify which are the key stakeholders that are involved and must be engaged as part of such strategy. This identification process should focus on the Stakeholders who may be impacted, have an effect, interest or can influence on the particular strategy. There are 16 main groups in which the stakeholders should be categorized (see table below). Businesses should focus not only on the groups but also stakeholders that could be within each group (see some examples on the table below). The final list will depend on the business, its impacts, and the current engagement objectives. 4

5 Community Employees Competitors Shareholders Media NGO Residents who live close by the operations Schools and other institutions Direct / Indirect Women Minority groups Disabled Indirect competition Global competition Trusts Mutual Funds General public Employees Radio Newspapers Television Social Media Customers Supplier Government Trade Association Residential Business Government and public institutions and facilities Fuel / Non-fuel supplier Direct / Indirect Local / National / International Executive Power Congress Local authorities Chamber of commerce Advocacy groups Think tanks Consumers union Environmental groups Human rights associations Financial Institutions Multilaterals Local / International banks Lenders Partner Union Regulator Opinion Leader Management Assessment and prioritization After identifying all the relevant Stakeholders, prioritize and determine which stakeholders are most valuable to engage with, and their relevance to the strategy. The assessment of each stakeholder must consider: The position or favorability regarding the strategy (against, in favor, neutral) The influence on the strategy The involvement on the strategy The interest or concern on the strategy. This is generally linked to the degree that the Stakeholder is likely to be affected by the issue/project When identifying, mapping and assessing the stakeholders, it might be helpful to consider the following: Who will be adversely affected by potential environmental and social impacts in the project s area of influence? Who are the most vulnerable among the potentially impacted, and are special engagement efforts necessary? What are the various interests of project stakeholders and what influence might this have on the project? Which stakeholders might help to enhance the project design or reduce project costs? Which stakeholders can best assist with the early scoping of issues and impacts? Who strongly supports or opposes the changes that the project will bring and why? Whose opposition could be detrimental to the success of the project? Who is it critical to engage with first, and why? What is the optimal sequence of engagement? 5

6 The assessment of each stakeholder will allow not only prioritization but also to graphically show the prioritization of stakeholders The process of engaging a stakeholder can be summarized as follow Risk identification Identify the risk scenarios that can potentially impact the strategy. Part of the risk identification must include the possible triggers or events that can result in the risk itself; this will allow proper anticipation and continuous monitoring of specific causes per risks. 6

7 Each risk has to be categorized in terms of: commercial community construction environmental financial Type Status Criticality legal operational political regulatory security Potential Active Closed High Medium Low Probability of occurrence High Medium Low Action plan and activities Determining which actions must be executed as part the strategy is crucial. The actions will be determined by all the aspects analyzed in the items above. The tailored action plan should include: Specific action What to do? Ways and methods How to do it? Stakeholders Who to engage? Timeframe When to do it? Responsible Who will do it? Engagement level and method There are many ways in which a particular stakeholder can be engaged and trough which AES can interact with the universe of stakeholders. The level(s) and method(s) of engaging with stakeholders should consider the purpose and scope of such engagement and to the relevant stakeholders. It also should consider the environment, local customs and the overall strategy s objectives. More than one method may be selected for any given engagement. Different methods may be used concurrently or sequentially. Stakeholder engagement is a two way process. However, there are different levels and associated engagement methods depending on the nature and extent of stakeholder involvement. Level of engagement Consult Limited two-way engagement: organization asks questions, stakeholders answer Negotiate Involve Two-way or multi-way engagement: learning on all sides but stakeholders and organization act independently Method of engagement Surveys Focus groups Meetings with selected stakeholder/s Public meetings Workshops Online feedback mechanisms Advisory committees Collective bargaining with workers through their trade unions. Multi-stakeholder forums Advisory panels Consensus building processes Participatory decision making processes Focus groups On-line feedback schemes 7

8 Collaborate Two-way or multi-way engagement: joint learning, decision making and actions Empower New forms of accountability; decisions delegated to stakeholders; stakeholders play a role in governance Joint projects Joint ventures Partnerships Multi-stakeholder initiatives Integration of stakeholders into governance, strategy and operations management Here is a list of examples of ways to engage stakeholders that are currently in place in AES businesses: 24/7 Customer call center AES People surveys Annual Investor Meetings Career fairs Collaboration with NGOs in facilitating policy making dialogues Company intranet OurAES.com Customer satisfaction surveys Customized energy management solutions Electronic newsletters Emergency planning exercises conducted with local/state agencies Employee Helpline Investor and public forum events Investor Calls Meetings with elected officials in communities surrounding power plants and utilities infrastructure Meetings with officials Participation in advisory councils, business alliances of NGOs, community events, public events Policy white papers, testimony and briefings Power plant tours Proxy communications Publications and reports Quarterly earnings presentations Rating Agency discussions Reporting in compliance with national and local requirements across the globe Residential customer education programs Traditional and Social Media Volunteer projects and financial contributions Website Wholesale and retail power and gas market participation Also include in the planning process activities and methods that are essential to engagement but are not themselves formal engagement methods and can be considered as pre-engagement activities. In this context, pre-engagement activities include: Pre engagement activity Receiving unsolicited information Stakeholder views expressed through: Tracking information Means Protests Letters/ s Media Websites Other advocacy efforts Media tracking Internet tracking Social network tracking Second hand reports 8

9 Creating awareness Bulletins, newsletters and brochures Websites Speeches and conference presentations Road shows Press releases Advertising and other public displays Lobbying Identify and prepare for engagement risks It is important to identify and address engagement risks. Engagement risks may include: Conflict between participating stakeholders; Unwillingness to engage; Participation fatigue; Creating expectations of change that the organization is unwilling or unable to fulfill; Lack of balance between weak and strong stakeholders; Disruptive stakeholders; Uninformed stakeholders; and Disempowered stakeholders. Make sure to have contingency plans to deal with the most likely or damaging risks. The owners of the engagement should understand the potential for conflict as fully as possible and should have detailed profiles available for facilitators. It is not always possible to engage with key stakeholders because of their unwillingness to engage. This may require an adjustment of the scope, purpose, level and method of the engagement. Full consultation may not be possible but it may still be possible to keep the stakeholder fully and transparently informed. In multi-party engagement it will be important to ensure the views of a key stakeholder unwilling to engage are included in the discussion and debate. Build Capacity of Stakeholders to engage The owners of the engagement and the stakeholders shall identify where capacity to engage needs to be built. The owners of the engagement shall work with the stakeholders to respond appropriately to these needs in order to enable effective engagement. Engagement processes are likely to involve a variety of people with different levels of expertise, confidence and experience. The owners of the engagement may need to address capacity gaps of stakeholders to avoid their exclusion or to prevent them from disengaging. Adequate capacity to engage can help to reduce engagement risks. Areas where capacity building may be relevant and beneficial include: Area Knowledge Build capacity Understanding and awareness of the issues, the organization, the local culture and politics. For example, understanding what the host country is legally obligated to 9

10 Skills Opportunity do as a result of bilateral or multilateral agreements (DR-CAFTA, BITs, EU requirements, New York convention on arbitration, etc.) Knowledge of relevant approaches to stakeholder engagement; and Understanding of the stakeholders involved and their perspectives. Language and communication skills; Ability to examine and interpret the outputs of stakeholder engagement in a way that captures the key facts and figures, as well as messages and insights; and individual personality traits such as integrity, ability to focus on solutions, motivation, and creativity. Availability of necessary financial and physical resources; Availability of time to participate; and Access to information in a timely and appropriate fashion. The owners of the engagement should consider the following when building capacity: Never assume common levels of knowledge and similar understandings of concepts be sure everybody involved understands the issues at stake; Provide enough time: stakeholders require time to understand new information and form opinions; good engagement also requires trust, which takes time to evolve. Communicate engagement outputs and action plan The owners of the engagement shall communicate the outputs and action plan to participants of the engagement in an appropriate and timely manner. It is important that reporting back to stakeholders is done in an inclusive and consistent way so that all participants receive consistent feedback. Reporting back could include a written report, but may be supplemented by: Stakeholder events; One-to-one meetings and conversations; Follow-up telephone briefings; and Providing access to information on web portals. Make sure to they keep a record of any queries raised and how the information has been revised. The stakeholder management tool AES has implemented a customized online platform for all AES businesses, to map stakeholders, risks, actions and capture feedback from stakeholders, to effectively manage each Stakeholder Management strategy. All of the aspects of a Stakeholder Strategy that were mentioned above can be capture in the tool to better anticipate and prepare for stakeholder risks. Some of the key functionalities include: Build comprehensive strategies along with stakeholder profiles and relationships between stakeholders Connect stakeholders to strategies, risks and actions/activities Create visual heat maps for a quick and easy overview of stakeholders assessments Keep track and issue reports for stakeholders, risks and triggers at multiple levels (strategy, country, SBU, Corporate, global) 10

11 Follow stakeholders social media activity in real time Capture feedback and interactions The tool can be accessed through AES internal website: 11

12 Continuous improvement The organization, with input from stakeholders, shall strive to continually improve its stakeholder engagement. It shall identify and act on specific improvements. The criteria in these guidelines provide the means to identify areas for improvement. This learning should be included in the design, planning and methodological guidance of future engagements. Principles for Stakeholder Responsibility 1) Bring stakeholders interests together over time. 2) Recognize that they are real and complex, with names, faces and values. 3) Seek solutions to issues that satisfy multiple stakeholders simultaneously. 4) Engage all of them in intensive communication and dialogue. 5) Commit to a philosophy of voluntarism, managing the relationship yourself. 6) Generalize the marketing approach. 7) Never trade-off the interests of one stakeholder versus another continuously over time. 8) Negotiate with primary and secondary stakeholders. 9) Constantly monitor and redesign processes to better serve stakeholders. 10) Act with a purpose that fulfills commitments to stakeholders. Act with aspiration toward your dreams and theirs Stakeholder Decalogue 1) Identify and listen to key stakeholders needs, views and objectives. 2) We do not need to like or agree with them, but we need to treat them right. 3) Always put yourself in others shoes. 4) Same message but different approaches depending on the objectives. 5) Be proactive and attentive. 6) Achieve a balanced satisfaction of all parties involved and be creative in developing win-win relationships. 7) You cannot please everybody, but you can still have good relationships. 8) Right balance on different perspectives. 9) Be prepared, have a contingency plan and control the story. 10) All politics is local. 12