Stakeholder Engagement in a Transition Context
Introduction
A just transition cannot be considered just unless those most affected are included in the process and have an opportunity to shape its outcome and process. Businesses navigating the transition to a low-carbon economy should engage stakeholders proactively, responsively, and continuously to understand their perspectives and concerns before making major decisions.
Stakeholder Engagement and Social Dialogue
Stakeholder engagement and social dialogue are related but distinct concepts. Stakeholder engagement involves interaction and dialogue between an enterprise and its potentially affected stakeholders, including workers, local communities, civil society organizations, government agencies, and others. Social dialogue refers to the process of negotiation, consultation, or information sharing between workers and management (bipartite) or workers, management, and government representatives (tripartite).
Types of Stakeholder Engagement
- Transition Out: Companies phasing out emissions-intensive assets need to manage the impacts on affected workers and communities. This involves deep engagement with those closely tied to the legacy business, focusing on risk mitigation, remedy, and creating lasting positive impacts.
- Transition In: Companies developing new low-carbon projects should proactively consult with potentially impacted groups to understand their perspectives, concerns, and aspirations. This process should build on established best practices while broadening engagement to include traditionally overlooked or excluded groups. Opportunities for benefit sharing and co-creation are key mechanisms for achieving a just transition.
Key Considerations
- Benefit Sharing: Ensuring that host and impacted communities and stakeholders receive economic, social, and environmental value from the project.
- Co-Creation: Fostering collaboration and innovation to address social risks and identify potential benefits.
- Cultural Identity: Respecting and incorporating the cultural identity of affected communities.
- Time Horizon: Considering short-term and long-term impacts of the transition.
- Transparency: Maintaining open communication with all stakeholders.
Stakeholders to Engage
- Labor: Workers and their unions.
- Community: Local communities and indigenous peoples.
- Business: Supply chain partners and other business stakeholders.
- Government: Local and national government bodies.
Conclusion
Comprehensive social dialogue and stakeholder engagement will enhance understanding of the perspectives and priorities of all stakeholders, which is foundational to ensuring a rights-respecting energy transition. Companies should focus on quality over quantity in their engagements and explore collaborative approaches to address potential stakeholder fatigue in regions with multiple energy projects.
Appendix
- Energy for a Just Transition Company Examples
- Topic Spotlight: Benefit Sharing
