Key issues and challenges in stakeholder engagement in sustainability reporting

Abstract

Purpose This paper aims to explore the key issues and challenges that can affect the quality of stakeholder engagement processes and outcomes in relation to sustainability reporting. Design/methodology/approach Case study research was used to gain in-depth insights into the stakeholder engagement practices of three Australian local councils. Findings The findings of this study suggest that the effectiveness of stakeholder engagement can be undermined by certain difficulties and challenges faced by an organisation. These include limited resources, lack of commitment from internal stakeholders, political factors, heterogeneous concerns, inadequate representation and an unwillingness to engage. Research limitations/implications The study adds to the limited literature on stakeholder engagement in sustainability reporting specifically and on sustainability accounting and reporting in public sector organisations (PSOs) more generally. Practical implications This research provides practical guidance to government authorities on the challenges that need to be addressed to enable an effective stakeholder engagement process for sustainability reporting. Social implications Stakeholders have a critical role in holding organisations accountable and research into their engagement with these organisations has societal benefits. Originality/value This research while focused on the Australian context has international relevance as it provides unique insights into the stakeholder engagement process. The implications of this research apply to not just PSOs but also corporations that are grappling with the (difficult) process of effective engagement with stakeholders.