Stakeholder capital: a catalyst for business success
Stakeholder management is the route to creating shareholder value.
We are living in a world of radical information transparency and instant mass communications capability.
The former means that what happens in a far-flung corner of a company’s operations can now be detected and analysed by any number of affected or interested parties. The latter means that any resulting critiques of corporate malfeasance can be easily transmitted, via social networks, to global audiences. This transmission is now instantaneous, cost-free, and frictionless.
Today, it is not a question of whether companies need to engage stakeholders,2 but how. In today’s world there is simply no place for a company to hide.
Inflection Point Capital Management’s core investment thesis is our belief that a series of powerful secular global megatrends, combined with the accelerating velocity of change in global markets, is creating an entirely new set of alternative risk/return drivers and competitive imperatives for companies. Two of the most important of those megatrends are the dramatic increase in both stakeholder standards and power, and the unprecedented information and communications tools with which they are now equipped.
The way in which a company manages its stakeholders is a powerful indicator of the overall quality of its management.