Stakeholder management: the new role of business diplomacy

Abstract

Purpose Stakeholder relations has been largely based upon a two-way public relations model. Along with this change, business diplomacy emerged as a proposal to renew stakeholder management. It is still uncertain if this proposal adds value to stakeholder management, which this study seeks to clarify. Design/methodology/approach Corporate representatives in charge of stakeholder management were invited to participate in an online survey measuring both public relations and business diplomacy activities. With a sample of 104 companies, factorial analyses were conducted on public relations and business diplomacy activities comparing model quality. Findings This study finds that public relations and business diplomacy activities share identity but not to the point of being fused and are thus different in nature. The best model showed three overarching functions (communication, influence and intelligence) implying that stakeholder management needs both public relations and business diplomacy. Research limitations/implications Findings suggest both public relations and business diplomacy research should be included in advanced stakeholder management studies. Practical implications By acknowledging the role that business diplomacy plays in stakeholder management, companies may place influence at the core of the renewed stakeholder management strategy to better deal with the increasingly complex business environment. Originality/value This study adds clarity to the role of public relations and business diplomacy in stakeholder management based on actual activities developed in organizations and reveals the underlying dimensions of communication, influence and intelligence.

Engaging universe 4.0: The case for forming a public relations-strategic intelligence hybrid

“…But, as specified by Galloway and Swiatek (2018), one needs to recognise and understand the controversial implications that characterise the complexity, diversity and scope of the multiple uses of artificial intelligence in public relations practice. And, as defended by Falcão, Ramalho, & Nobre (2020), on must not forget either the capacity for dialogue with stakeholders, thus leading to a three-dimensional application of the notion of intelligence in public relations, based on the activities of: "diagnosing public relations problems", "scanning the business environment" and "meeting with and advising senior management" (p. 3).…”

“…Examples of benefits would be: reducing the confusion of our new informational era, overshadowed by the risks of fake news (Arcos, 2018), or the contradictions arising from the implementation of artificial intelligence (Galloway & Swiatek, 2018;Panda et al, 2019;Pedreño, 2017;Sebastião, 2020;Zerfass et al, 2020); or strengthening the processes of active listening, decision-making and anticipating changes. Furthermore, as pointed out by Falcão et al (2020), this field of application is all the more relevant to address the problems of social appropriation of scientific knowledge, including challenges such as maximising the social impact of large research and innovation projects and the public funding of science. One illustration is how the European Union is pursuing its research and innovation framework programmes.…”

Compass for public/private management in turbulent times: corporate diplomacy

“…This nascent knowledge area turning into an innovative management practice (Falcao et al, 2020) has developed over the last decades, dealing with geopolitical and noncommercial risks in international relations by sharing social/societal responsibilities among government and business: the concept of Corporate Diplomacy. While both terms (Corporate Diplomacy and Business Diplomacy) have been employed, defined and distinguished (see Ruël et al, 2014), the general accepted usage seems to move towards Corporate Diplomacy (White, 2020;Mogensen, 2020;Egea et al, 2020;Gutu, 2019;Hoop, 2019;Kochhar, 2018;Manfredi-Sanchez, 2018;Cino and Fontana, 2019;Henisz, 2016).…”

The ideal blend of public relations and business diplomacy

“…Individuals responsible for managing stakeholder relations perform a range of different activities. Falcão et al ( 2020) explore the issue further in a study of such executives serving multinationals within a wide range of industries. A key aim of the work was to ascertain whether BD and PR are totally distinct functions, separate but with some overlap, or so similar that they are largely indistinguishable.…”

“…The review is based on “ Stakeholder management: the new role of business diplomacy”, by Falcão et al (2020), published in Journal of Business Strategy. Growth in the number and diversity of stakeholders demands that firms take a broader approach to stakeholder management.…”