The purpose of this paper is to show how boards can get in touch with their value critical stakeholders, those who can make or break the company.
The paper first develops the hypothesis that boards often are out of touch with reality. It then introduces the concept of value critical stakeholders and proposes that boards introduce an outreach program to get in touch with them. For each of the proposed five elements in an outreach program, the paper reviews what boards already are doing to be in touch.
The review of existing practice shows that for each of the elements in an outreach program, there is enough practice available for boards to develop a comprehensive approach to get in touch with the value critical stakeholders.
To prevent a future governance crisis, get in touch and promote long‐term value creation, boards need an explicit program of reaching out beyond the boardroom, not only to the immediate stakeholders, but also the societal stakeholders, who can make or break the company. This paper shows how it can be done.
The paper introduces the new concept of value critical stakeholders and describes how it can be used to help boards get in touch with reality.
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