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Is a community stakeholder crisis crippling your business reputation? Asks Jhon Arokiasamy, COO of Good Relations India

17th September 2014


The Issue

The economic liberalisation has led rapid growth for the Indian industry as well as highlighting the need for expansion into newer territories both within Indian and abroad meaning challenges are present from entry till exit.

India’s colonial past and the growth of multinationals perhaps has brought about a sense of uncertainty among the population regarding the mighty large organisations wanting to establish their presence in their locality, resulting in a serious communication challenge for those businesses.

The expression and visible outcome of the vulnerabilities within a project are often noticed through all stages of establishment. Some of the outcomes include protests, physical destruction, political interference, legal issues and so on. One might assume that these apply only to organisations in the manufacturing sector, but an in-depth study on the conduciveness to sustenance of business operations is required for all other sectors as well. The issues that need to be looked into vary based on the nature of organisation.

The Narendra Modi government has signalled easier green permits for projects and a dilution of the Land Acquisition, Rehabilitation and Resettlement Act (LARR), 2013 which was expected to look after the rights of farmers, landowners and displaced people. This will only sharpen the struggle between the local community and big businesses.

The conflict seen between organisations and the locals, the two critical stakeholders, is a problem not just for each other but also for the governments which have embraced an aggressive strategy of economic growth.

The organisations that have faced business continuity issues both at the project commissioning and at the commencement stage are aplenty. Posco in Orissa, Tata is West Bengal, and Nuclear Power Corporation of India Limited in Tamil Nadu and Maharashtra are some of the classic cases of community conflicts that all stakeholders have grappled to resolve in vain.

The Solution

One of the primary reasons for the rise of unresolved conflicts has been the failure of organisations to identify and address the community level issues of the areas they wish to invest in right at the early stages. Rather than adopting an appropriate long term mutually co-existing harmony they resort to quick-fix approaches that don't deliver in the long run.

The mapping of stakeholders and issues which could potentially occur at different stages, along with an audit on the quality of social engagement and a comprehensive vulnerability study undertaken at different phases of a project commencement by project teams need to be done.

There have been several instances of organisations which have set up operations hurriedly and invested heavily, but not set up effective social engagement, resulting in a stage of closure due to sever opposition which cannot be managed.

What’s more, these organisations can neither afford the social reputation re-engineering required across different levels after the damage is done nor do they have the wear-with-all to sustain the on-going battles of conflict that paralyses the entire business environment.

Rural India is mostly dependant on agricultural sustainability. Locals have huge insecurity when fertile agricultural lands are taken away from them. When livelihood issues are identified, organisations could adequately take measures to reduce the fears and constantly engage with them. Treating the locals with respect, harnessing the local resources without much collateral and ecological harm, smooth relocation, provision of employment opportunities and infra-structural development and on-going healthy social engagement and communication are some of the available options to handle some of these fears.

Political stakeholders driven by their ambitions try to sway the locals in their favour to drive their agenda. Hence, identifying these stakeholders and predicting the kind of issues that could arise out of their selfish motives will help address them according to the levels of operational sustainability. Maintaining a satisfactory relationship with them is essential, to ensure that they co-operate with the organisation for its business conduciveness.

Jhon Arokiasamy is a crisis communications consultant and COO of Good Relations India.


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