The uncontrollable decisions of customers and shareholders are a business risk. Sir Nigel Knowles
discusses the importance of keeping good communication with an increased number of stakeholders.
Business Risk: Technology creating more stakeholders in companies
People now need to be far more prepared to communicate and in a transparent way in terms of their actions. Also we've got the interesting fact that someone might say something in one country, but it might be picked up in another country and interpreted very differently, giving the person making the statement a trust issues.
So life isn't actually going to be the same again. 10-15 years ago people might have described a corporate's stakeholders as being only the share-holders, but now stake-holders of a company are their suppliers, their employees, their customers, NGOs, regulators, the press and the government.
And a leader of the corporate has got to stand up and say how he or she intends to move the company along and then account to all the various stakeholders six months later, 12 months later and say how they got along, what happened.
They must account for any shortcoming, so trust and confidence go hand in hand and are now real important features of our life.
I think it is also understood that an individual can gain trust, and quite often a faceless corporation can lose trust.
But trust is an essential part of commercial life and actually if people trust each other and can make quick decisions and move things along very efficiently, trust can be a source of competitive advantage.
For more discussion on the business risk arising in the connected economy keep watching Connected Economy TV