Ethical Community Stakeholder Engagement in the Global Environment: Strategies and Assessment

Given the importance of and challenges in stakeholder engagement in the global context, this study examines the perceptions of local community members on the stakeholder engagement strategies of multinational corporations (MNCs) operating in Peru as well as the relationship outcomes of such engagement. A survey with 300 local community members in Cajamarca, Peru was conducted. Results indicated that among the different engagement strategies, symmetrical/ethical communication is the most critical whereas mediated communication is the least effective in increasing the effectiveness of stakeholder engagement for both stakeholders and organizations. In the process of stakeholder engagement, uncertainty reduction plays a more important role than anxiety reduction in increasing perceived control mutuality and trust. Appropriate stakeholder engagement strategies and stakeholders’ anxiety and uncertainty management significantly predicted organization-stakeholder relational outcomes.