Rationale for Stakeholder Management

CHAPTER SIX: Case Study One: Analysis of Results

Introduction (6.1)

Case Study Background (6.2)

Nigeria’s Federal Government PPP Procurement Process (6.3)

Rationales for Stakeholder Management (6.4)

Stakeholder Management Steps (6.5)

Roles of Partners in Stakeholder Management (6.6)

Enablers of Stakeholder Management (6.7)

Chapter Summary (6.8)

This section presents the findings of internal stakeholders’ rationales for stakeholder management and external stakeholders’ perceptions of internal stakeholders’ intentions for engaging them.

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6.4.1 Internal Stakeholders’ Rationales for Stakeholder Management

The internal stakeholders had rationales for managing external stakeholders. These rationales were: for regulatory compliance; standard practice of the organisation; to enhance project buy-in; and to build a partnership with external stakeholders. The Environment and Impact Assessment (EIA) Act 1992 makes EIA study compulsory. According to part 1, section 2(1) of the EIA act:

“The public or private sector of the economy shall not undertake or embark on public or authorise projects or activities without prior consideration, at early stages, or their environmental effects” (EIA Act, 1992).

In conducting the EIA for any project, a public sector official stated that:

“Stakeholder engagement is a requirement for EIA study” (Public sector official 3).

Indeed, EIA documents cited by the researcher showed that external stakeholders were engaged during the EIA study. Also, a feasibility assessment is required in developing PPP projects. According to the state’s PPP manual:

“The outputs of the feasibility analysis are drawn together into an Outline

Business Case, which provides the overall business rationale for proceeding with the PPP project” (Office of Public-Private Partnership, 2012, p.90).

The engagement of external stakeholders is required during the feasibility assessment or study. According to a public official:

“It [stakeholder engagement] is part of the feasibility study because you want to know first of all if the people want the service and if they want the service can they afford it?……… so that their views could be incorporated in the project” (Public sector official 1).

Moreover, there are different tasks that are undertaken during feasibility assessment that provide the platform for stakeholder engagement. One of such activity is the conduct of the Willingness to Pay (WTP) assessment. WTP was conducted:

“Indeed I was around and I was one of the respondents to the survey” (Community Rep 2).

The quotes above clearly indicate that the engagement of external stakeholders is mandatory and an intrinsic feature of PPP projects. In addition to regulatory requirements, stakeholder management is a standard practice of the SPV:

“I see it [stakeholder management] as a norm….it’s our policy to always carry the stakeholders along” (Private sector official).

It is important to note that the SPV’s policy of managing stakeholders is result oriented, aimed at achieving some goals. According to the SPV official:

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“Carrying the people along and making the people get that buy-in to the project is just what stakeholder relationship management is all about” (Private sector official).

The SPV official went on to explain that the importance of getting the external stakeholders’ buy-in to the project is to ensure the success of the project:

“If you want to thrive, if you want people to accept the project, if you want people to accept what you bringing which is new I mean the case of this project you have to carry the stakeholders along…... When you talk about stakeholders, you cannot rule out the host [local] communities because this is where the project is going to sit….. where you are going to make your money” (Private sector official). Further, internal stakeholders mentioned building partnership with external stakeholders as a rationale for stakeholder management:

“Whatever you want to do for people, you need to carry them along….. There should be a sort of partnership with them in order to have success of that project” (Public sector official 3).

The last two statements indicate that internal stakeholders recognise external stakeholders’ support as vital for the success of PPP projects. The chapter will proceed to present external stakeholders’ options for the rationale of internal stakeholders in engaging them.

6.4.2 External Stakeholders’ Options of Internal Stakeholder Rationale

The external stakeholders stated the following as internal stakeholders’ rationales for engaging them: for political reasons; for the economic survival of the project; and to lessen tension that arose due to protests. According to a representative of the community:

“They did not want to lose this part of the state” (Community Rep 1).

In addition to political reasons, the economic survival is another reason mentioned by the external stakeholders for internal stakeholders engaging with them:

“The engagement came just for the economic survival of the project rather than the infrastructural value that it will add to the community. It was not to the benefit of the community” (Community Rep 2).

Further, external stakeholders mentioned that reducing tension was internal stakeholders’ intention to engage with them:

“I think that from day 1, the committee was meant to douse tension” (Community Rep 5). The statements contradict internal stakeholders’ rationale discussed earlier and show external stakeholders’ negative perception of internal stakeholders’ rationale for engaging with them. Also, external stakeholders’ opinions depict the effort of internal stakeholders as not genuine.

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However, external stakeholders believe that building partnership with internal stakeholder is crucial:

“If we had been carried along very well and if it had been all inclusive and it’s our project, nobody would come and talk about cancelling it and all of those things” (Community Rep 2).

Similarly, another community representative commented that:

“Community can be part of the project when you carry them along” (Community Rep 4).

These statements indicate external stakeholders’ willingness to support the project had the internal stakeholders been proactive to partner with them.