Corporate Diplomacy

Corporate Diplomacy

Building Reputations and Relationships with External Stakeholders

Managers of multinational organizations are struggling to win the strategic competition for the hearts and minds of external stakeholders. These stakeholders differ fundamentally in their worldview, their understanding of the market economy and their aspirations and fears for the future. Their collective opinions of managers and corporations will shape the competitive landscape of the global economy and have serious consequences for businesses that fail to meet their expectations.

This important new book argues that the strategic management of relationships with external stakeholders – what the author calls "Corporate Diplomacy" – is not just canny PR, but creates real and lasting business value.

Using a mix of colourful examples, practically relevant tools and considered perspectives, the book hones in on a fundamental challenge that managers of multinational corporations face as they strive to compete in the 21st century.

As falling communication costs shrink, the distance between external stakeholders and shareholder value is increasingly created and protected through a strategic integration of the external stakeholder facing functions. These include government affairs, stakeholder relations, sustainability, enterprise risk management, community relations and corporate communications. Through such integration, the place where business, politics and society intersect need not be a source of nasty surprises or unexpected expenses.

Most of the firms profiled in the book are now at the frontier of corporate diplomacy. But they didn’t start there. Many of them were motivated by past failings. They fell into conflicts with critical stakeholders – politicians, communities, NGO staffers, or activists – and they suffered. They experienced delays or disruptions to their operations, higher costs, angry customers, or thwarted attempts at expansion. Eventually, the managers of these companies developed smarter strategies for stakeholder engagement. They became corporate diplomats. The book draws on their experiences to take the reader to the forefront of stakeholder engagement and to highlight the six elements of corprate diplomacy.

A useful guide on how to manage the collective opinion of external stakeholders in a business… In short, Witold J. Henisz has given a fascinating and fresh insight into smart stakeholder engagement by managing the analytical and behavioural elements of diplomacy. 

CSR International Book Review Digest Sasmita Maurya

A masterful template for how to run a successful corporate affairs department in pursuit of a 'social licence to operate'.

Adrian Henriques

A practical guide to creating value for stakeholders. Managers can learn the diplomatic skills they need to deal with all kinds of stakeholders in a positive and constructive way. This is a rare book that is theoretically sound and practically relevant.

on 4 Apr 2014 R. Edward Freeman, University Professor and Olsson Professor, The Darden School, University of Virginia

This book addresses one of the most important issues for a modern corporation, not just in resources but in any industry. Starting with some really valuable techniques for mapping stakeholders, Witold Henisz goes on to demonstrate with many examples how this data can be integrated and applied. He concludes with very valuable examples of traps to avoid. An excellent guide, whether a company is starting afresh or checking well-developed approaches for potential flaws.

Sir Mark Moody-Stuart, Chairman, Global Compact Foundation; MD, Royal Dutch Shell 1991–2001; author, 'Responsible Leadership'

In "Corporate Diplomacy" Witold Henisz draws from years of experience in the trenches - and he shares his insights in colorful stories about companies around the world who succeed or fail depending on their ability to engage with their stakeholders. The story of the privatization of power supply in the post-communist Republic of Georgia reads like a thriller and does not provide easy answers. But drawing from this and other experiences, Henisz develops a comprehensive and practical approach to guide those tasked with corporate diplomacy in their work. This book is full of concrete approaches that can help companies improve their interactions with various stakeholders. And it shows clearly that, for sustained success, it is not enough to look inside the organization, improving production and internal processes. A company that fails to engage in corporate diplomacy risks angering their neighbors, regulators and other stakeholders - who can severely damage the organization and, in the worst case, drive it into bankruptcy.

on 5 Jan 2014 Eva Schiffer, Leadership Trainer, The World Bank

Corporate Diplomacy spells out the business sense of strategically building relationships with stakeholders. Its case studies are a useful reference in the search for ways to continually improve this crucial area of business.

on 31 Mar 2014 Yedwa Simelane, Executive Vice President, Stakeholder Relations & Marketing, AngloGold Ashanti

It contributes new insights and methods to the subject of stakeholder engagement in an original and highly readable way.

Robert Boutilier, President and Founder of Stakeholder 360; author, 'A Stakeholder Approach to Issues Management' and 'Stakeholder Politics: Social Capital, Sustainable Development and the Corporation'

Today's diplomats are found in corporations, the globe-hopping, resource- and talent-rich organizations on the front line of complex issues from human rights to adjudication of water rights. Success as a corporate diplomat requires a remarkable set of talents and skills - from data analysis to deep listening. Professor Henisz's new book is the ultimate field guide to this new brand of diplomacy.

on 29 Mar 2014 Judith Samuelson, Executive Director, Aspen Institute's Business + Society Program

Incisive and thought-provoking. The author tells us the why and how of building stakeholder relations that add value and reduce risk. This book can sharpen the skills that corporations need most in difficult places.

Cameron Hume, Former US Ambassador to Indonesia, Algeria & South Africa; Consultant to Sinar Mas Group

In today’s world, more than ever before, the license to operate for any business depends on establishing and maintaining good relationships with the full range of the company’s stakeholders. Witold Henisz shows why that matters, the price of not managing it effectively and a clear framework for how to go about it. "Corporate Diplomacy" offers a valuable route map to help business leaders find their path through what can be challenging and unfamiliar terrain.

Lucy Parker and Jon Miller, authors of 'Everybody’s Business: The Unlikely Story of How Big Business Can Fix the World'

Some of the most difficult issues facing extractive industry companies today are not technical – they’re human challenges. Henisz's "Corporate Diplomacy" is a must-read, not just for Community relations or Communications Managers, but for virtually any executive with a decision-making power that inevitably affects external stakeholders. General Managers, CFOs, Human Resources and Procurement professionals, to name a few, need to be the day-to-day corporate diplomats whose actions make or break relationships with stakeholders. This book offers the most insightful, practical thought leadership guidance in the ever-changing field of stakeholder engagement for them to be successful.

Thibaut Millet, Associate Partner, Climate Change & Sustainability, EY

As a practitioner working in the area of stakeholder engagement, "Corporate Diplomacy" provides outstanding guidance on creating an effective stakeholder engagement strategy as well as providing the accompanying practical tools and frameworks to implement it. Witold Henisz illustrates the ever-present dynamic in the corporate environment, that it is essential to show both your external and internal stakeholders that your work is supported by sound strategy as well as clear implementation practices. Without both, the real business value is not achieved and your relationships with your stakeholders becomes compromised. Witold Henisz emphasizes that developing strong relationships with key stakeholders is not simply about good PR or corporate spin. It is actually about the broader goals of the organization and should be closely integrated into the operational performance of the business. Increasingly, organizations that ignore this do so at their own peril.

Felicity Fouche, Independent Strategic Communications and Stakeholder Engagement Consultant; formerly with AngloGold Ashanti & Rio Tinto

With trust in corporations at all-time lows and the importance of business and society issues at all time highs, "Corporate Diplomacy" shows how systematic but practical engagement with stakeholders can address both problems.

Ben W. Heineman, Jr, senior fellow at Harvard's schools of law and government; former GE SVP for Law and Public Affairs

Witold Heinsz offers an new paradigm for looking at the increasingly tough political and social challenges which companies face in emerging markets. If your company is facing a blockage or seeking a "license to operate," Corporate Diplomacy should be required reading.

Steven Fox, Managing Partner & Founder, Veracity Worldwide LLC

Call them corporate diplomats, corporate idealists, or government or community relations professionals: Witold Henisz knows that they determine whether global companies fail or succeed. In Corporate Diplomacy he speaks directly to them, presenting cases, data, tools, and advice to help them improve outcomes for their companies, affected stakeholders - and consequently the world at large.

Christine Bader, author, 'The Evolution of a Corporate Idealist: When Girl Meets Oil'

This book is a refreshing perspective on how stakeholder engagement can move beyond simple PR and sentimental aspirations to a practice that creates real value for all involved. Witold Henisz effectively uses real examples to demonstrate why shareholder value and public benefit are inherently intertwined. From there he provides readers with the practical tools needed to develop winning corporate diplomatic strategies.

Eric Kacou, Co-founder, ESPartners; author, 'Entrepreneurial Solutions for Prosperity in BOP Markets'

Witold Henisz uses creative rigour to build an important bridge between practitioners of corporate diplomacy and those who may not always value its contribution to business success.

on 24 Feb 2014 Robert Court, Global Head of External Affairs, Rio Tinto

Witold Henisz’s book will define the field of Corporate Diplomacy for the foreseeable future. He illustrates why modern international companies need to invest in this previously unheralded aspect of the leadership craft; and he advances both the science and the art of this critical function. He shows that in the era of big data and analysis, companies can do a lot more to understand and shape the global environment for their products and services, and thus to create value for their own stakeholders. He shows that enlightened companies will place quite as much importance on diplomacy as do governments.

on 24 Feb 2014 Nick Lovegrove, Senior Director, Albright Stonebridge Group; former Senior Director, McKinsey & Company; former senior advisor, UK Prime Minister’s Strategy Unit

By elevating the importance of corporate diplomacy in creating value and providing a cogent framework to follow, Witold Henisz's work offers a novel analytical rubric that practitioners in all sectors will benefit from.

Ian Bremmer, President & Founder, Eurasia Group; author, 'Every Nation for Itself: Winners and Losers in a G-Zero World' and 'The End of the Free Market: Who Wins the War Between States and Corporations?'

Henisz's Corporate Diplomacy offers a rare multi-disciplinary guide far beyond social license. The innovative tools and simplified checklists are accessible to staff at all levels. Data, dynamics and internal engagement summarize much experiential learning from the past decade. As we open our companies to more enduring external engagement, we have to be intentional and aware of our own internal cultures and communication styles. … Armed with the lessons from this book, I expect the next generation of corporate diplomats to catapult us forward so that extractive industries, in particular, may better serve people, planet and profit.

on 5 Jan 2014 Veronica Nyhan Jones, Extractives Sector Lead, Strategic Community Investment/CommDev, Sustainable Business Advisory, International Finance Corporation

It seems common sense, but to view yourself from the perspective of your stakeholders can show you things you simply cannot see. Effective and meaningful stakeholder engagement relies on sound analysis and people engaging people about issues they care about. Corporate Diplomacy provides example after example of the value of the process of building good relationships and the cost of getting it wrong.

on 8 Nov 2013 Nicholas Cotts, Group Executive Environment and Social Responsibility, Newmont Mining Corporation



1. Due diligence: Mapping and analysis of your stakeholders

2. Integration: From stakeholder maps to financial and operational performance

3. Personal: Stakeholder relationships are personal relationships

4. Learning: Humility in adapting to negative feedback in a necessarily imperfect strategy

5. Openness: Strategic communications to reinforce trust and reputation

6. Mindset: Externally facing long-term organizational culture

Conclusion: 12 traps to avoid


About the author


WITOLD J. HENISZ is the Deloitte & Touche Professor of Management in Honor of Russell E. Palmer, former Managing Director at The Wharton School of The University of Pennsylvania.

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