Exam Practice - Stakeholders - Leary, Joyce and Lines

Question 1

What would be a good introduction?

Answer 1

This Board Paper evaluates the effectiveness of stakeholder conversations at Beddy Buys plc using Leary, Joyce & Lines’ six-lens model. It integrates the Credibility Equation to assess trust-building and offers practical recommendations to improve governance through more inclusive, transparent engagement.

Question 2

What are stakeholder conversations?

Answer 2

Stakeholder conversations are the interactions between the Board and those impacted by or influencing the company’s activities, including employees, shareholders, suppliers, and the community. Effective Boards foster trust, dialogue, and clarity of purpose.

Leary, Joyce & Lines (2008) propose six lenses to interpret stakeholder dynamics, while the Credibility Equation (Maister et al.) defines trust as:

Credibility = (Trust + Reliability + Intimacy) ÷ Self-Orientation

This means Boards earn influence by being dependable, empathetic, and selfless in their approach.

Question 3

Describe the 6 lenses framework using a using a stakeholder analysis

Answer 3

1. Individual - Understanding personal needs, motivations and expectations of stakeholders
2. Interpersonal - Quality of 1:1 relationships between directors and stakeholders
3. Team Task - How well the Board works collaboratively in stakeholder oversight
4. Team Relationship - Internal Board cohesion affecting external messaging
5. External Stakeholder - Board’s engagement with key groups (e.g. investors, employees, communities)
6. Systemic - Wider societal, regulatory and reputational context (e.g. Section 172 duties)

The model encourages Boards to move beyond transactional updates toward authentic, trust-based engagement.

Question 4

analysis and apply the stakeholder engagement of Beddy Buys PPLC using the framework

Answer 4

Stakeholder conversations at Beddy Buys are superficial and fragmented, risking reputational and strategic misalignment:

Individual lens: Staff concerns are filtered or suppressed — CJ withholds feedback from frontline employees, and new neds members remain silent.

Interpersonal lens: There are weak personal connections between NEDs and internal stakeholders. The absence of site visits or informal dialogue reflects low intimacy.

Team task lens: ESG and workforce matters are not embedded into Board decision-making. There is no clear accountability or ownership for stakeholder interests.

Team relationship lens: A fractured Board lacks shared purpose. The Chair and CEO often operate in silos, creating an inconsistent tone for external relationships.

External stakeholder lens: Investor communication appears minimal. The case mentions no proactive shareholder dialogue, even amid uncertainty around new product launches.

Systemic lens: The Board fails to demonstrate awareness of its Section 172 Companies Act duties or respond to wider trends around stakeholder capitalism or ESG transparency.

Question 5

Apply the creditability equation

Answer 5

According to the Credibility Equation, the Board scores low on all fronts:

Trust: Stakeholders are not listened to directly.

Reliability: There is no evidence of follow-through or feedback loops.

Intimacy: The Board lacks empathy or understanding of lived experiences.

Self-orientation: Conversations are inward-facing, shaped by internal dynamics rather than stakeholder outcomes.

Question 6

As a CoSec, what would you recommend?

Answer 6

Quick Wins

Credibility Audit: Apply the Credibility Equation to key relationships (e.g. workforce, suppliers, investors). Discuss in a Board session: “Where is trust breaking down?”

Structured Insight Flows: CJ should report employee themes and morale regularly. Site visits should be revived to promote direct Board engagement.

Medium-Term Steps

Stakeholder Mapping Exercise: Use the six lenses to classify groups, use mendelow matrix to map stakeholders expectations based on pwoer and impact, and assign Board responsibility for engagement.

Embed Stakeholder Voice: Add employee voice to the agenda; rotate presenters from key stakeholder-facing teams.

Training: Directors should be briefed on Section 172 and how to apply it in practice — aligning decisions with long-term impact.

Long-Term Change

Establish a Stakeholder Advisory Panel to test ideas and ensure community concerns are considered.

Incorporate stakeholder KPIs into strategic dashboards and Board evaluations.

The Company Secretary should embed these practices into Board planning, agendas, and evaluation cycles.

Question 7

Why is it important

Answer 7

Neglecting stakeholder conversations weakens trust and legitimacy.

A cautionary example is the Boohoo supply chain scandal (2020), where the Board failed to engage with risks linked to supplier practices. Despite strong financials, reputational damage and investor pressure followed — illustrating the cost of stakeholder detachment.

At Beddy Buys, a similar drift is evident. The Board lacks the mechanisms, mindset, and structure to hear stakeholder voices.

Reforming conversations through the six lenses and building credibility will support alignment with UK Corporate Governance Code Principle E and Section 172 duties. It will also help the Board become more reflective, responsive, and trusted — laying the groundwork for long-term success.