This study examines how stakeholder consultations influence policy effectiveness, drawing on extensive analysis of recent consultation processes from major development institutions including the World Bank, Asian Development Bank, and UN agencies. Through qualitative analysis of consultation frameworks, case studies, and academic literature, the research reveals that meaningful stakeholder engagement significantly enhances policy legitimacy, ownership, and effectiveness, though challenges including tokenism, elite capture, and power dynamics persist. The findings provide actionable recommendations for governments and multilateral development banks to strengthen consultation processes and improve policy outcomes through institutionalized feedback loops, hybrid engagement models, and systematic inclusion of marginalized voices.