I look at this a little differently. OP seems to treat Engineering as a totally independent organization within a company. In bigger companies, I understand. But I don't think it makes as much sense in a smaller company, where, often, the tight-knit culture is what's keeping the ship afloat.

Engineering is one piece of the pie. The success of the company is everyone's success. Consequently, the team's hiring process can and should be influenced by people outside of Engineering, to some extent. One has to take the comapany's culture in account.