We review articles about corporate political activity published in Business & Society since its beginnings 60 years ago and in a set of other leading management journals over the past decade. We present evidence that most studies of CPA use the political markets’ perspective. Under the premise that the contemporary political environment has changed significantly since the inception of the political markets’ perspective, our review asks two interconnected questions. First, to what degree have changes in the political environment challenged the (...) ability of the political markets’ perspective to understand the pillars of politics: issues, institutions, interests, and information? Second, to what degree have CPA scholars augmented or diversified their theoretical arguments to accommodate these changes in the political environment? We document the CPA literature across these dimensions and questions and note that many scholars are already adopting other theories side by side with the political markets’ perspective. (shrink)

In his invited essay for Business & Society’s 60th anniversary, Archie B. Carroll refers to human rights as “a topic that holds considerable promise for CSR [corporate social responsibility] researchers in the future.” The objective of this article is to unpack this promise. We discuss the momentum of business and human rights in international policy, national regulation, and corporate practice, review how and why BHR scholarship has been thriving, provide a conceptual framework to analyze how BHR and corporate social responsibility (...) relate to each other, and provide a research agenda outlining how BHR can expand business and society scholarship in general and one of its foundational constructs, CSR, in particular, beyond the current confines of the business and society field. (shrink)

Business scholars pay increasing attention to the expanded influence of stakeholders on firm strategies, legitimacy, and competitiveness. At the same time, analysts have noted that the transformed regulatory and legislative environments of recent decades have encouraged firms to become much more politically active. Surprisingly, relatively little research has tied together these two trends. The present study integrates perspectives on stakeholder management with research on corporate political activity to develop an understanding of the structural sources of stakeholder mobilization in professional grassroots (...) lobbying campaigns. This study employs a unique, original data source to consider how the adoption of grassroots lobbying by a firm relates to its industry, degree of inside lobbying, partisan PAC contributions, and more. This research shows that corporate grassroots lobbying is shaped most significantly by a firm’s degree of inside lobbying, as highly active firms take a diversified strategy for gaining influence. Firms in industries with a heavy public presence as well as those concerned with taxation, government appropriations, and economic development also adopt these strategies readily. PAC contributions to Republican, but not Democratic, candidates also heighten firms’ propensity to lobby the public. (shrink)

This article examines the factors that influence the propensity of corporations to engage with NGOs. Drawing from resource dependency theory and related theories of social networks and the resource-based view of the firm, the authors develop a series of hypotheses that draw from this conceptual foundation to predict a range of factors that influence firms to collaborate with NGOs. These factors include the level of commitment of the firm to CSR, the strategic fit between the firm’s and the NGO’s resources, (...) the level of trust the firm has in NGOs, the frequency of contact with NGOs, prior level and perception of experience with NGOs, and the level of pressure exerted by NGOs. The authors report on results of a survey of the Top 500 firms in the Netherlands on their interactions with NGOs, finding general support for our hypotheses, and suggest that understanding the motives for firm–NGO interactions can teach us more about firms’ corporate social activities and the way such activities are shaped in the dynamic interplay between firms and their stakeholders. Our findings are relevant for future research on cross-sectoral interactions, for corporations considering future relationships with NGO cohorts, and for broader questions about the role of stakeholders and the role of business in society. (shrink)

This study tests an integrative model of corporate political action, the filter model, based on the behavioral theory of the firm. The filter model posits that external political, economic, and industry environments are mediated by organizational structures and resources to affect a firm’s political actions. The authors rate the filter model’s predictive power against that of an economic-based direct-effects model by examining the efforts of about 1,100 U.S.-domiciled manufacturing firms to influence trade policy. LISREL analysis demonstrates that the integrative filter (...) model provides a superior explanation of corporate political action. (shrink)

The so-called revolving door between employment in government and industry is especially relevant to the U.S. Congress because ex-legislators are notorious for taking jobs as lobbyists. There are two prominent explanations for why they do so: Lobbying either matches the talents of former legislators due to their specialized congressional training or it represents customary ex-post payments for ex-ante legislative assistance to special interests. This article explores the former dynamic, focusing on how specialized training impacts occupational outcomes of legislators and finds (...) strong evidence to support the notion that former legislators become lobbyists due to unique human capital. This finding somewhat qualifies the notion that possible ex-post payments are a main driver for the postelective employment choices of ex-legislators. (shrink)

Is protection for sale? In this research, we examine the effect of corporate lobbying on the disbursement of proceeds of the recent antidumping petitions under the Continued Dumping and Subsidy Offset Act, the so-called Byrd amendment. With the use of novel U. S. Customs Service data on the disbursements of the antidumping duties to the injured firms, we find that the petitioning firms that spend more on lobbying gain larger proceeds. We conclude that firms that lobby are the ones that (...) get protection, not necessarily the healthy ones. (shrink)

In recent years, trade-control laws and regulations such as embargoes and sanctions have gained importance. However, there is limited empirical research on the ways in which small- and medium-sized enterprises (SMEs) respond to such coercive economic measures. Building on the literature on organizational responses to external demands and behavioral ethics, this study addresses this issue to better understand how external pressures and managerial decision-making are associated with the scope of trade-control compliance programs. Based on a sample of 289 SMEs, the (...) findings show that the organizational responses of SMEs reflect proportionate adjustments to regulatory pressures but only if decision-makers are well informed and aware of the prevailing rules and regulations. Conversely, uninformed decision-making leads to a disproportionate response resulting in an inadequately reduced scope of the compliance program. In addition, the results indicate that SMEs that are highly integrated into supply chains are susceptible to passing-the-buck behavior. (shrink)

In his invited essay for Business & Society’s 60th anniversary, Archie B. Carroll (2021, p. 16) refers to human rights as “a topic that holds considerable promise for CSR [corporate social responsibility] researchers in the future.” The objective of this article is to unpack this promise. We (a) discuss the momentum of business and human rights (BHR) in international policy, national regulation, and corporate practice, (b) review how and why BHR scholarship has been thriving, (c) provide a conceptual framework to (...) analyze how BHR and corporate social responsibility (CSR) relate to each other, and (d) provide a research agenda outlining how BHR can expand business and society scholarship in general and one of its foundational constructs, CSR, in particular, beyond the current confines of the business and society field. (shrink)

This article offers a rare study of the content and performance of political strategies in China’s highly institutionalized setting. A conceptual framework based on institutional theory findings is proposed to develop a set of expected political behavior. This is then confronted to data from a convenient sample of 233 firms. The results show that there are indeed recognizable patterns of political strategy, most of which are bent by the strong institutional environment toward accommodation rather than confrontation or defiance. The strategies (...) identified were found to be related to the nature of the firms’ available resources and to the firms’ ability to extract benefits or bend the government’s behavior in their favor. (shrink)

Several scholars have asserted strategic fit to nonmarket factors is positively related to economic performance. Political strategic fit has traditionally been conceptualized as an incremental decision: firms engage in political activities to the extent nonmarket factors suggest firm political actions will improve economic performance. However, the decision to engage in political activity is more of a dichotomous decision (political activity versus free riding). Both incremental and dichotomous political strategic fit are empirically evaluated in the U.S. coal industry from 1986 to (...) 2000. Empirical evidence suggests that political strategic fit should be modeled as a dichotomous decision and that engaging in political activity is positively related to economic performance. Under investing in political activity or pursuing a free riding strategy was negatively related to economic performance. (shrink)

Using a contingency theory framework, this study examines the relationship between a firm’s business-government relations (BGR) strategy, BGR structure, and BGR performance. Based on previous work, the study hypothesizes that BGR strategy determines, in part, the structure of the public affairs function, as well as the function’s effectiveness. Furthermore, the study contends that an appropriate fit between BGR strategy and BGR structure leads to improved BGR performance. Results indicate that there is a positive association between BGR strategies (buffering and bridging) (...) and BGR performance. There is also a positive association between BGR strategy and BGR formalization (structure). However, the study finds no direct association between BGR structure and performance. Further analysis reveals that it is a fit between a firm’s BGR strategy and BGR structure that leads to improved BGR performance. The associations between strategy, structure, fit, and performance offer empirical support for the relevance of the contingency theory framework to BGR research. (shrink)

Over the past four decades, stakeholder research has united a chorus of voices from different disciplines using different terminology for different audiences all related to a seemingly similar topic: those that affect and are affected by business. By juxtaposing a comprehensive review of the early years of stakeholder research against more recent stakeholder research, we identify areas of common convergence as well as emergent scholarship. We develop an organizing framework consisting of three stakeholder-related themes: who or what is a stakeholder; (...) mechanisms underlying stakeholder relationships; and outcomes-oriented stakeholder research. Future research opportunities include: simultaneously examining multiple stakeholders at multiple levels; multiplier effects along the value chain and across geographies; and net impacts. We conclude by identifying how stakeholder research can “move the needle” on important business issues such as: income inequality and CEO pay; human rights and building community inclusion; disease alleviation; and food security in firms’ continuous quest to create value. (shrink)

Rowley and Berman (2000) are tackling the right questions in their article. Three critical questions, in essence, are asked: What is corporate social performance (CSP)? What does it mean (i.e., CSP measures)? And, where does the future lie with CSP? In answering these questions, they are creating a CSP research agenda for the 21st Century. While agreeing, to a large extent, with their new set of questions, this paper questions their rationale for what is currently wrong with CSP and focuses (...) on extending future research directions. Specifically, this paper suggests that existing research in related disciplines can help accelerate our understanding of CSP. Marketing (i.e., customer-organization relations) and human relations (i.e., employee-organization relations) literatures, for example, already critically examine the conditions under which various organizational practices, policies, and procedures flourish. These boundary spanning functions provide newinsights that can lead to a broader, richer, and more systematic understanding of the complex CSP construct. (shrink)

Several scholars have asserted strategic fit to nonmarket factors is positively related to economic performance. Political strategic fit has traditionally been conceptualized as an incremental decision: firms engage in political activities to the extent nonmarket factors suggest firm political actions will improve economic performance. However, the decision to engage in political activity is more of a dichotomous decision. Both incremental and dichotomous political strategic fit are empirically evaluated in the U.S. coal industry from 1986 to 2000. Empirical evidence suggests that (...) political strategic fit should be modeled as a dichotomous decision and that engaging in political activity is positively related to economic performance. Under investing in political activity or pursuing a free riding strategy was negatively related to economic performance. (shrink)

Using resource dependency and institutional theories, we create and test a model examining the relationships among senior management commitment, resource allocations, and the structure of public affairs departments. Using a large sample of U.S.-based firms, we find a positive relationship between senior management commitment to the public affairs function and the level of human and monetary resources allocated to the public affairs department. Furthermore, firms structure their public affairs responsibilities into three common activity sets: communications, collaborations, and local activities. These (...) common activities are, in turn, positively associated with senior management commitment and resources allocated to the public affairs department. (shrink)

This conceptual article draws on structuration theory and social identity theory to isolate firm-internal institutionalization processes as antecedents and drivers of corporate political strategizing. Path dependencies in corporate routines and actors' knowledgeability about these path dependencies are singled out as primary factors structuring strategic decision making within the firm. The concepts of path dependency and knowledgeability, respectively, refer to the institutional and cognitive dimension of corporate political strategizing. These two dimensions come together in actors' identities. Identities on their turn shape (...) managers' recognition of policy issues and the interpretation of issue salience relative to corporate interests. Thus, the article argues that institutional features of competitive environments precipitate in processes of identity building and preference formation and are reproduced through organizational routines and practices within the firm. (shrink)

Given corporate lobbying’s double-edged nature, previous research has been interested in what motivates firms to engage in lobbying. In this study, we build on previous works to analyze how two types of aspiration, historical aspiration, which represents the level of performance firms aim to achieve given past self-performance, and social aspiration, which represents the level of performance firms aim to achieve given competitors’ achievements, shape corporate lobbying decisions. Our premise is that when a firm’s product market performance is below historical (...) aspirations, then the firm is motivated to engage in lobbying because the benefits of lobbying outweigh the potential costs. However, when a firm’s product market performance is below social aspirations, then decision-makers perceive that the potential challenges of lobbying outweigh the benefits and decide not to engage in lobbying. By examining automotive firms in the U.S. light vehicle market from 1998 to 2013, we find significant empirical support for our general premise. Using Tobit regression analysis, we find that automotive firms present diverging motivations for lobbying depending on whether they attend to historical or social aspirations for sales performance. (shrink)

Variance theories have dominated corporate political action (CPA) research because the pioneering works in the 1970s and 1980s. Process theories offer an entirely new perspective on CPA research, as they are able to explain processes across a number of levels of analysis and link actions to contexts. We add to the existing CPA literature by offering a process model that can be useful especially in historical and evolutionary analysis. Our model depicts CPA as a complex system in which a firm’s (...) actions are affected by various factors across organizational, industry, and institutional levels of analysis. As political actions also influence these factors, the process is in essence systemic and path dependent. Our model supplements existing research by offering the possibility to explain the long-term consequences of CPA vis-à-vis wider societal changes and by promoting longitudinal research strategies. In addition to the theoretical model, we provide a historical analysis of the evolution of the Finnish paper and pulp industry to illustrate the applicability of the framework. (shrink)

This article explores the concept of political capital in the setting of multinational corporation foreign subsidiaries. Drawing on resource dependence theory, the literature on corporate political activities, and the bargaining power framework, hypotheses are developed examining the antecedents to subsidiary political capital. The article tests hypotheses based on primary data from 91 foreign subsidiaries using path analysis. The empirical results suggest that both ownership of bargaining power resources and the management of those resources through government affairs activities are important in (...) explaining the variation of political capital across foreign subsidiaries. (shrink)