In this research, the authors present a model that demonstrates that motivating managers to change unpopular or irresponsible corporate behavior may be required when the stakeholders desire such a change. Using agency theory, they then test part of the model and demonstrate why it may be necessary for an organized protest to impact on share prices before managers choose to change the behavior. Investors' reactions to announcements of product boycotts and stock divestitures made over the 23-year period 1969-1991 were examined. (...) Announcements about boycotts were associated with significant negative market reactions, whereas divestiture announcements resulted in no significant market responses. From a pure stock market perspective, boycotts appear to be a more effective tool in influencing managers to change a company's behavior. (shrink)

This article examines the extent to which diversity characteristics and stakeholder role influence individuals’ corporate social orientation (CSO). Our findings indicate that one’s relationship to the organization as well as diversity, gender, and race influence one’s CSO. Specifically, we found that employees’ greatest concern was economic whereas customers had a stronger ethical orientation. The results also suggest that women as well as Black employees and customers place more emphasis on whether an organization is fulfilling its discretionary responsibilities than do males (...) and Whites. A model using the concept of value congruence is presented to guide future research. (shrink)

Although business and society scholars have sought to demonstrate that corporate social performance (CSP) leads to corporate financial performance (CFP), a complete model of the pathway from CSP to CFP has not been substantiated. One suggestion is that certain indicators of CSP are noticed by stakeholders, who then act in ways that ultimately affect the firm's CFP. The present study focused on the first step in this path: identifying the factors that initially lead a stakeholder group to target a particular (...) firm. Existing theory from the literature on the environmental movement, stakeholder theory, and CSP fostered the development of eight propositions regarding corporate environmental performance. Case studies of five environmental non-governmental organizations (ENGOs) are used to address the propositions. The case studies also supply additional insight into ENGO targeting of particular firms, unrelated to the propositions, thereby facilitating the development of a theoretical model. (shrink)