The purpose of this article is to transcend the assumption that stakeholder engagement is necessarily a responsible practice. Stakeholder engagement is traditionally seen as corporate responsibility in action. Indeed, in some literatures there exists an assumption that the more an organisation engages with its stakeholders, the more it is responsible. This simple 'more is better' view of stakeholder engagement belies the true complexity of the relationship between engagement and corporate responsibility. Stakeholder engagement may be understood in a variety of different (...) ways and from a variety of different theoretical perspectives. Stakeholder engagement may or may not involve a moral dimension and, hence, is primarily a morally neutral practice. It is therefore argued that stakeholder engagement must be seen as separate from, but related to, corporate responsibility. A model that reflects the multifaceted relationship between the two constructs is proposed. This model not only allows the coincidence of stakeholder engagement with corporate responsibility, but also allows for the development of the notion of corporate irresponsibility. (shrink)

In this paper we investigate whether, and how, corporate management strategically uses disclosure to manage the perceptions of different organizational audiences. In particular, we examine the interactions between the FIAT Group and three of its key organizational audiences—the local press, the international press, and the financial analysts, which are characterized by different levels of salience for the company. We focus on both how management reacts to the optimism level existing within each audience and how the narrative disclosure tone adopted by (...) FIAT influences the ex-post optimism in the local and international press or in the financial analyst community. We investigate the disclosure of the FIAT Group over a 6-year period , during which 70 price-sensitive press releases were published. On the basis of 1,887 news articles published in Italian newspapers and 411 analyst reports, we report evidence of different strategic patterns in the interaction processes between FIAT and its audiences. Our findings also indicate some differences in the way FIAT is affected by, and in turn, affects the sentiment of each audience, thus highlighting that the salience of the stakeholder is an important driver of the adoption of impression management techniques. Taken together, our findings point to issues related to setting the “tone at the top” and potential ethical matters. (shrink)

ABSTRACT:In a world filled with poverty, environmental degradation, and moral injustice, social enterprises offer a ray of hope. These organizations seek to achieve social missions through business ventures. Yet social missions and business ventures are associated with divergent goals, values, norms, and identities. Attending to them simultaneously creates tensions, competing demands, and ethical dilemmas. Effectively understanding social enterprises therefore depends on insight into the nature and management of these tensions. While existing research recognizes tensions between social missions and business ventures, (...) we lack any systematic analysis. Our paper addresses this issue. We first categorize the types of tensions that arise between social missions and business ventures, emphasizing their prevalence and variety. We then explore how four different organizational theories offer insight into these tensions, and we develop an agenda for future research. We end by arguing that a focus on social-business tensions not only expands insight into social enterprises, but also provides an opportunity for research on social enterprises to inform traditional organizational theories. Taken together, our analysis of tensions in social enterprises integrates and seeks to energize research on this expanding phenomenon. (shrink)

This paper analyzes the opportunities offered by information and communication technologies (ICTs) and the related ethical issues, within the transparency practices of nongovernmental organizations (NGOs). Based upon a one-year study of a European NGO, the Italian Association of Blind People, it presents compelling empirical evidence concerning the main ethical, social and economic challenges that NGOs face in the development of more transparent relationships with the public and the related role of ICTs, in particular, the organization’s website. This study shows that, (...) although the attempt to be completely transparent has great ethical value, ICT-enabled information disclosure is limited by privacy and security concerns and by pressure from financial supporters and benefactors and potential NGO competitors who vie for grants and donations. The paper provides some implications and suggestions for managers of NGOs and policy makers. (shrink)

The purpose of this paper is to enter the conversation about stakeholder theory with the goal of clarifying certain foundational issues. I want to show, along with Boatright, that there is no stakeholder paradox, and that the principle on which such a paradox is built, the Separation Thesis, is nicely self-serving to business and ethics academics. If we give up such a thesis we find there is no stakeholder theory but that stakeholder theory becomes a genre that is quite rich. (...) It becomes one of many ways to blend together the central concepts of business with those of ethics. Rather than take each concept of business singly or the whole of “business” together and hold it to the light of ethical standards, we can use the stakeholder concept to create more fine-grained analyses that combine business and ethics; or more simply, we can tell many more, and more interesting, stories about business. (shrink)

In an increasingly complex world with increasingly powerful organisations it seems inevitable that society – or groups in society – would become anxious about whether these organisations could be encouraged to match that power with an appropriate responsibility. This is the function of accountability – to require individuals and organisations to present an account of those actions for which society holds them – or would wish to hold them – responsible. And the history of social accounting, at its most fundamental, (...) is a history of attempts to develop this accountability. It seems to me that the widespread and systematic practice of social and environmental accounting is a deeply essential element in any well‐functioning, complex democracy. The corollary is that the absence of such mechanisms raises fundamental questions about the nature of modern democracies. This article briefly outlines what I believe to be the three strands of social accounting. It then identifies a few of the lessons that we may be able to learn from current experience and, in particular, how social accounting is related to accountability, democracy and sustainability. The central issue of the tension between accountability and control is touched upon: I then illustrate how the stakeholder model can be used to help define the social account, and conclude with a few words on attestation. (shrink)

Since its inception, Stakeholder Management Capability (SMC) has constituted a powerful hermeneutic through which business organizations have understood and leveraged stakeholder relationships. On this model, achieving a high level of capability largely depends on managerial ability to effectively bargain with stakeholders and establish solidarity vis-à-vis the successful negotiation, implementation, and execution of "win–win" transactional exchanges. Against this account, it is rightly pointed out that a transactional explanation of stakeholder relationships, regarded by many as the bottom line for stakeholder management, fails (...) to provide managerial direction regarding how to resolve a variety of normative stakeholder claims that resist commoditization. In response to this issue, this paper has two overlapping goals. It seeks to elaborate a discourse theoretical approach to the problem by first drawing out Jurgen Habermas’ theory of communicative action and delineating the various types of rational discourse. Second, the paper attempts to present concrete implications for SMC relative to reshaping the contours of rational, process, and transactional analysis in light of central discourse theoretical conclusions. (shrink)

This article presents a critical examination of the process of stakeholder dialogue in the Corporate Social Responsibility (CSR) field. It utilises data from a three-year research project into stakeholder dialogue processes to discuss three central themes: first, what is meant by the term ‘dialogue’, both from a theoretical perspective and from its practical application within CSR; second, the challenges of creating effective dialogue; and third, measuring and assessing the potential outcomes of dialogue. In providing a critical overview of these themes, (...) the article examines the nature of organisational learning through stakeholder engagement and dialogue. It questions the motives behind engagement in dialogue and highlights some of the potential challenges for organisational learning posed by opting for a stakeholder dialogue approach. It argues that organisations engaging in stakeholder dialogue must have a clear understanding of the implications of undertaking a dialogue process and have a long-term perspective regarding the outcomes and learning likely to emerge from it. While stakeholder dialogue may produce significant results, it is argued, many of these may be difficult to quantify on a short-term basis. (shrink)

This article presents the results of the longitudinal study of Addiopizzo, a successful anti-bribery organization founded in Sicily in 2004. It analyzes how this organization has used information disclosure as a strategy to fight adverse environmental conditions and the immoral activities of the Sicilian Mafia. This article extends the business ethics and corporate social responsibility literature by showing how multi-level strategic information disclosure processes can help gain organizational legitimacy in adverse social environments and successfully fight against social resistance to change, (...) low levels of moral imagination and attacks from criminal organizations. This article provides an additional contribution to the literature by linking the three research streams on corporate transparency, the fight against corruption, and organizational legitimacy. The results of this research also contribute to the special issue of the EBEN AC 2010, “Which values for which organizations”, since it provides a unique example of an organization capable of spreading the values of social justice and honesty in a difficult social environment plagued by Mafia. (shrink)

The term “corporate transparency” is frequently used in scholarly discussions of business ethics and corporate social responsibility (CSR); however, it remains a volatile and imprecise term, often defined incompletely as “information disclosure” accomplished through standardized reporting. Based on the results of empirical studies of organizational behaviors, this paper identifies a new set of managerial practices based on the use of information and communication technologies (ICT) and particularly Internet-based tools. These practices are resulting in what can be termed “dynamic transparency.” ICT (...) allows for an informational environment characterized by two-way exchange between corporations and their stakeholders, which fosters a more collaborative marketplace. It is proposed that such dynamic information sharing, conducted by means of ICT, drives organizations to display greater openness and accountability, and more transparent operations, which benefit both the corporations and their constituents. One of the most important outcomes that will accrue to consumers and other individuals is the “right to know,” especially about corporate strategies and activities that might directly affect their quality of life. This paper demonstrates that dynamic transparency is more desirable and more effective than the more common “static transparency” where firms’ information disclosure is one-way, usually in response to government regulation. We present three ethical arguments to justify the implementation by business firms of dynamic transparency and demonstrate that their doing so is related to CSR and to augment and complement stakeholder engagement and dialogue. The paper concludes with a summary of the possible limits to and the problems involved in the implementation of dynamic transparency for corporations, and suggests some strategies to counter them. (shrink)

In this article, we use content and cluster analysis on a global sample of 200 social entrepreneurial organizations to develop a typology of social entrepreneuring models. This typology is based on four possible forms of capital that can be leveraged: social, economic, human, and political. Furthermore, our findings reveal that these four social entrepreneuring models are associated with distinct logics of justification that may explain different ways of organizing across organizations. This study contributes to understanding social entrepreneurship as a field (...) of practice and it describes avenues for theorizing about the different organizational approaches adopted by social entrepreneurs. (shrink)

Two cultures are at play in the field of social entrepreneurship: an age-old culture of charity, and a more contemporary culture of entrepreneurial problem solving. These cultures permeate activities from resource providers to front line operations. Both have roots in our psychological responses to the needs of others and are reinforced by social norms. They can work hand-in-hand or they can be at odds. Some of the icons of the social entrepreneurship movement have spoken harshly about charity, yet most of (...) them rely to some degree, at least early in their development process, on resources that are given out of a charitable impulse. The success of social entrepreneurship requires an integration of values from each of these cultures, in which the satisfactions of giving are correlated with social benefits of rigorous problem solving. (shrink)

Although stakeholder theory is concerned with stakeholder engagement, substantive operational barometers of engagement are lacking in the literature. This theoretical paper attempts to strengthen the accountability aspect of normative stakeholder theory with a more robust notion of stakeholder engagement derived from the concept of good faith. Specifically, it draws from the labor relations field to argue that altered power dynamics are essential underpinnings of a viable stakeholder engagement mechanism. After describing the tenets of substantive engagement, the paper draws from the (...) labor relations and commercial law literatures to describe the characteristics of good faith as dialogue, negotiation, transparency, and totality of conduct; explains how they can be adapted and applied to the stakeholder context; and suggests the use of mediation and non-binding arbitration. The paper concludes by addressing anticipated objections and shortcomings and discussing implications for theory and research. (shrink)

This article presents a critical examination of the process of stakeholder dialogue in the Corporate Social Responsibility (CSR) field. It utilises data from a three-year research project into stakeholder dialogue processes to discuss three central themes: first, what is meant by the term ‘dialogue’, both from a theoretical perspective and from its practical application within CSR; second, the challenges of creating effective dialogue; and third, measuring and assessing the potential outcomes of dialogue. In providing a critical overview of these themes, (...) the article examines the nature of organisational learning through stakeholder engagement and dialogue. It questions the motives behind engagement in dialogue and highlights some of the potential challenges for organisational learning posed by opting for a stakeholder dialogue approach. It argues that organisations engaging in stakeholder dialogue must have a clear understanding of the implications of undertaking a dialogue process and have a long-term perspective regarding the outcomes and learning likely to emerge from it. While stakeholder dialogue may produce significant results, it is argued, many of these may be difficult to quantify on a short-term basis. (shrink)

This article presents results of exploratory research conducted with managers from over 500 Norwegian companies to examine corporate motives for engaging in social initiatives. Three key questions were addressed. First, what do managers in this sample see as the primary reasons their companies engage in activities that benefit society? Second, do motives for such social initiative vary across the industries represented? Third, can further empirical support be provided for the theoretical classifications of social initiative motives outlined in the literature? Previous (...) research on the topic is reviewed, study methods are described, results, are presented, and implications of findings are discussed. The article concludes with the analysis of study limitations and directions for future research. (shrink)