This study provides preliminary empirical evidence that shareholder activists target companies because of their size as well as specific stakeholder-related practices. The data show that shareholder activists target companies with shareholder resolutions demanding changes in corporate behaviors for companies producing problematic products and where environmental concerns exist. Furthermore, companies in specific industries are targeted based on poor employee and community-related practices. Activists, that is, are selective in their targeting of companies, choosing the most visible (largest) companies and those whose practices (...) raise specific issues of interest to society. (shrink)

If stakeholder theory is to become a full theory of business—society relationships, it will have to develop a better understanding of processes by which stakeholders may gain and hold influence over firms. A better understanding of the political processes involved is required. This paper—as well as the papers in this special issue—takes a political `view' to addressing the issue, and thereby extends the currently dominant demographic and structural approaches. It suggests that the influence of stakeholders over firms is the temporary (...) outcome of processes of action, reaction, and interaction among various parties. Consequently, the further advancement of stakeholder theory would benefit from the adoption of process-research methods and thinking. (shrink)

In this article, we document the growing influence of non-governmental organizations (NGOs) in the realm of socially responsible investing (SRI). Drawing from ethical and economic perspectives on stakeholder management and agency theory, we develop a framework to understand how and when NGOs will be most influential in shaping the ethical and social responsibility orientations of business using the emergence of SRI as the primary influencing vehicle. We find that NGOs have opportunities to influence corporate conduct via direct, indirect, and interactive (...) influences on the investment community, and that the overall influence of NGOs as major actors in socially responsible investment is growing, with attendant consequences for corporate strategy, governance, and social performance. (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)

If stakeholder theory is to become a full theory of business—society relationships, it will have to develop a better understanding of processes by which stakeholders may gain and hold influence over firms. A better understanding of the political processes involved is required. This paper—as well as the papers in this special issue—takes a political `view' to addressing the issue, and thereby extends the currently dominant demographic and structural approaches. It suggests that the influence of stakeholders over firms is the temporary (...) outcome of processes of action, reaction, and interaction among various parties. Consequently, the further advancement of stakeholder theory would benefit from the adoption of process-research methods and thinking. (shrink)

Many firms, especially transnational corporations, find it increasingly difficult to predict and handle conflicts with external interest groups. In addition to a set of established stakeholders, they face a complex arena of newly emerging “stakeseekers” who also claim to have a stake in the corporation's decision making. Corporations seek to establish relationships with such groups to anticipate and prevent conflicts that could otherwise wreak havoc on their reputation. Through stakeholder engagement, stakeseekers may be turned into stakeholders. It has been argued (...) that in the process, critics are simply co-opted. However, corporate objectives are not necessarily monolithic. Conceived as a political coalition of various interests, the structure of the corporation often reflects societal divisions. Parts of the corporation can thus serve as sounding boards for external claims. Referring to the case of Royal Dutch/Shell in particular, this article shows how a political coalition perspective on the corporation may help to understand and analyze the politics of stakeholder influence. (shrink)

Multinational corporations (MNCs) are the frequent target of nongovern-mental organizations (NGOs) in their advocacy efforts. In this article, the author examines NGO advocacy as it occurs in the NGO network and, using insights from the political science literature in conjunction with the resourcebased view of the firm, posits that NGO intranetwork conflict will result in a skewing of corporate social responsibility practices by the multinational corporation toward the MNC's developed country stakeholders. This skewing is a product of the asymmetric accountability (...) of NGOs (upwardly accountable to donors, downwardly accountable to recipients). Developing country government and MNC strategies in the face of such skewing are discussed. (shrink)

This article aims to deepen the understanding of the processes and specific actions aimed at influencing and shaping business practices through dynamic stakeholder relationships. An inductive, longitudinal study of all players involved in a stakeholder conflict identified four clusters of influence tactics that were used by both secondary stakeholders and their target firms: issue raising, issue suppressing, positioning, and solution seeking. The stakeholders studied built elaborate influence chains and worked to direct influence flows. The study contributes to stakeholder theory by (...) offering a refined understanding of both bilateral and mutual-influence tactics, expanding the theory's focus beyond bilateral relationships, and highlighting the use of dependence relationships among multiple embedded organizations to build influence over a specific target, and more generally, an organizational field. These findings are discussed in light of work on social movement organizations and institutional theory. (shrink)