Stakeholders in perspective

186 Pages·2005·1.53 MB·English

by  Yvon Pesqueux

cg special issue cover.qxd 9/9/04 3:29 PM Page 1
ISBN 1-84544-037-4 ISSN 1472-0701
Volume 5Number 2 2005
Corporate
Governance
The International Journal
of Business in Society
Stakeholders in perspective
Guest editor: Yvon Pesqueux
A partnership projectfrom:
With the supportof:
www.emeraldinsight.com
Table of contents
Special issue: Stakeholders in perspective
Guest editor: Yvon Pesqueux
Volume5Number22005
Departments Feature articles
Access this journal online 2 Stakeholder theory in perspective 5
YvonPesqueuxandSalmaDamak-Ayadi
Editorial 3
A critique of stake-holder theory: management science or a
sophisticated ideology of control? 22
ElenaP.AntonacopoulouandJe´roˆme Me´ric
Some philosophical issues in corporate governance:
the role of property in stakeholder theory 34
MariaBonnafous-Boucher
Human rights as a normative basis for stakeholder legitimacy 48
BertvandeVen
Towards the relational corporation: from managing stakeholder
relationshipstobuildingstakeholderrelationships(waitingforCopernicus) 60
JosepM.Lozano
In search of new organizational values: the irruption of beauty in
an entrepreneurial creation 78
Herve´ Colas
Changing managers’ values towards a broader stakeholder orientation 89
SybilleSachsandEdwinRu¨hli
Stakeholder theory, society and social cohesion 99
Franc¸oisLe´pineux
State as a stakeholder 111
SibelYamakandO¨mu¨rSu¨er
The stakeholders’ perspective on the international business school 121
AlbertSta¨hli
Towards a stakeholder responsible approach: the constructive role
of reporting 130
StefanoZambonandAdeleDelBello
Organizations which make a difference: a philosophical argument for
the ‘‘people focused organization’’ 142
EdWeymes
The measurement of responsible governance and management of
NPOs in New Zealand: an evaluation tool for NPOs, donors and
government. ‘‘If you have no money – you have no mission’’ 159
J.Mueller,D.Williams,A.Higgins andM.Tou
Lead, respond, partner or ignore: the role of business schools on
corporate responsibility 174
LouiseGardiner andPeterLacy
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VOL.5NO.22005,p.1, EmeraldGroupPublishingLimited,ISSN1472-0701 CORPORATEGOVERNANCE PAGE1
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Editorial
A sthePresidentoftheEuropeanAcademyofBusinessinSociety(EABIS)andDirector
GeneralandCEOoftheEuropeanFoundationofManagementDevelopment(EFMD)
we would like to warmly welcome you to this special joint edition of the Corporate
Governance Journal.
Wewouldparticularlyliketothankthisspecialedition’seditor,YvonPesqueux,forallhishard
work in pulling this project together. We would also like to thank the journal’s regular editor
NadaKakabadse andtheteamatEmerald,aswellasMatthewWoodfromEFMDandPeter
Lacy of EABIS.
EABIS and EFMD: a shared vision
The publication of this special joint edition is a demonstrable sign of the ongoing spirit of
partnership between EABIS and EFMD in working towards a commonly held goal: to raise
thebaronknowledgeandskillsonbusinessinsociety.Webothrecognizethatforbusinessto
be able to create sustainable commercial and societal value, it will need managers with the
knowledgeandskillstodoso.Inourpartnership,EFMDandEABISleverageandcombineour
respective strengths to create a cohesive and ‘‘joined up’’ approach to this issue.
Corporate responsibility in European business education: where are we now?
TheintegrationofcorporateresponsibilityintoEuropeanbusinesseducationisatanimportant
crossroads.Manyschoolshaveresponded,insomeshapeorform,tothechallengelaiddown
by business for the development of new types of management education that deal with
corporate responsibility as an integral part of business operations. However, when looking at
theissuefromabroader,pan-Europeanperspective,ourexperiencehasshownusthatthereis
stillalongwaytogoinachievingtrueintegrationofcorporateresponsibilityintothemainstream
business curriculum.
This was clearly demonstrated by the results of Europe’s first comprehensive assessment of
business in society teaching and research, conducted by Nottingham University Business
School’sInternationalCentreforCorporateSocialResponsibility,inconjunctionwithEABISand
EFMD. The survey revealed that corporate responsibility is being included in some business
education and research, but this is happening in isolated pockets of activity, often led by a
specificscholarataspecificschool.Whatislackingisacoherentinstitutionalcommitmentto
theseissuesfromschoolleadershipdownwards.Furthermore,manyschoolshaveadopteda
‘‘stand alone’’ framework for including business in society issues in their curriculum, through
either compulsory or elective specialist modules: an approach in contradiction to the view of
enlightenedcompaniesthatseecorporateresponsibilityasanintegralpartofallcorebusiness
operations.
Schools are also overlooking the value of an inter-disciplinary approach to the issue of
corporateresponsibility:thetraditionaldivisionsbetweendisciplinesatbusinessschoolsandat
theirassociateduniversitiesoftenobstructcollaborationonanissuewhich,byitsverynature,
requiresadiverseapproachacrossdifferentdisciplines.Thislackofdiversitycanalsobeseen
in the scarcity of creative thinking regarding the teaching methods employed by business
educators in corporate responsibility. Given the diverse social and economic nature of the
subject,thetraditionalboundariesofteachingneedtobepushedbacktomakewayfornew
forms of cognitive and experiential learning.
Business – academic partnerships
Acreativeapproachisalsorequiredinshapingthecorporateresponsibilityissuesincludedin
themanagementeducationagenda.Inordertopreparestudentsfortherealworldsituations
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VOL.5NO.22005,pp.3-4, EmeraldGroupPublishingLimited,ISSN1472-0701 CORPORATEGOVERNANCE PAGE3
they will inevitably encounter and to develop the future managers they will need, business
needstoworkwithitseducatorstofeedpracticalknowledgeand‘‘reallife’’issuesconcerning
corporate responsibility into contemporary management education.
So far, though, cooperation between the academic and business communities has been
slowanduneven.AtEABISandEFMDwehavebeenforgingnewmethodsofaddressingthis
disconnect between supply and demand on business in society education. We draw on the
EABISnetworkofleadingEuropeancompanies,businessschoolsandotherkeystakeholders,
and the EFMD global network of over 500 international business schools and companies to
develop collaborative and innovative solutions for integrating corporate responsibility into
business theory and practice.
Ourjointexperiencehashighlightedsomekeylearningsonbusiness–academicpartnerships.
AsPeterLacy,EABISExecutiveDirector,touchesoninhisarticlelaterinthisedition,business
schoolshaveseveraloptionsastohowtheycanchooseto‘‘lead,respond,partnerorignore’’
their role on corporate responsibility. Due to the nuances of corporate responsibility across
geographies and industry sectors, there can be no one prescriptive approach to this issue
in business education. What is essential is that business schools work in partnership with
companiestoensuretheyadoptabalancedandbusinessrelevantapproachthatbringsvalue
through diversity.
Conclusion
In today’s global economy, the social impact of business is being felt on an ever-increasing
scale. Business schools, therefore, not only have an essential part to play in developing
businessleadersthathavetheskillsandknowledgetomanagethisimpact,buttheyalsoplay
apartinsettingtheagendaforbusiness’futureroleinsociety.Assuch,corporateresponsibility
isstartingtotakeonnewmeaninginthemindsofsomebusinesseducators,andenlightened
business schoolsrealize that corporateresponsibility, andwith itacommitmenttocombined
economic, environmental andsocial growth, willonly progresstothe next stageofsustained
value creation through effective knowledge and learning partnerships. However, we are now
merelyatthestartofthelearningcurve,andthereisalongwaytogobeforebothcompanies
andbusiness schoolsfindwaystoembedcorporate responsibilityas justanotherelement of
‘‘business as usual’’.
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PAGE4 CORPORATEGOVERNANCE VOL.5NO.22005
Stakeholder theory in perspective
Yvon Pesqueux and Salma Damak-Ayadi
YvonPesqueuxisaProfessor AbstractThosewhousestakeholdertheoryasareferencearebothunderliningthecorrelation
andHolderofthe‘‘Development betweenfactsandacertainconceptualizationthereof,andtryingtomakethenecessaryshift
ofOrganisationalSystems’’ froma‘‘panoptic’’analysisakintoapanoramicvisionoftextsandpositions,toan‘‘in-depth’’
ChairatCNAM,Paris,France. one geared towards an understanding of their foundations. As a ‘‘theory of organizations’’,
Tel:[phone], stakeholder theory helps tonourish arelational model oforganizations by revisiting questions
Fax:[phone], about ‘‘who’’ is actually working with (and in) the firm. Stakeholder theory is part of a
E-mail:[email protected] comprehensiveprojectthatviewstheorganization-grouprelationshipasbothafoundationand
SiteWeb:www.cnam.fr/lipsor
a norm.
SalmaDamak-Ayadiisan
AssociateTeachingandResearch Keywords Business ethics, Stakeholders, Management theory
FellowandPhDstudentatthe
EuropeanCentreforResearchin
FinanceandManagement Introduction
(CREFIGE)atUniversite´ deParis
Stakeholdertheoryhasbecomethefocalpointofagreatmanydebates.Itfrequentlyservesas
IXDauphine,Paris,France.
apointofreferenceinagents’discourses,intheiractsandinahostof‘‘managementscience’’
E-mail:[email protected]
studies (and even political analyses). Its current tendency is to impose itself as a point of
referencebyimitatingcorporatesocialresponsibilitypolicies,tosuchanextentthatithastaken
on the allures of a dominant discourse.
This explains the proliferation of false arguments currently circulating on this subject. The
purpose of the present text will be to recall those elements of comprehension that are a
requisite inany references to stakeholder theory, and to suggest elements of evaluation. The
questionweultimatelyaskiswhetheritisbecauseofstakeholdertheory’sapparentfacilitythat
itissopleasing–eventhoughitsfalseevidencemayinfactbemaskingambiguitiesthatcould
lead many analysts astray, whether or not they lend any credence to this school of thought.
This theory constitutes a core issue in ‘‘pseudo’’ disputes today, a state of affairs attesting
to the status of ‘‘the serious thing’’ that is the firm, and translating the existence of an US
intellectualisminthefieldofmanagementsciences.Textsderivedfromsuchdiscussionshave
goneforthandmultiplied,fillingupourlibrarieswithcross-referencesandbooksynopses,and
with‘‘reviewers’’andalternatively‘‘reviewees’’happytojoinoneortheotherofthecategories
underpinningthisconstructionof‘‘academiccapitalism’’.Intruth,theverysamecriticismcan
alsobemadeofthepresenttext,eventhoughitsambitionistopositiontheelementsneededto
‘‘decode’’stakeholdertheoryatalevelbeyondtheevidentialonethatwouldappeartobeitslot.
Theveryexpression‘‘stakeholder’’hasbecomesowidespreadtodaythatmanypunditshave
forgottenthatitfirstaroseintheUSAasaliberalreaction(rememberthatwhatourUSfriends
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DOI10.1108/14720700510562622 VOL.5NO.22005,pp.5-21, EmeraldGroupPublishingLimited,ISSN1472-0701 CORPORATEGOVERNANCE PAGE5
call‘‘liberal’’iswhatwewouldcalloppositional)totheprimacybeingbestoweduponfinancial
value,ledbythefigureoftheshareholder–aprimacythatbecamelegitimateduringPresident
Reagan’s time in office. Here it is worth remembering the operation suggested by Ricoeur
(1997) in the title of his book devoted to questions of ideology: utopia asks questions where
ideology legitimizes, in which case stakeholder theory plays the role of a utopia. However,
Ricoeur also warns us against the way in which utopia is co-opted by ideology. This is yet
another issue we will have to deal with, given stakeholders’ presence inside of the old
managerial utopia of agonism[1], i.e. the utopia of refusing to recognize the existence of
antagonisms in the firm. Workers, shareholders, we are all in it together!
Note first of all the speed with which this corpus has developed, as witnessed by the
proliferation of articles and conferences on this subject. Academic research has reserved a
special place for stakeholder theory over the past few years. According to Donaldson and
Preston (1995), more than 100 articles and a dozen books have been devoted to this topic,
with most having been published in reviews like Business Ethics Quarterly and Academy
ofManagementReview.However,whentakenoutofitsUSculturalcontext,the stakeholder
conceptbecomesarelativelyvagueone.Itbenefitsfroman‘‘imperialist’’effectrelatingbothto
thefactthatitbelongstothefieldofmanagementsciencesandalsotoitsUSorigins.Theidea
here is management sciences are so indebted to US sources that it might as well accept
the stakeholder construct without any further to do ... Yet culturalist understanding is rich
with potential. Stakeholder theory could be construed as existing along the same lines of
understanding as those that we inherited from de Tocqueville (1835), with his vision of US
democracyandits‘‘heritageofpiousmerchants’’whoseinterestscanbestbeseeninthelight
oftheir‘‘moralequality’’.ItmayalsobecongruentwiththevisionthatMaxWeberdescribedin
1904 when commenting on Benjamin Franklin’s 1748 opus, Advice to a Young Tradesman.
Whatweshouldnotforgetistheabsenceofthisfigureofthetradesman(orofhismoregeneric
version, the businessman) in Continental Europe, where the bourgeois was much more of a
reference point.
AccordingtoMercier(1999),stakeholdersare‘‘alloftheagentsforwhomthefirm’sdevelop-
mentandgoodhealthareofprimeconcern’’.Freeman(1984)definesthemas‘‘anygroupor
individual thatcan affect orbeaffected by therealizationofacompany’sobjectives’’.Ethical
considerationsarewhathavedrivenstakeholdertheory’srise,havingbeendeployedasaway
of constructing its normative aspect (the idea being that we are all stakeholders).
For Donaldson and Preston (1995), stakeholders are defined by their legitimate interest in an
organization. This implies that:
J claimantsaregroupsorpersonswithlegitimateinterests;thattheyareknown;andthatthey
have been identified; and
J all stakeholder groups’ interests have at least a modicum of intrinsic value.
Nowadays (Caroll, 1989), we usually distinguish between:
J ‘‘primary’’ stakeholders, referring to those actors who entertain a direct and contractually
determinedrelationship,asthenameindicates,withthecompany(andwhoaresometimes
still called ‘‘contractual’’ stakeholders); and
J ‘‘secondary’’stakeholders,combiningactorswhoaresituatedatthebordersofafirmand
whomaybeimpactedbyitsactionswithouthavinganycontractualconnectiontoit(agroup
that is still described as ‘‘diffuse’’ sometimes).
Otherdistinctionsexistaswell,includingbetweeninternalstakeholders;‘‘traditional’’external
ones;andotherexternaloneswiththepowertoinfluencematters.PelleCulpin(1998)offersa
furtherdistinctionbetweeninstitutionalstakeholders(thoseinvolvedinlaws,regulations,inter-
organizationalentities,plusprofessionalorganizationsthatmaybespecifictoagivenindustry);
economic stakeholders (actors operating in the markets of the company in question); and
‘‘ethical’’ stakeholders emanating from ethical and political pressure groups (a group whose
figuration may be more difficult to define).
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PAGE6 CORPORATEGOVERNANCE VOL.5NO.22005
Thosewhousestakeholdertheoryasareferencearebothunderliningthecorrelationbetween
facts and a certain conceptualization thereof (section 1), and trying to make the necessary
shift froma ‘‘panoptic’’ analysis akinto apanoramic vision oftexts and positions(section 2),
toan‘‘in-depth’’onegearedtowardsanunderstandingoftheirfoundationsandhighlightingits
ambiguities (section 3).
1. Correlation between facts and conceptualization
As indicated by Le´pineux (2003), stakeholder theory sprang out of a maelstrom of ‘‘affairs’’.
In1967,communitygroupsintheUSAinvitedthemselvestoanEastmanKodakAGMagainst
a backdrop of racial tension and mass unemployment among Greater Cleveland’s black
population.IntheUSAagain,consumerorganizationsinvitedthemselvestoaGeneralMotors’
1970AGMtocomplainaboutsafetydefectsonthecarsbeingsold,andtoaskotherquestions
about group social practices. The grilling of GM’s board of directors received a great deal of
media airtime. Both of these ‘‘generating facts’’ attest to the significance that executives in
these large companies attached to the ‘‘societal’’ dimension, and to shareholder activism’s
potential for criticism.
In the UK in 1997, several shareholders began to ask questions about the political nature of
Shell’s relationships with the Nigerian government of the time, thereby highlighting a whole
series of human rights and environmental protection issues. This ‘‘affair’’ is considered the
starting point for stakeholder governance, i.e. for the emergence of shareholder activism.
1.1.Stakeholders andcorporate governance
Factsofthisilk(someofwhicharestillimbuedwithasymbolicdimension)aretheforcesthat
gave birth to the shareholder capitalism-stakeholder capitalism debate for which stakeholder
theory has been a bedrock (Friedman, 1970; Jensen, 2002). Corporate governance issues
highlightanyandallrelationshipsthatmayexistbetweenafirmanditspartners.Inotherwords,
they have contributed greatly to the development of stakeholder theory’s practical aspects.
1.2.Countingallstakeholders
The stakeholder issue raises questions about how such parties are to be counted. Le´pineux
(2003) suggests classifying them into different categories of actors:
J shareholders;
J internalstakeholders(employees;laborunionsfocusedonissuessuchasemployees’direct
and indirect participation – via their pension funds – in the firm’s capital structure, and
on issues pertaining to union representation and/or to a shareholder activism that can be
implemented either working alone or else with other investors who also want to get their
resolutions adopted);
J operational partners (customers; suppliers – including subcontractors; banks acting as
creditors but also as parties that expect stability and solvency; and insurance companies
having to contend with classes of risk currently undergoing a substantive and in-depth
renewal, i.e. ‘‘greater’’ catastrophes related with climatic changes today); and
J the social community (state authorities; specialized organizations like trade unions; non-
governmental organizations; and civil society).
For this latter category, NGO interventions were what first triggered the current debate.
Oneexampleisthedenunciation oftheenvironmentalspoliationbeingcausedbyoil,mineral
and chemical companies, etc. (air andwater pollution, deforestation, toxic waste, etc.). Well-
publicized trials by media have progressively mutated into greater collaboration with the
companiesinvolved.ModernNGOsuniteahostofdifferententitiesthatcanbequitedisparate
in nature, both in terms of their scope and also as regards their geographic reach (with the
largestonesbeingstructuredintointernationalnetworks).Moreover,theirareasofcompetency
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VOL.5NO.22005 CORPORATEGOVERNANCE PAGE7
haveexpandedfromgreenissuesinthe1980stoincludehumanrightsnow,suchastheseare
conceived of by the ‘‘stakeholder’’ concept using the ethical and political precepts it tries to
apply.
1.3.Theambiguity of‘‘socialcommunity’’whenseenas something‘‘singular’’or‘‘plural’’
TheUSconstructof‘‘community’’isoftenmentionedasoneofthestakeholdersinregardsto
which firmsare supposed tobehaveresponsibly. Waddockand Boyle(1995) notedashift in
focus from relationships geared towards a single (close) community, towards more complex
relationshipswithamultitudeofcommunitiesthatcanbebothcloseandmoredistant.Thisshift
hasledtogreaterrelianceonthestakeholderconcept.Thechallengehereishowtodefinethe
communityinitsstakeholderform(Altman,2000)insuchawayastoaccountforthemultiplicity
ofgroupsconcerned,whilecoveringwhatevertheymayhaveincommonamongthemselves
(as well as the modalities for managing such relationships).
1.4.Stakeholders’ changingactionmodes
Le´pineux (2003) tried to classify these relationships by distinguishing between:
J theshiftfromdialoguetopartnership(i.e.NGOrepresentatives’presenceindecision-making
processesand/ortheacquisitionofsharessoastohavetherighttoquestionexecutivesat
AGMs – all portrayed as shareholder activism in full flow); and
J the proliferation of the sorts of instruments of pressure that can be brought to bear within
a conflictual context, including suggesting resolutions at AGMs, hijacking a company’s
communications resources (‘‘right-wrong’’ Web sites, counter-advertising, etc.) opinion-
shaping campaigns, organizing boycotts and lawsuits.
Butstakeholdertheoryisdifferentfromamereclassificationexercise.Asshownbyananalysis
of the texts comprising this school of thought, it is in fact a plan to rearrange the theory of
organizationsbyincorporatingethicalperspectivesor,ifoneprefers,byenhancingsaidtheory.
2. A ‘‘panoptic’’ analysis of stakeholder theory
Before suggesting any investigations of the field covered by stakeholder theory, we should
remember its postulates:
J Anorganizationwillmaintainrelationshipswithseveralgroupsthataffectorareaffectedbyits
decisions (Freeman, 1984).
J Theorywillbedependentonthenatureofsuchrelationshipsbecauseofthewayinwhichthe
processes involved, and the outcomes achieved can affect society and stakeholders.
J Stakeholders’ interests have some intrinsic value, but no one interest should be able to
dominate all of the others (Clarkson, 1995; Donaldson and Preston, 1995).
J Theory is interested in managerial decisions (Donaldson and Preston, 1995).
In regards to the concept of (corporate social) responsibility, stakeholder theory has two
variants:
J Thefirstrelatestotheempiricalnatureofresponsibility.Theoryhereisbasedontheideathat
an organization’s interests are the first to be taken into account, and that its subsequent
efforts are then ‘‘divided’’ up among its various stakeholders in a way reflecting their
respective levels of importance. Here information is seen as a crucial element allowing the
organizationto‘‘manage’’itsrelationships:attheveryleasttoavoidstakeholderopposition;
and where possible to gain their adherence.
J The second relates to the organization-stakeholders relationship, conceived of here as a
socialrelationshipimplyingthegenesisofanorganization’sresponsibilitytoitsstakeholders.
This is a normative approach to responsibility.
The article by Donaldson and Preston (1995) offers a taxonomy of the different stakeholder
theoriesbyplacingthemintothreeseparatecategories.Basedonthefollowingelements,this
taxonomy has served ever since as a benchmark for this field:
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PAGE8 CORPORATEGOVERNANCE VOL.5NO.22005
J Firms and managers act with moral perspectives in mind (category 1, which is normative).
J Achieving results becomes more doable if managers act with moral perspectives in mind
(category 2, which is empirical and instrumental).
J Organizationsandmanagersbehavewithspecifiablemoralperspectivesinmind(category3,
which is empirical and descriptive).
JonesandWicks(1999)thinkthatthistypologyhelpstodelineatetheintellectualareasthatare
coveredbystakeholdertheory’stwofoundingschools:theempiricalstakeholdertheory(based
on descriptive and instrumental perspectives); and the normative theory (based on ethics).
Hencetheirsuggestion,aboveandbeyondtheaforementioned‘‘disputes’’,ofa‘‘convergent’’
stakeholder theory predicated on the following arguments:
J Postulates:organizationsoperatepubliclyinaneconomicmarketplacethatcanbedescribed
ascompetitive;decisionsaretakenbyprofessionalmanagers;andbehaviorsarecontingent
(on circumstances and contexts).
J Theory focuses on the manager-stakeholder relationship, which is deemed to have moral
foundations.
J Atthesametime,theoryisalsoempiricalandnormativesinceitofferspracticalresults,i.e.
describable norms.
Itremainsthatthisperspectivehasbeencriticizedaslackinginformalconstructionorempirically
testable variables (Donaldson, 1999; Trevino and Gray, 1999).
Another distinction traverses this corpus (Mitchell et al., 1997) between those who refer to
stakeholders as representatives of a moral or economic interest (with ‘‘diffuse’’ stakeholders
not necessarily entering the equation).
2.1.Isstakeholder theoryempiricalinnature?
This initial question requires first of all a precise delineation of the framework that surrounds
stakeholder theory in its two variants.
2.1.1.Descriptive stakeholder theory
Thisisthe thesis that Donaldsonand Preston(1995)put forward. Intheir opinion, this theory
considers that organization is what one finds at the center of cooperation and competition
situations, each of which possesses its own intrinsic value.
Herethetheoryisbeingusedtodescribe(andsometimestoexplain)specificcharacteristicsand
behaviors, includingforexamplefirms’nature (BrennerandCochran,1991),howexecutives’
managementoftheirfirmsshouldbeconceivedof(BrennerandMolander,1977),howsome
organizationsareactuallybeingmanaged(Halal,1990;Clarkson,1991;KreinerandBhambri,
1991), the diffusion of societal information (Ullmann, 1995; Pelle Culpin, 1998), the notion
of target stakeholders (Mitchell et al., 1997) and the significance attributed to each stake-
holder,somethingthatwillvarydependingonthephasethatafirmhasreachedinitslifecycle
(Jawahar and Mclaughin, 2001).
This descriptive approach only allows for exploratory propositions, however. It does not
enableanyconnectiontobemadebetweenstakeholdermanagementandtraditionalbusiness
objectives (growth, earnings, etc.).
2.1.2.Instrumentalstakeholder theory
Instrumental stakeholder theory was advanced by Jones (1995). The main idea here is that
everythingelsebeingequal,firmsthatpracticestakeholdermanagementwillperformbetterin
profitability,stability,growth,etc.terms.Oneacceptsthat‘‘certain’’resultscanbeobtainedif
‘‘certain’’ behaviors are adopted. In other words, the instrumental theory is a contingent one
(meaning that it involves reliance on certain types of behavior).
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