Winston evaluates strategies that have been used by international human rights nongovernmental organizations in attempts to influence the behavior of multinational corporations.

In this article we revisit the notion of stakeholder responsibility as a way to highlight the role that stakeholders have in creating anethical business context. We argue for modifying the prevailing focus on corporate responsibility to stakeholders, and giving more serious attention to the importance of stakeholder responsibility—to firms, and to other stakeholders who are part of the collective enterprise. We elaborate why stakeholder responsibility matters, and suggest how making stakeholder responsibility a central focus of academics and practitioners can redefine (...) the interaction between firms and stakeholders and ultimately enhance business excellence. (shrink)

Are the strategies and tactics that pressure groups use against businesses ethically defensible?

Stakeholder theory has become a central issue in the literature on business ethics / business and society. There are, however, a number of problems with stakeholder theory as currently understood. Among these are: 1) the lack of a coherent justificatory framework, 2) the problem of adjudicating between stakeholders, and 3) the problem of stakeholder identification. In this essay, I propose that a possible source of obligations to stakeholders is the principle of fairness (or fair play) as discussed in the political (...) philosophic literature of Rawls, Simmons, and Cullity among others. The principle of fairness states that, “Whenever persons or groups of persons voluntarily accept the benefits of a mutually beneficial scheme of co-operation requiring sacrifice or contribution on the parts of the participants and there exists the possibility of free-riding, there exist obligations of fairness on the part of these persons or groups to co-operate in proportion to the benefits accepted.” In this essay I discuss the gaps in the current stakeholder literature, elucidate and defend a principle of fairness that fills the gap, compare the fairness model to other similar models of business ethics, and draw some conclusions for the future of stakeholder theory. (shrink)

The pharmaceutical sector, an industry already facing stiff challenges in the form of intensified competition and strategic consolidation, has increasingly become subject to a range of pressures. Crucially, in common with other large-scale businesses, pharmaceutical firms find themselves ‹invited’ to respond positively to the corporate ‹social’ responsibility (CSR) expectations of their stakeholders. Consequently, individual managers will almost certainly be obliged to engage in some form of stakeholder dialogue and this, in turn, means that they will have to make difficult choices (...) about which practices to adopt. This real-world management predicament runs parallel to an academic interest in CSR stakeholder dialogue theory and models. Accordingly, the approach of this paper is to focus primarily on the academic debate surrounding stakeholder dialogue, by reviewing past attempts to research and theorise the subject, by identifying gaps and weaknesses in the literature, and by proposing a new analytical model. The central aim of the proposed new model is to offer a unified, structured, systematic, and comprehensive approach to CSR decision making whilst simultaneously providing a practical framework for CSR executives who face the challenge of responding in an effective manner to stakeholders. The model outlined here is currently being employed to conduct international comparative empirical research into stakeholder dialogue practices amongst UK and German pharmaceutical firms. In the longer term the intention is to use the model to undertake international comparative research encompassing a broader range of countries and industries. (shrink)

In this article I examine corporate social reporting as a form of New Governance regulation termed “democratic experimentalism.” Due to the challenges of regulating the behavior of corporations on issues related to sustainable economic development, New Governance regulation—which has a focus on decentralized, participatory, problem-solving-based approaches to regulation—is presented as an option to traditional command-and-control regulation. By examining the role of social reporting under a New Governance approach, I set out three necessary requirements for social reporting to be effective: disclosure, (...) dialogue with stakeholders, and the moral development of the corporation. I then assess current social reporting practices against these requirements and find significant problems. In response, I propose one option for solving those problems, and encourage future researchers to consider the demands of these three requirements and the possible trade-offs between them when attempting to find ways to improve social reporting practices. (shrink)

In this article I examine corporate social reporting as a form of New Governance regulation termed “democratic experimentalism.” Due to the challenges of regulating the behavior of corporations on issues related to sustainable economic development, New Governance regulation—which has a focus on decentralized, participatory, problem-solving-based approaches to regulation—is presented as an option to traditional command-and-control regulation. By examining the role of social reporting under a New Governance approach, I set out three necessary requirements for social reporting to be effective: disclosure, (...) dialogue with stakeholders, and the moral development of the corporation. I then assess current social reporting practices against these requirements and find significant problems. In response, I propose one option for solving those problems, and encourage future researchers to consider the demands of these three requirements and the possible trade-offs between them when attempting to find ways to improve social reporting practices. (shrink)

In the present study, I sought to more fully understand stakeholder organizations’ strategies for influencing business firms. I conducted interviews with 28 representatives of four environmental non-governmental organizations (ENGOs): Natural Resources Defense Council (NRDC), Greenpeace, Environmental Defense (ED), and Union of Concerned Scientists (UCS). Qualitative methods were used to analyze this data, and additional data in the form of reviews of websites and other documents was conducted when provided by interviewees or needed to more fully comprehend interviewee’s comments. Six propositions (...) derived from Frooman (1999) formed the basis for the initial data analysis; all six propositions were supported to some extent. Perhaps more interestingly, the data revealed that Frooman’s model is too parsimonious to adequately describe stakeholder influence strategies and related alliances, necessitating the development of an alternative theoretical model grounded in the data collected. (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)

In this article we revisit the notion of stakeholder responsibility as a way to highlight the role that stakeholders have in creating anethical business context. We argue for modifying the prevailing focus on corporate responsibility to stakeholders, and giving more serious attention to the importance of stakeholder responsibility—to firms, and to other stakeholders who are part of the collective enterprise. We elaborate why stakeholder responsibility matters, and suggest how making stakeholder responsibility a central focus of academics and practitioners can redefine (...) the interaction between firms and stakeholders and ultimately enhance business excellence. (shrink)

Despite the recent increase in interest in corporate social responsibility and the propagation of corporate governance in both business and academic literature, from observations of actual practice, the author has seen at all company levels, in everyday operations, instances of non-ethical behaviour vis-à-vis the whole gamut of stakeholders. This state of affairs is linked with: pressure from stakeholders, short-term tactics, hegemony of financial considerations, ‘juridisation’ of business, the tyranny of communications and the media and the difficulties in translating strategy into (...) practical implementation. The paper scrutinises the motivation and the psychology of entrepreneurs and business people, and their behaviour is compared to other professional groups and confronted with the decline in ethics in society as described by some important observers. The conclusion drawn is that the recent positive evolutions do not provide sufficient ethical guidelines for the day-to-day activities of middle managers and entrepreneurs in the present competitive environment. Managers will always be confronted by difficult choices with ethical dilemmas. There will always be a tension between theory and pragmatism, but progress can be made with the effective implementation of the ethical discourse in companies. To achieve this, ethical management should not be confined to the large strategic issues but also applied to the small practical matters of everyday business life. Ethics in business and entrepreneurship requires more than corporate governance and corporate social responsibility (CSR). (shrink)

The success of the stakeholder theory in management literature as well as in current business practices is largely due to the inherent simplicity of the stakeholder model––and to the clarity of Freeman’s powerful synthesised visual conceptualisation. However, over the years, critics have attacked the vagueness and ambiguity of stakeholder theory. In this article, rather than building on the discussion from a theoretical point of view, a radically different and innovative approach is chosen: the graphical framework is used as the central (...) perspective. The major shortcomings of the popular stakeholder framework are systematically confronted with the graphical scheme to illustrate their visual impact. The graphical illustrations of the imperfections help explain the sometimes-oversimplified generalisation inherent to every graphical model. They also make some interrelationships easier to understand. The analysis demonstrates that, with the tacit but implicit acceptance of simplification of the discussed explanatory elements, Freeman’s framework remains a rather good approximation of reality. Only a few minor changes to the stakeholder model are consequently proposed. (shrink)

The success of the stakeholder theory in management literature as well as in current business practices is largely due to the inherent simplicity of the stakeholder model-and to the clarity of Freeman's powerful synthesised visual conceptualisation. However, over the years, critics have attacked the vagueness and ambiguity of stakeholder theory. In this article, rather than building on the discussion from a theoretical point of view, a radically different and innovative approach is chosen: the graphical framework is used as the central (...) perspective. The major shortcomings of the popular stakeholder framework are systematically confronted with the graphical scheme to illustrate their visual impact. The graphical illustrations of the imperfections help explain the sometimes-oversimplified generalisation inherent to every graphical model. They also make some interrelationships easier to understand. The analysis demonstrates that, with the tacit but implicit acceptance of simplification of the discussed explanatory elements, Freeman's framework remains a rather good approximation of reality. Only a few minor changes to the stakeholder model are consequently proposed. (shrink)

How do we explain organized complexity in human affairs? The most common model explain s human organization as the outcome of rational design; order in human affairs arises from the intentions, plans, and orders of those in charge. For organizational complexity on vast scales, this model is insufficient, misleading, and potentially disastrous. An alternative model, based upon self-organization within complex systems, is developed and applied to the tobacco industry.Leaked documents and public testimony point to widespread distortion of information within the (...) tobacco industry. The model developed herein describes such behaviors as emergent outcomes, not reducible to or sufficiently explained by individual fraud and deliberate deceit. Critics of the tobacco industry often fail to appreciate the role of self-organization in complex systems. They presume rational design. Consequently, they imply more intentional deceit, deliberate planning, and conspiracy than needed to explain the distortions that actually occurred. (shrink)