Advertisement

The Firm as a Nexus of Stakeholders

  • Josef Wieland
Chapter
Part of the Ethical Economy book series (SEEP, volume 48)

Abstract

This chapter focuses on the economic concept of stakeholder management and defines the firm as a form of governance of stakeholder relationship. Stakeholders are defined as the owners or possessors of resources or competencies, which they contribute to a team. In doing so, Stakeholders consent to concluding a formal or informal contractual relationship. The approach suggests to define the governance of stakeholder relationships as a two-stage process, at first of identifying and then of prioritizing the relevant stakeholders of a team, both in regard to its constitution and to the implementation of its specific transactions. The nature of the firm can then be determined as a contractual nexus of stakeholder resources and stakeholder interests, whose function lies in the governance, namely the leadership, management and monitoring of the resource owners, with the aim of economic value creation and the distribution of a cooperation rent. The concept of a governance of stakeholder relationships by means of identification and prioritization developed here aims at creating a unified basis for the management of stakeholder relationships from a governance-economic perspective. Regardless of the form of contract that makes an individual or a group of actors an actual stakeholder, the selection and decision process must be organized in accordance with unified indicators. It is argued that the failure to do so has to be identified as a weakness of the current discussions in democracy theory and business ethics on stakeholder management, which are exclusively tailored to suit the special case of the NGOs or other actors in civil society. Investors, employers or suppliers as possessors of resources and representatives of interests however are simply ignored. This, so the argument runs, is possible from the viewpoint of political or ethical theories but not from the perspective of a general theory of stakeholder management.

Keywords

Business Ethic Stakeholder Theory Stakeholder Management Contractual Relationship Stakeholder Relationship 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

References

  1. Arena, R., and C. Longhi (eds.). 1998. Markets and organization. Berlin: Springer.Google Scholar
  2. Barney, J. 1991. Firm resources and sustained competitive advantage. Journal of Management 17(1): 99–120.CrossRefGoogle Scholar
  3. Bigley, G.A., W. Felps, and T.M. Jones. 2007. Ethical theory and stakeholder-related decisions: The role of stakeholder culture. Academy of Management Review 32(1): 137–155.CrossRefGoogle Scholar
  4. Blair, M.M. 1998. For whom should corporations be run? An economic rationale for stakeholder management. Long Range Planning 31(2): 195–200.CrossRefGoogle Scholar
  5. Boatright, J.R. 2002. Contractors as stakeholders: Reconciling stakeholder theory with the nexus-of-contracts firm. Journal of Banking and Finance 26(9): 1837–1852.CrossRefGoogle Scholar
  6. Carroll, A.B., and A.K. Buchholtz. 2008. Business and society. Ethics and stakeholder management, 7th ed. Mason: South-Western Cengage Learning.Google Scholar
  7. Carroll, G., and D.J. Teece. 1999. Firms, markets and hierarchies: The transaction cost economics perspective. New York: Oxford University Press.Google Scholar
  8. Donaldson, T., and T.W. Dunfee. 1994. Toward a unified conception of business ethics: Integrative social contracts theory. Academy of Management Review 19(2): 252–284.Google Scholar
  9. Donaldson, T., and T.W. Dunfee. 1995a. Social contracts and business ethics. Business Ethics Quarterly 5(2): 173–186.CrossRefGoogle Scholar
  10. Donaldson, T., and T.W. Dunfee. 1995b. Integrative social contracts theory. Economics and Philosophy 11(1): 85–112.CrossRefGoogle Scholar
  11. Donaldson, T., and T.W. Dunfee. 1999. Ties that bind: A social contracts approach to business ethics. Cambridge, MA: Harvard Business School Press.Google Scholar
  12. Freeman, R.E. 1984. Strategic management: A stakeholder approach. Boston: Pitman.Google Scholar
  13. Freeman, R.E. 2004. The stakeholder approach revisited. Zeitschrift für Wirtschafts- und Unternehmensethik 5(3): 228–241.Google Scholar
  14. Freeman, R.E., and S.R. Velamuri. (2005). A new approach to CSR: Company stakeholder responsibility. Darden Virginia School, University of Virginia (unpublished paper).Google Scholar
  15. Freeman, R.E., A. Wicks, A. Parmar, and J. McVea. 2004. Stakeholder theory: The state of the art and future perspectives. Notizie di Politeia. Rivista di Etica e scelte pubbliche 20(74): 9–22.Google Scholar
  16. Freeman, R.E., A. Wicks, and B. Parmar. 2006. Stakeholder theory as a basis for capitalism. The Darden School, University of Virginia (unpublished paper).Google Scholar
  17. Freeman, R.E., J.S. Harrison, and A.C. Wicks. 2007a. Managing for stakeholders: Survival, reputation, and success. New Haven: Yale University Press.Google Scholar
  18. Freeman, R.E., K.E. Martin, and B.L. Parmar. 2007b. Stakeholder capitalism. Journal of Business Ethics 74(4): 303–314.CrossRefGoogle Scholar
  19. Hill, C.W., and T.M. Jones. 1992. Stakeholder-agency theory. Journal of Management Studies 29(2): 131–154.CrossRefGoogle Scholar
  20. Menard, C. 2005. A new institutional approach to organization. In Handbook of new institutional economics, ed. C. Menard and M.M. Shirley. Dordrecht: Springer.CrossRefGoogle Scholar
  21. Mitchell, R.K., B.R. Agle, and D.J. Wood. 1997. Toward a theory of stakeholder identification and salience: Defining the principle of who and what really counts. The Academy of Management Review 22(4): 853–886.Google Scholar
  22. Osterloh, M., and B.S. Frey. 2005. Corporate governance: Eine Prinzipal-Agenten-Beziehung, Team-Produktion oder ein Soziales Dilemma? Universität Zürich (working paper).Google Scholar
  23. Parent, M.M., and D.L. Deephouse. 2007. A case study of stakeholder identification and prioritization by managers. Journal of Business Ethics 75(1): 1–23.CrossRefGoogle Scholar
  24. Phillips, R. 2003. Stakeholder theory and organizationals ethics. San Francisco: Berret-Koehler.Google Scholar
  25. Podsakoff, P.M., S. MacKenzie, J. Paine, and D. Bachrach. 2000. Organizational citizenship behaviours: A critical review of the theoretical and empirical literature and suggestions for the future research. Journal of Management 26(3): 513–563.CrossRefGoogle Scholar
  26. Quinn, D.P., and T.M. Jones. 1995. An agent morality view of business politics. Academy of Management Review 20(1): 22–42.Google Scholar
  27. Rawls, J. 2001. Justice as fairness: A restatement. Cambridge, MA: Harvard University Press.Google Scholar
  28. Roloff, J. 2002. Stakeholdermanagement – Ein monologisches oder dialogisches Verfahren? Zeitschrift für Wirtschafts- und Unternehmensethik 3(1): 77–95.Google Scholar
  29. Sachs, S., and M. Maurer. 2009. Toward dynamic corporate stakeholder responsibility. Journal of Business Ethics 85(3): 535–544.CrossRefGoogle Scholar
  30. Schein, E.H. 1965. Organizational psychology. Englewood Cliffs: Prentice-Hall.Google Scholar
  31. Scherer, A.G., and G. Palazzo. 2007. Toward a political conception of corporate responsibility: Business and society seen from a Habermasian perspective. Academy of Management Review 32(4): 1096–1120.CrossRefGoogle Scholar
  32. Teece, D.J., G. Pisano, and A. Shuen. 1997. Dynamic capabilities and strategic management. Strategic Management Journal 18(7): 509–533.CrossRefGoogle Scholar
  33. Van Oosterhout, J.H., P. Heugens, and M. Kaptein. 2006. The internal morality of contracting: Advancing in the contractualist endeavor in business ethics. Academy of Management Review 31(3): 521–539.CrossRefGoogle Scholar
  34. Wieland, J. 1996. Ökonomische Organisation, Allokation und Status. Tübingen: J.C.B. Mohr.Google Scholar
  35. Wieland, J. 1997. Die neue Organisationsökonomik. Entwicklung und Probleme der Theoriebildung. In Theorien der Organisation, ed. G. Ortmann, K. Türk, and J. von Sydow, 35–66. Opladen: Westdeutscher Verlag.CrossRefGoogle Scholar
  36. Wieland, J. 1999/2007. Die Ethik der Governance. Marburg: Metropolis.Google Scholar
  37. Wieland, J. 2005. Normativität und Governance: Gesellschaftstheoretische und philosophische Reflexionen der Governanceethik. Marburg: Metropolis.Google Scholar
  38. Wieland, J. 2007. Idealistische, ideale und reale Diskurse: Governanceformen des Diskurses. In Governanceethik und Diskursethik – ein zwangloser Diskurs, ed. J. Wieland, 13–59. Marburg: Metropolis.Google Scholar
  39. Williamson, O.E. 1985. The economic institutions of capitalism. London/New York: The Free Press.Google Scholar
  40. Williamson, O.E. (ed.). 1990. Organization theory: From Chester Barnard to the present and beyond. Oxford: Oxford University Press.Google Scholar
  41. Williamson, O.E. 1996. The mechanism of governance. New York: Oxford University Press.Google Scholar
  42. Williamson, O.E. 2002. The theory of the firm as governance structure: From choice to contract. Journal of Economic Perspective 16(3): 171–195.CrossRefGoogle Scholar
  43. Williamson, O.E. 2005. The economics of governance. Oxford: Oxford University Press.Google Scholar

Copyright information

© Springer International Publishing Switzerland 2014

Authors and Affiliations

  • Josef Wieland
    • 1
  1. 1.Zeppelin UniversityFriedrichshafenGermany

Personalised recommendations