Table of Contents

Handbook on Responsible Leadership and Governance in Global Business

Handbook on Responsible Leadership and Governance in Global Business

Elgar original reference

Edited by Jonathan P. Doh and Stephen A. Stumpf

Ethics, social responsibility, leadership, governance. These terms are heard in the classroom, in the boardroom, and viewed on the front page of newspapers and magazines. Yet serious attention to the relationships among these concepts is lacking. Although commitments to leadership, ethics, and social responsibility are evident, individuals and companies are falling short in combining these duties into policies and cultures that guide behavior and decisions. The missing element is a broad-based and integrated approach to responsible leadership and governance. This volume provides the leading thinking on these issues and includes a discussion of emerging areas that require future attention.

Chapter 10: Corporate Responsibility, Accountability and Stakeholder Relationships: Will Voluntary Action Suffice?

Sandra Waddock

Subjects: business and management, business leadership, corporate social responsibility, international business


10 Corporate responsibility, accountability and stakeholder relationships: will voluntary action suffice? Sandra Waddock Introduction Stakeholder theory has advanced significantly in the years since Ed Freeman popularized the term in his book Strategic Management: A Stakeholder Approach (Freeman, 1984). From an almost fully corporate centric ‘spoke and wheel’ model of stakeholder ‘management,’ stakeholder theory has moved toward understanding that stakeholder relationships are at the heart of stakeholder theory (Evan and Freeman, 1988; Freeman and Gilbert, 1988) and ultimately of corporate performance itself (Andriof and Waddock, 2002; Andriof et al., 2003), a reality that progressive companies understand clearly. Indeed recent work on networks suggests that organizations and individuals can be stakeholders to an issue, forming networks for local and global action (Waddell, 2003). Companies, in the emerging stakeholder view (Post et al., 2002a), are recognized as inextricably embedded in a web of relationships with stakeholders, some constructive, some destructive (Mitchell et al., 1997). All of these relations combine to constitute the context in which the company operates, not to mention the foundation of the company itself (Waddock, 2002a; Andriof and Waddock, 2002). As testimony to the progress of stakeholder thinking, the term ‘stakeholder’ and its economic analog ‘stakeholder capitalism’ have entered popular parlance. Contrasted to the theoretical mainstream terminology of stakeholder management (for example, Post et al., 2002a, 2002b; Johnson-Cramer et al., 2003), the concept of stakeholder relationships underscores the mutuality, the give and take, and the element of power sharing that is explicit in the terms ‘stakeholder engagement’...

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