A Public Values Perspective
Edited by Peter Leisink, Paul Boselie, Maarten van Bottenburg and Dian Marie Hosking
Chapter 14: The contribution of HRM to fairness, social legitimacy and public value: human resource governance and risk management in seven leading multinational companies
One important aspect of human resource management (HRM) is ‘controlling’ employee behaviour in organizations to ensure fairness for employees, legitimacy of the organization amongst stakeholders and added public value. It is when organizational crises or corporate scandals occur that we realize just how important HRM is and the multiple roles it might have in corporate governance. In this chapter we make a strong plea for the relevance of HRM and the HR function inside and outside the organization with regard to building, maintaining and restoring equity, ethical standards, social legitimacy and public values. Corporate scandals and the 2008 global financial crisis have increased an emphasis on compliance inside organizations to avoid employee misbehaviour. We therefore need to understand more about how employee behaviour inside organizations is controlled. This chapter presents a human resource (HR) governance and risk management model. The framework focuses on safeguarding an economically and socially legitimate organization that potentially creates long-term viability for the stakeholders involved. The approach goes beyond a traditional economic rationalist HRM approach, taking into account governance notions with regard to moral and ethical standards of employees and managers alike, and subsequent implications for fairness, social legitimacy and for society at large.
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