Climate cooperation, unemotional companies and what stakeholder really means
Stakeholder: contesting over definitions
Mitchell et al published a seminal paper on stakeholder theory in 1997. Their research was inspired by the glut of definitions of the term “stakeholder” at the time – there were 38 in published journals. When Friedman and Miles looked again at the issue in 2006, the list of definitions had grown to 55. Come 2011 and a total of 435 different definitions appeared in 493 academic articles.
Here, the author asks frankly whether attempting a definition is a losing battle. Does an all-encompassing meta-definition of “stakeholder” exist, or is it what renowned philosopher WB Gallie has described as a “contested concept”?
Miles takes Gallie’s criteria for the said concept and applies it to “stakeholder”. Gallie’s description fits “perfectly”, he finds. His conclusion thus frees up scholars to quit from internal disputes about whose definition should triumph. Instead, stakeholder theorists should accept the term’s incurable “contestedness” and get on with identifying its “central core”. That done, they can begin the delayed process of developing better examples of the stakeholder concept for specific circumstances.
Miles, S (July 2012), “Stakeholder: Essentially Contested or Just Confused?”, Journal of Business Ethics, 108: 285–298 DOI 10.1007/s10551-011-1090-8.
Stretched genes
Chief executives like to make out that sustainability is ingrained within the genetic code of their companies. It’s not. Not only is the “in our DNA” comment a tired cliché, but it is epistemological nonsense. Companies are not humans. They are not “hard wired” for anything.
Of course, it has become popular to anthropomorphise companies. Think “global citizen” or “local neighbour”. But although modern businesses may be made up of people, that doesn’t make the collective into a human being. Corporations are institutions, devoid of emotion, conscience and, yes, DNA.
The point is important for two main reasons. It means company culture is learned, not genetically inherited. Those directing that learning are managers, armed not with X and Y chromosomes, but with policies and processes. The effectiveness of these management tools is the point on which corporate culture succeeds or fails.
Reason two: as institutions comprising individuals, companies will only become “sustainable” when its constituent members endorse and enact management directives to be so.
The beauty of this practically focused paper from MIT is that it strips sustainability of emotive hubris and sees it for what it is: a creation of management processes. It’s really very simple: the process starts with the instructors (senior management) and is realised by the learners (employees). The instruction phase, neatly referred to as “framing”, relies on internal leadership and external engagement. Stage two is “codification”; namely the metrics, performance incentives and other mechanisms for engaging employees.
Such mechanisms must be company-wide, the authors point out, because “sustainability objectives often involve trade-offs”. Only by adopting a portfolio perspective to achieve the desired balance among actions and outcomes. Change management is a continual process, they also note. It requires “change capabilities” and employee trust if a culture of sustainability is to emerge. So, nothing to do with genes whatsoever.
Eccles, R et al (June 2012), “The Role of Culture in Sustainability”, MIT Sloan Management Review.
Collective responsibility
If the world is to combat climate change, or feed nine billion-odd people by 2050, or protect the planet’s water resources, it will require us all to work together. Individual action is welcome, though ultimately not sufficient. Yet, our frameworks for responsibility are cemented within an individualised moral logic. Sure, companies are beginning to talk in terms of participative solutions. “We cannot do it on our own” is becoming a refreshingly honest corporate refrain. Yet concepts of collective responsibility have yet to take shape.
This timely paper spells out the pillars of which a new form of corporate responsibility for a “collective age” should be established. Pillar one is to accept the moral validity of co-joint, rather than individual, responsibility. This is an insightful point. If global problems can only be solved by “institutional agents” working together, then the obligation not to work alone becomes a moral imperative.
Pillar two argues in favour of the importance of active engagement. In a collaborative age, neutrality and passivity are both sins of “omission”. Thirdly, such responsibility is cast as positive, not negative. Companies’ roles are not just to avoid doing harm in their own remit (“a restrictive conception of moral responsibility”), but also to help resolve structural problems outside their immediate sphere of impact too.
The final two pillars conceptualise collective responsibility as a political responsibility and also a human rights responsibility. Political, because injustices result from multiple influences and they therefore require large-scale, structural (ie political in the sense of public communicative engagement) responses. And human rights, because responsibility must be grounded on a global “common good” (of which human rights provides the closest definition).
A thought-provoking paper that obliges us to find ways to reframe the link between corporate responsibility and the “global processes running loose in this post-certain, post-familiar era”.
Wettstein, F (June 2012), “Corporate Responsibility in the Collective Age: Toward a Conception of Collaborative Responsibility”, Business and Society Review 117 (2):155–184.
Campus news
ConocoPhillips has donated an undisclosed sum to finance the Change Agents in Residence programme at Bainbridge Graduate Institute.
Harvard Business School is to run a four-day executive programme on aligning corporate responsibility with business strategy running October 17-20 2012.