Abstract
There is a growing discourse on stakeholder, sustainability, and responsible governance. Today the stakeholder practice is no longer about the question of whether to engage, but how. Scholars examining stakeholder relationships have increasingly called for a deeper examination of firm-stakeholder relations beyond the general scope of aggregate stakeholder engagement metrics (Kujala, Sachs, Leinonen, Heikkinen, & Laude, 2022). A typical example of the aggregate engagement metric is the stakeholder management performance (SMP) measure that uses the sum or average of scores across stakeholder groups to reach a composite score that represents the extent to which a firm attends to stakeholders’ needs (e.g., Bettinazzi & Zollo, 2022; Flammer & Bansal, 2017). Thus, this thesis starts from an interest in how companies implement strategies to engage with multiple types of stakeholders through a first study. Building on this essay, this thesis is further motivated to investigate the outcomes and antecedents of stakeholder engagement strategies through two other studies.Study 1 is an exploratory study using quantitative data, aiming to present a model of stakeholder configurations, in terms of how firms manage relationships with multiple stakeholders in terms of priority, depth, and breadth. Firstly, I synthesize the literature in the general stakeholder domain into a three-dimensional framework of stakeholder engagement strategy, which is referred to as stakeholder configurations. Then, building upon the integrated version of stakeholder theory that incorporates the descriptive, instrumental, and normative aspects, I distinguish a firm’s approach to stakeholder engagement along the dimensions of priority, depth, and breadth. Using cluster analysis on a sample of 1,921 international firms, I find four dominant configurations of stakeholder strategies: 1) a managing-for-stakeholder strategy, 2) a shareholder-primacy strategy, 3) a customer-centric strategy, and 4) a socially-oriented strategy. Of these four distinct configurations detailing how firms engage with various stakeholders, only one configuration prioritizes shareholders, although this configuration accounts for a notable 50% of the sample. This further establishes the importance of considering nuances in firms’ approaches to stakeholder engagement beyond the composite measurements. This study therefore contributes to the descriptive stakeholder theory. It conceptually and empirically shows that the three dimensions of stakeholder engagement strategies exist and are distinct from each other and that they should be considered together when understanding how firms engage with multiple stakeholders.
Study 2 draws on the interconnections among the three dimensions of stakeholder engagement strategies and aims to examine the relationship between stakeholder engagement strategy and corporate sustainability using a configurational approach. I first construct corporate sustainability (CS) based on the temporal orientations inherent in the concept of sustainability (Slawinski & Bansal, 2015). CS is therefore classified into long-term oriented and short-term oriented CS. Following previous studies, text analysis of sustainability reports is used to count the number of keywords referring to the short-term and long-term (Flammer, Hong, & Minor, 2019; Landrum, 2018). Adopting fuzzy-set qualitative comparative analysis (fsQCA), the results highlight four paths toward long-term oriented CS and three paths toward short-term oriented CS. This study contributes to corporate sustainability and stakeholder literature by integrating the two literature to explain how a firm’s long- and short-term CS time orientation is formed depending on how firms engage with stakeholders in terms of priority, depth, and breadth. The study also sheds light on the instrumental aspect of stakeholder theory as firms may adopt a variety of stakeholder strategies beyond the normative engagement approach proposed by stakeholder theory to fulfill their objectives.
Study 3 further investigates the determinants of a firm’s stakeholder engagement strategy, aiming to understand the reason behind why firms pursue certain strategies. An increasing importance is being attached to the crucial role of corporate governance mechanisms in establishing corporate stakeholder strategies (Aguilera, Aragón-Correa, Marano, & Tashman, 2021; Fatemi, Fooladi, & Tehranian, 2015). I argue that the board of directors, as a core element of corporate governance, has a critical impact on a firm’s stakeholder engagement strategy through its roles of resource provisioning and strategic advising. This study uses a longitudinal sample of 10,808 observations between 2010 and 2019 from 2,037 publicly listed firms across 39 countries. I find piratical support for the prediction. The results confirm that the effect of board diversity on depth is significant and positive and its effect on breadth is positive but not significant. This positive effect may stem from increased secondary stakeholder engagement, as the additional analysis reveals that board diversity has a significantly positive effect on secondary stakeholder engagement. This study also delves into the moderating effects of regulative and cultural-cognitive institutions on the relationship between board diversity and the specific nature of stakeholder engagement strategies adopting the three pillars of institutions framework (Scott, 2001). It provides evidence that the presence of board gender quota regulations while strengthening the positive relationship between board diversity and depth weakens the positive relationship between board diversity and breadth. By contrast, a highly gender-egalitarian culture weakens the positive relationship between board diversity and depth. As a supplementary analysis, the moderating effects of other cultural values as identified in the GLOBE Project are also examined.
| Date of Award | 13 Jul 2025 |
|---|---|
| Original language | English |
| Awarding Institution |
|
| Supervisor | Saileshsingh Gunessee (Supervisor), Youngun Kim (Supervisor) & Peter Hofman (Supervisor) |