Abstract
Within the context of the pharmaceutical industry, there are numerous controversial issues that have still not received satisfactory answers. In this era of neo-liberal capitalism, ‘responsibilizing’ every stakeholder announces the freedom of the MNCs from regulations and productive stakeholder engagement for enacting sincere corporate social responsibility (CSR) practices. More prominently, as the current level of global health inequalities demonstrates, the twenty-first century stakeholders of the firm are for the most part on their own, although this remains an implicit design in CSR discourses. This reasoning stems from the fact that unlike the proximate and influential stakeholders, these distal and fragile stakeholders remain faceless, invisible and nameless, given their lower socio-economic and political status. Pharmaceutical MNC–stakeholder controversies are not new, but the legitimating tactics of the firm obscure the material needs of stakeholders—especially those of the marginalized and distal stakeholders in emerging economies. The managerial and strategic recipes for stakeholder engagement are manifold, and yet a lot remains to be understood about who engages whom in responsibly creating the maximum social value (health benefits). This is the research question this study seeks to answer. Employing an inductive approach, I use ‘Big Pharma’ as a case that bases arguments on extant literature as ‘authorities of prima facie evidence’ to outline the industry-specific questions whilst questioning the existing answers.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
References
Abraham, John. 2002. The pharmaceutical industry as a political player. The Lancet 360: 1498–1502.
Ahen, Frederick. 2015. Strategic corporate responsibility orientation for sustainable global health governance: Pharmaceutical value co-protection in transitioning economies. Doctoral thesis. Turku, Finland: University of Turku.
Angell, Marcia. 2004. Excess in the pharmaceutical industry. Canadian Medical Association Journal 171: 1451–1453.
Autto, Hannu. 2014. Collective action in commons: Its diverse ends and consequences. Doctoral thesis. Turku, Finland: University of Turku.
Balasegaram, Manica. 2014. Medicine is just for those who can afford it: Why don't pharmaceutical companies develop drugs for the poor? AlJazeera.com, 14 Mar 2014. http://www.aljazeera.com/indepth/opinion/2014/03/medicine-just-those-who-can-aff-201431181911299288.html. Accessed 16 May 2014.
Banerjee, Subhabrata B. 2007. Corporate social responsibility: The good, the bad and the ugly. Cheltenham: Edward Elgar Publishing.
———. 2011. Voices of the Governed: Towards a theory of the translocal. Organization 18 (3): 323–344. doi:10.1177/1350508411398729.
———. 2014. A critical perspective on corporate social responsibility: Towards a global governance framework. Critical Perspectives on International Business 10: 84–95.
Barnes, Kirsty. 2007. New counterfeit report highlights worrying trends. Outsourcing-Pharma. com, 7 Nov 2007. http://www.outsourcing-pharma.com/Contract-Manufacturing/New-counterfeit-report-highlights-worrying-trends. Accessed 12 Apr 2009.
Bates, Robert H., Avner Greif, Margaret Levi, Jean-Laurent Rosenthal, and Barry R. Weingast. 1998. Analytic narratives. Princeton\NJ: Princeton University Press.
———. 2000. The Analytical Narrative Project. American Political Science Review 94 (3): 696–702.
BBC. 2013. GlaxoSmithKline launches Africa charity partnership. BBC News, 10 May 2013. http://www.bbc.co.uk/news/business-22476556. Accessed 11 May 2013.
Bitektine, Alex. 2011. Toward a theory of social judgments of organizations: The case of legitimacy, reputation, and status. Academy of Management Review 36: 151–179.
Boltanski, Luc, and Eve Chiapello. 2006. The new spirit of capitalism. London: Verso.
Bougrine, Hassan. 2006. Oil: Profits of the chain keepers. International Journal of Political Economy 35: 35–53.
Bowen, Howard R. 1953. Social responsibilities of the businessman. New York: Harper & Row.
Bowman, Cliff, and Veronique Ambrosini. 2000. Value creation versus value capture: Towards a coherent definition of value in strategy. British Journal of Management 11: 1–15.
Braithwaite, John, and Peter Drahos. 2000. Global business regulation. Cambridge: Cambridge University Press.
Bruche, Gert. 2011. Emerging challengers in knowledge-based industries? The case of Indian pharmaceutical multinationals, Columbia FDI Perspectives. New York: Vale Columbia Center on Sustainable International Investment.
Buabeng, Kwame O. 2010. The role of the pharmaceutical sector in malaria control in Ghana. Kuopio: University of Eastern Finland.
Buller, Paul F., and Glenn M. McEvoy. 2000. Creating and sustaining ethical capability in the multi-national corporation. Journal of World Business 34: 326–343.
Campbell, John L. 2006. Institutional analysis and the paradox of corporate social responsibility. American Behavioral Scientist 49: 925–938.
———. 2007. Why would corporations behave in socially responsible ways? An institutional theory of corporate social responsibility. Academy of Management Review 32: 946–967.
Carroll, Archie B. 1979. A three-dimensional conceptual model of corporate performance. Academy of Management Review 4: 497–505.
———. 1991. The pyramid of corporate social responsibility Toward the moral management of organizational stakeholders. Business Horizons 34: 39–48.
Castellucci, Fabrizio, and Gokhan Ertug. 2010. What’s in it for them? Advantages of higher-status partners in exchange relationships. Academy of Management Journal 53: 149–166.
Clarkson, Max B.E. 1995. A stakeholder framework for analyzing and evaluating corporate social performance. Academy of Management Review 20: 92–117.
Class, James N. 2012. Emerging markets and differential pricing policies: A question of global health? Journal of Commercial Biotechnology 18: 40–43.
Coase, Ronald H. 1988. The firm, the market, and the law. Chicago: University of Chicago Press.
Countess of Frederiksborg, Alexandra, and Timothy L. Fort. 2014. The paradox of pharmaceutical CSR: The sincerity nexus. Business Horizons 57: 151–160.
Davis, Keith. 1960. Can business afford to ignore social responsibilities? California Management Review 2: 70–76.
Derry, R. 2010. Reclaiming marginalized stakeholders. Journal of Business Ethics 111: 253–264.
De Vogli, Roberto, Anne Kouvonen, and David Gimeno. 2014. The influence of market deregulation on fast food consumption and body mass index: A cross-national time series analysis. Bulletin of the World Health Organization 92: 99–107A.
DiMasi, Joseph A., Ronald W. Hansen, Henry G. Grabowski, and Louis Lasagna. 1991. Cost of innovation in the pharmaceutical industry. Journal of Health Economics 10: 107–142.
Donaldson, Thomas, and Lee E. Preston. 1995. The stakeholder theory of the corporation: Concepts, evidence, and implications. Academy of Management Review 20: 65–91.
Durepos, Gabrielle, Ajnesh Prasad, and Cristian E. Villanueva. 2016. How might we study international business to account for marginalized subjects?: Turning to practice and situating knowledges. Critical Perspectives on International Business 12 (3): 306–314.
Elms, Heather, Shawn Berman, and Andrew C. Wicks. 2002. Ethics and incentives: An evaluation and development of stakeholder theory in the health care industry. Business Ethics Quarterly 12: 413–432.
Emanuel, Ezekiel J., David Wendler, and Christine Grady. 2000. What makes clinical research ethical? Journal of the American Medical Association 283: 2701–2711.
Emanuel, Ezekiel J., David Wendler, Jack Killen, and Christine Grady. 2004. What makes clinical research in developing countries ethical? The benchmarks of ethical research. Journal of Infectious Diseases 189: 930–937.
Fleming, Peter, John Roberts, and Christina Garsten. 2013. In search of corporate social responsibility: Introduction to special issue. Organization 20: 337–348.
Frederick, William C. 1960. The growing concern over business responsibility. California Management Review 2: 54–61.
———. 1998. Moving to CSR4: What to pack for the trip. Business and Society 37: 40–59.
Freeman, R. Edward. 1984. Strategic management: A stakeholder approach. Boston, MA: Pitman.
———. 2004. Ethical leadership and creating value for stakeholders. In Business ethics: New challenges for business schools and corporate leaders, ed. Robert A. Peterson and O.C. Ferrell, 82–97. Armonk\New York: M.E. Sharpe.
Freeman, R. Edward, and S. Ramakrishna Velamuri. 2006. A new approach to CSR: Company stakeholder responsibility. In Corporate social responsibility: Reconciling aspiration with application, ed. Kakabadse Andrew and Morsing Mette, 9–23. New York: Palgrave MacMillan.
Friedman, Milton. 1970. The social responsibility of business is to increase its profits, The New York Times Magazine. New York: The New York Times Company.
Frooman, Jeff. 1999. Stakeholder influence strategies. Academy of Management Review 24: 191–205.
Gallagher, John A., and Jerry Goodstein. 2002. Fulfilling institutional responsibilities in health care. Business Ethics Quarterly 12: 433–450.
Gambardella, Alfonso. 1995. Science and innovation: The US pharmaceutical industry during the 1980s. Cambridge: Cambridge University Press.
Gehrke, Mirjam. 2012. Pharmaceutical industry neglects developing countries. DW.DE, 26 Oct 2012. http://www.dw.de/pharmaceutical-industry-neglects-developing-countries/a-16331939. Accessed 20 May 2014.
Ghauri, Pervez N., and Peter J. Buckley. 2002. Globalization and the end of competition: A critical review of rent-seeking multinationals. In Critical perspectives on internationalization, ed. Virpi Havila, Mats Forsgren, and Håkan Håkansson, 7–28. Oxford: Pergamon Press.
Goldacre, Ben. 2012. Bad pharma: How drug companies mislead doctors and harm patients. London: Fourth Estate.
Gond, Jean-Pascal, Nahee Kang, and Jeremy Moon. 2011. The government of self-regulation: On the comparative dynamics of corporate social responsibility. Economy and Society 40: 640–671.
Hall, Peter A., and David W. Soskice. 2001. Varieties of capitalism: the institutional foundations of comparative advantage. New York: Oxford University Press.
Hamm, Bernd. 2010. The study of futures, and the analysis of power. Futures 42: 1007–1018.
Hanlon, Gerard, and Peter Fleming. 2009. Updating the critical perspective on corporate social responsibility. Sociology Compass 3: 937–948.
Hansén, Sten-Olof. 1982. Studies in internationalisation of the pharmaceuticals industry – A taxonomic approach. Doctoral thesis. Turku, Finland: Åbo Akademi University.
Harris, Jared D., and R. Edward Freeman. 2008. The impossibility of the separation thesis: A response to Joakim Sandberg. Business Ethics Quarterly 18: 541–548.
Hermans, Raine, Martti Kulvik, and Pekka Ylä-Anttila. 2005. International mega-trends and growth prospects of the Finnish biotechnology industry: Recent economic research and policy implications. Journal of Commercial Biotechnology 11: 134–145.
Hill, Peter S. 2011. Understanding global health governance as a complex adaptive system. Global Public Health 6: 593–605.
Huberman, Bernardo A., Christoph H. Loch, and Ayse Önçüler. 2004. Status as a valued resource. Social Psychology Quarterly 67: 103–114.
Hymer, Stephen H. 1960/1976. The international operations of national firms: A study of direct foreign investment. Cambridge, MA: MIT Press.
Ietto-Gillies, Grazia. 2002. Hymer, the nation-state and the determinants of multinational corporations’ activities. Contributions to Political Economy 21: 43–54.
IMS-Health. 2012. Africa: A ripe opportunity. Understanding the pharmaceutical market opportunity and developing sustainable business models in Africa. http://www.imshealth.com/ims/Global/Content/Insights/Featured%20Topics/Emerging%20Markets/IMS_Africa_Opportunity_Whitepaper.pdf. Accessed 23 Apr 2013.
Jain, Sachin H., Rebecca Weintraub, Joseph Rhatigan, Michael E. Porter, and Jim Y. Kim. 2008. Delivering global health. Student British Medical Journal 16: 227.
Jarvis, Lisa M. 2009. Filling drug gaps. Chemical and Engineering News 87 (3): 38–40.
Jensen, Michael C., and William H. Meckling. 1976. Theory of the firm: managerial behavior, agency costs and ownership structure. Journal of Financial Economics 3: 305–360.
Katsikas, Dimitrios. 2011. Technical requirements for the registration of pharmaceutical products. In Handbook of transnational governance: Institutions & Innovations, ed. Thomas Hale and David Held, 88–94. Cambridge/Maiden: Polity.
Kelesidis, Theodore, Iosif Kelesidis, Petros I. Rafailidis, and Matthew E. Falagas. 2007. Counterfeit or substandard antimicrobial drugs: A review of the scientific evidence. Journal of Antimicrobial Chemotherapy 60: 214–236.
Kim, Jim Y., Joseph Rhatigan, Sachin H. Jain, Rebecca Weintraub, and Michael E. Porter. 2010. From a declaration of values to the creation of value in global health: A report from Harvard University’s Global Health Delivery Project. Global Public Health 5: 181–188.
Kozinets, Robert V., and Jay M. Handelman. 2004. Adversaries of consumption: Consumer movements, activism, and ideology. Journal of Consumer Research 31: 691–704.
Krech, Rüdiger. 2012. Working on the social determinants of health is central to public health. Journal of Public Health Policy 33: 279–284.
Lartey, Paul A., and Alexandra, Graham. 2007. Health is wealth: Challenges of financing a state of the art pharmaceutical project in Africa. Corporate Africa Health Conference 2007 (Accra, Ghana), 15–16 April 2007. http://www.lagraychem.com/docs/knowl_article_gbc1.pdf. Accessed 23 June 2009.
Macdonald, Gareth. 2011a. UNCTAD to discuss fostering drug manufacturing in Africa. in-Pharma Technologist.com, 21 Mar 2011. http://www.in-pharmatechnologist.com/Regulatory-Safety/UNCTAD-to-discuss-fostering-drug-manufacturing-in-Africa. Accessed 30 May 2012.
———. 2011b. UNIDO and AUC says big pharma can support drugmaking in Africa through partnering. in-Pharma Technologist.com, 12 Oct 2011. http://www.in-pharmatechnologist.com/Regulatory-Safety/UNIDO-and-AUC-says-Big-Pharma-can-support-drugmaking-in-Africa-through-partnering. Accessed 30 May 2012.
Mackey, Tim K., and Bryan A. Liang. 2011. The global counterfeit drug trade: patient safety and public health risks. Journal of Pharmaceutical Sciences 100: 4571–4579.
———. 2012. Globalization, evolution and emergence of direct-to-consumer advertising: Are emerging markets the next pharmaceutical marketing frontier. Journal of Commercial Biotechnology 18: 58–64.
———. 2013. Pharmaceutical digital marketing and governance: Illicit actors and challenges to global patient safety and public health. Globalization and Health 9: 45.
Maitland, Ian. 2002. Priceless goods: How should life-saving drugs be priced? Business Ethics Quarterly: 451–480.
Mantere, Saku, Kalle Pajunen, and Juha-Antti Lamberg. 2009. Vices and virtues of corporate political activity: The challenge of international business. Business and Society 48: 105–132.
May, Tim. 1997. Social research: Issues, methods and research. 2nd ed. Berkshire: McGraw-Hill Education.
McVea, John F., and R. Edward Freeman. 2005. A names-and-faces approach to stakeholder management: How focusing on stakeholders as individuals can bring ethics and entrepreneurial strategy together. Journal of Management Inquiry 14: 57–69.
Mitchell, Ronald K., Bradley R. Agle, and Donna J. Wood. 1997. Toward a theory of stakeholder identification and salience: Defining the principle of who and what really counts. Academy of Management Review 22: 853–886.
MSF, Médecins Sans Frontières. 2001. Fatal imbalance: The crisis in research and development for drugs for neglected diseases. Geneva, Access to Essential Medicines Campaign and Drugs for Neglected Diseases Working Group; Médecins Sans Frontières.
Mullin, Rick. 2009. Stateside surge in pharma chemicals, Chemical and Engineering News 87 (39):38–41.
Myslinski Tipton, Martha, Sundar G. Bharadwaj, and Diana C. Robertson. 2009. Regulatory exposure of deceptive marketing and its impact on firm value. Journal of Marketing 73: 227–243.
Nussbaum, Alexander Sascha K. 2009. Ethical corporate social responsibility (CSR) and the pharmaceutical industry: A happy couple? Journal of Medical Marketing: Device, Diagnostic and Pharmaceutical Marketing 9: 67–76.
Nwaka, Solomon, and Robert G. Ridley. 2003. Virtual drug discovery and development for neglected diseases through public–private partnerships. Nature Reviews Drug Discovery 2: 919–928.
Osborne, Stephen P., ed. 2000. Public-private partnerships: Theory and practice in international perspective. London: Routledge.
Osterath, Brigitte. 2014. The drug divide: Concerns grow in the US over generics produced in India. DW.DE, 23 Mar 2014. http://www.dw.de/the-drug-divide-concerns-grow-in-the-us-over-generics-produced-in-india/a-17507784. Accessed 29 May 2014.
Osuji, Onyeka K., and Okechukwu T. Umahi. 2012. Pharmaceutical companies and access to medicines–social integration and ethical CSR resolution of a global public choice problem. Journal of Global Ethics 8: 139–167.
Palazzo, Guido, and Andreas Georg Scherer. 2006. Corporate legitimacy as deliberation: A communicative framework. Journal of Business Ethics 66: 71–88.
Park, Stephanie S., and Mitchell H. Grayson. 2008. Clinical research: Protection of the “vulnerable”? Journal of Allergy and Clinical Immunology 121: 1103–1107.
Payne, Adrian, David Ballantyne, and Martin Christopher. 2005. A stakeholder approach to relationship marketing strategy: The development and use of the “six markets” model. European Journal of Marketing 39: 855–871.
Pisano, Gary P. 2006. The science business: The promise, the reality, and the future of biotech. Boston: Harvard Business Press.
Porter, Michael E., and Elizabeth O. Teisberg. 2006. Redefining health care: Creating value-based competition on results. Boston: Harvard Business School Publishing.
Post, James E., Lee E. Preston, and Sybille Sachs. 2002. Managing the extended enterprise: The new stakeholder view. California Management Review 45: 6–28.
Prasad, Ajnesh, and Gabrielle Durepos. 2016. From margin to center: Listening to silenced subjectivities in international business. Critical Perspectives on International Business 12 (3): 218–221.
Public Citizen. 2001. Rx R&D myths: The case against the drug industry’s R&D “scare card”. Public Citizen’s Congress Watch July 2001. http://www.citizen.org/documents/ACFDC.PDF. Accessed 11 Jun 2014.
Radin, Margaret. 1997. Contested commodities. Cambridge: Harvard University Press.
Rodrigues, Suzana. 2013. Understanding the environments of emerging markets: the social costs of institutional voids. http://www.erim.eur.nl/news/detail/3160-farewell-address-understanding-the-environments-of-emerging-markets/#sthash.uDL2vctV.dpuf. Accessed 12 Oct 2013.
Ruggie, John G. 1982. International regimes, transactions, and change: Embedded liberalism in the postwar economic order. International Organization 36: 379–415.
Santoro, Michael A., and Thomas M. Gorrie. 2005. Ethics and the pharmaceutical industry. New York: Cambridge University Press.
Sassen, Saskia. 1996. Losing control? Sovereignty in an age of globalization. New York: Columbia University Press.
Scherer, Andreas G., and Guido Palazzo. 2007. Toward a political conception of corporate responsibility: Business and society seen from a Habermasian perspective. Academy of Management Review 32: 1096–1120.
Schipper, Irene, and Francis Weyzig. 2008. Ethics for drug testing in low and middle income countries: Considerations for European market authorisation. Amsterdam: Stichting Onderzoek Multinationale Ondernemingen (SOMO).
Schoonveld, Ed. 2015. The price of global health: drug pricing strategies to balance patient access and the funding of innovation. Second ed. Burlington: Gower Publishing, Ltd..
Schrecker, Ted. 2012. Multiple crises and global health: New and necessary frontiers of health politics. Global Public Health 7: 557–573.
Senthilingam, Meera. 2015. How paradise became the fattest place in the world. CNN.com, 1 May 2015. http://edition.cnn.com/2015/05/01/health/pacific-islands-obesity/. Accessed 1 May 2015.
Shah, Anup. 2010. Pharmaceutical corporations and medical research. Global Issues, 2 Oct.. http://www.globalissues.org/article/52/pharmaceutical-corporations-and-medical-research. Accessed 29 Jun 2013.
Shamir, Ronen. 2004. The de-radicalization of corporate social responsibility. Critical Sociology 30: 669–689.
———. 2008. The age of responsibilization: on market-embedded morality. Economy and Society 37: 1–19.
Shepherd, Marv. 2010. Beef up international cooperation on counterfeits. Nature Medicine 16: 366.
Simons, Bright. 2013. mPedigree: An African blueprint for consumer empowerment. This Is Africa, 15 Jan 2013. http://www.thisisafricaonline.com/Perspectives/mPedigree-An-African-blueprint-for-consumer-empowerment. Accessed 14 Dec 2013.
Sklair, Leslie. 2002. Globalization: Capitalism and its alternatives. 3rd ed. Oxford: Blackwell Publishing.
Smith, Alan D. 2008. Corporate social responsibility practices in the pharmaceutical industry. Business Strategy Series 9: 306–315.
Smith, Brian D. 2013. Fitness first: How Pharma can get in shape for the future. PMLiVE.com . http://www.pmlive.com/pharma_news/fitness_first_how_pharma_can_get_in_shape_for_the_future_465508. Accessed 10 May 2013.
Stiglitz, Joseph E. 2006. Making globalization work. New York: W. W. Norton and Company.
Stiglitz, Joseph E., and Arjun Jayadev. 2010. Medicine for tomorrow: Some alternative proposals to promote socially beneficial research and development in pharmaceuticals. Journal of Generic Medicines 7: 217–226.
Strange, Susan. 1996. The retreat of the state: The diffusion of power in the world economy. Cambridge: Cambridge University Press.
Suchman, Mark C. 1995. Managing legitimacy: Strategic and institutional approaches. Academy of Management Review 20: 571–610.
Thye, Shane R. 2000. A status value theory of power in exchange relations. American Sociological Review 65: 407–432.
Underwood Stephens, Carroll, and Anthony T. Cobb. 1999. A Habermasian approach to justice in organizational change: Synthesizing the technical and philosophical perspectives. Journal of Organizational Change Management 12: 21–34.
Whitley, Richard. 2007. Business systems and organizational capabilities: the institutional structuring of competitive competences. Oxford: Oxford University Press.
Winston, Morton. 2002. NGO strategies for promoting corporate social responsibility. Ethics and International Affairs 16: 71–87.
Vogel, David. 2005. The market for virtue: The potential and limits of corporate social responsibility. Washington, DC: Brookings Institution Press.
Yang, Alice, Paul E. Farmer, and Anita M. McGahan. 2010. ‘Sustainability’ in global health. Global Public Health 5: 129–135.
Yin, Robert K. 2009. Case study research: Design and methods. 4th ed. Thousand Oaks, CA: SAGE Publications Inc..
Zadek, Simon. 2001. The civil corporation: The new economy of corporate citizenship. London: Earthscan.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2017 Springer International Publishing AG
About this chapter
Cite this chapter
Ahen, F. (2017). Responsibilization and MNC–Stakeholder Engagement: Who Engages Whom in the Pharmaceutical Industry?. In: Freeman, R., Kujala, J., Sachs, S. (eds) Stakeholder Engagement: Clinical Research Cases. Issues in Business Ethics, vol 46. Springer, Cham. https://doi.org/10.1007/978-3-319-62785-4_5
Download citation
DOI: https://doi.org/10.1007/978-3-319-62785-4_5
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-319-62784-7
Online ISBN: 978-3-319-62785-4
eBook Packages: Religion and PhilosophyPhilosophy and Religion (R0)