Pivoting the Role of Government in the Business and Society Interface: A Stakeholder Perspective
The growing popularization of stakeholder theory among management scholars has offered a useful framework for understanding the multiple and interdependent roles of government and business in an increasingly challenging political and regulatory environment. Despite this trend, attention to the role and responsibility of government to protect citizen rights has been limited. To the two traditional stakeholder theory views of government where the focal organization remains the firm, we propose to add two views by pivoting the government’s place and making it the focal organization. We thus describe governments as serving four roles in the business–government–society nexus (namely, “framework,” “business partner,” “interfering,” and “advocate”). For each role, we analyze typical governmental activities/behaviors, relationships with firms’ stakeholders, as well as the challenges and limits to these roles. We also focus on the central notion of salience amplification, as a means of checks and balances across stakeholders in order to safeguard citizen rights and reveal the greater good.
KeywordsStakeholder theory Government Citizens Salience
Nicolas Dahan would like to sincerely thank his friend and colleague Professor Bernard Leca (Dauphine) for earlier conversations on this article’s topic that framed this contribution.
- Alderman, L. (2013, February 20). Quel brouhaha! A diatribe on unions irks the French. New York Times.Google Scholar
- Boddewyn, J., & Brewer, T. (1994). International business political behavior: New theoretical directions. Academy of Management Review, 19(1), 119–143.Google Scholar
- Cocks, G., Mueller, J., & Ingley, C. (in press). The financial crisis, investor activists and corporate strategy. Journal of Management and Governance.Google Scholar
- Coy, P., Parkin, B., & Martin, A. (2014, March 20). In trade talks, it’s countries vs. companies. Businessweek.Google Scholar
- Donaldson, T., & Dunfee, T. W. (1994). Toward a unified conception of business ethics: Integrative social contracts theory. Academy of Management Review, 19(2), 252–284.Google Scholar
- Donaldson, T., & Preston, L. E. (1995). The stakeholder theory of the corporation: Concepts, evidence, and implications. Academy of Management Review, 20(1), 65–91.Google Scholar
- Drayton, B., & Budinich, V. (2010). A new alliance for global change. Harvard Business Review, 88(9), 56–64.Google Scholar
- Eggers, W. D., & Macmillan, P. (2013). The solution revolution: How business, government, and social enterprises are teaming up to solve society’s toughest problems. Cambridge, MA: Harvard Business Review Press.Google Scholar
- Forero, J. (2005, July 1). Report criticizes labor standards in Central America. New York Times.Google Scholar
- Freeman, R. E. (1984). Strategic management. Boston: Pitman/Ballinger.Google Scholar
- Freeman, R. E. (2008). Ending the so-called “Friedman–Freeman” debate. Business Ethics Quarterly, 18(2), 162–166.Google Scholar
- Friedman, M. (1970, September 13). The social responsibility of business is to increase its profits. New York Times Magazine.Google Scholar
- Haynes, W. (2002). Transportation at the millennium. Review of Policy Research, 19(1), 62–89.Google Scholar
- Hillman, A., Keim, G., & Schuler, D. (2004). Corporate political activity: A review and research agenda. Journal of Management, 30, 837–857.Google Scholar
- Joskow, P., & Schlamensee, R. (1988). Markets for power: An analysis of electrical utility deregulation. Cambridge, MA: MIT Press.Google Scholar
- Khanna, T., Palepu, K. G., & Sinha, J. (2005). Strategies that fit emerging markets. Harvard Business Review, 83(6), 63–76.Google Scholar
- Lehne, R. (1993). Industry and politics: United States in comparative perspective. Englewood Cliffs, NJ: Prentice Hall.Google Scholar
- Lopez, J. A. P., & Santos, J. M. S. (in press). Does corruption have social roots: The role of culture and social capital. Journal of Business Ethics.Google Scholar
- Mahon, J. F. (1993). Shaping issues/manufacturing agents: Corporate political sculpting. In B. M. Mitnick (Ed.), Corporate political agency (pp. 187–212). Thousand Oaks, CA: Sage.Google Scholar
- McGraw, T. (1984b). Business and government: The origins of the adversary relationship. California Management Review, 27(2), 32–52.Google Scholar
- Mitchell, N. J. (1997). The conspicuous corporation: Business, public policy and representative democracy. Ann Arbor, MI: The University of Michigan Press.Google Scholar
- Mitchell, R. K., Agle, B. R., & Wood, D. K. (1997). Toward a theory of stakeholder identification and salience. Academy of Management Review, 22(4), 853–886.Google Scholar
- OECD. (2012). China in focus: Lessons and challenges. Retrieved from http://www.oecd.org/china/50011051.pdf.
- Orr, G. (2011, December 21). Everyone loses in a US vs. China trade war. Retrieved from http://blogs.hbr.org/2011/12/everyone-loses-in-a-us-china-tra/.
- O’Toole, J. (2013, July 1). GAO: U.S. corporations pay average effective tax rate of 12.6 %. CNN Money. Retrieved from http://money.cnn.com/2013/07/01/news/economy/corporate-tax-rate/.
- Porter, M. E., & Rivkin, J. W. (2012). The looming challenge to US competiveness. Harvard Business Review, 90(3), 54–62.Google Scholar
- Rawls, J. (2013). The justification of civil disobedience. In A. Kavanagh & J. Oberdiek (Eds.), Arguing about law (pp. 244–253). New York: Routledge.Google Scholar
- Reich, R. B. (2009). Government in your business. Harvard Business Review, 87(7/8), 94–99.Google Scholar
- Rowley, T. J. (1997). Moving beyond dyadic ties: A network theory of stakeholder influences. Academy of Management Review, 22(4), 887–910.Google Scholar
- Tulpulé, V., Brown, S., Lim, J., Polidano, C., Pant, H., & Fisher, B. S. (1998). An economic assessment of the Kyoto Protocol using the Global Trade and Environment Model. Retrieved from http://www.oecd.org/dev/1922979.pdf.
- Vernon, R. (1976). Multinational enterprises and national governments: Exploration of an uneasy relationship. Columbia Journal of World Business, 9–16.Google Scholar
- Vietor, R. H. K., & Weinzierl, M. (2012). Macroeconomic policy and US competiveness. Harvard Business Review, 90(3), 112–115.Google Scholar
- Waddock, S. (2002). Leading corporate citizens. New York: McGraw-Hill.Google Scholar
- Wald, M. L. (2011, December 2). Panel says Chinese imports hurt U.S. solar firms. New York Times.Google Scholar
- Wilson, G. K. (2003). Business & politics: A comparative introduction (3rd ed.). New York: Chatham House.Google Scholar
- Young, H. (2009, November 3). Astroturf lobbying organizations: Do fake grass-roots need real regulation. Illinois Business Law Journal. Posting, retrieved from http://www.law.illinois.edu/bljournal/post/2009/11/03/Astroturf-Lobbying-Organizations-Do-Fake-Grassroots-Need-Real-Regulation.aspx.