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The Impact of Stakeholder Identities on Value Creation in Issue-Based Stakeholder Networks

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Abstract

In this conceptual paper, we draw on social identity theory as a means to bridge individuals’ memberships in social groups with value creation in stakeholder networks defined by a socio-economic issue. To address recent calls for microfoundations of stakeholder theory, we introduce a reconceptualization of stakeholders as social groups to examine how value is defined and interpreted in intergroup processes embedded in an issue-based stakeholder network. We establish a theoretical model of value creation that links individuals’ identification with stakeholder groups to intergroup trust, co-operation, and value creation. Specifically, we argue that the salience of preexisting social identities causes harmful tensions in stakeholder relationships that negatively impact value creation. We then propose that the development of a more inclusive stakeholder identity overcomes these negative intergroup consequences in multistakeholder settings. We discuss the impact on value creation of four stakeholder identity representations based on the salience of specific and superordinate stakeholder groups. The paper concludes with implications of our theoretical model for both research and practice related to value creation in issue-based stakeholder networks.

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Notes

  1. Note that during an inductive identity salience process, intergroup trust, co-operation, and value creation develop simultaneously due to continuous interactions and communication among the stakeholder representatives. However, for explanatory reasons, we retain a linear process in our model.

  2. We are aware that we postulate a direct link of innovative products and services to value creation in issue-based stakeholder networks (see also Van de Ven et al. 1999). This link is not undisputed in the economic literature and various conditional effects have been analyzed (Lepak et al. 2007). However, for reasons of space, we do not provide a full review of this literature and stick to the established RbV argumentation that the combination of heterogeneous resources leads to innovation and, hence, value creation in an organizational context. Barney (1991, p. 107) stated: “Indeed, firms with such resources will often be strategic innovators, for they will be able to conceive of and engage in strategies that other firms could either not conceive of, or not implement, or both, because these other firms lacked the relevant firm resources.” In addition, Sachs and Rühli (2011) as well as Bridoux and Stoelhorst (2015) provide a detailed discussion of this line of argumentation regarding issue-based stakeholder networks.

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  1. Institute for Strategic Management, HWZ University of Applied Sciences in Business Administration Zurich, Lagerstrasse 5, 8021, Zurich, Switzerland

    Thomas Schneider & Sybille Sachs

  2. Institute of Psychology, University of Bern, Bern, Switzerland

    Thomas Schneider

  3. Department of Business Administration, University of Zurich, Zurich, Switzerland

    Sybille Sachs

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Schneider, T., Sachs, S. The Impact of Stakeholder Identities on Value Creation in Issue-Based Stakeholder Networks. J Bus Ethics 144, 41–57 (2017). https://doi.org/10.1007/s10551-015-2845-4

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