Joint Management-Stakeholder Committees: A New Path to Stakeholder Governance?

Abstract:     
Purpose: This paper describes the emerging practice of Joint‐Management‐Stakeholder‐ Committees (JMSCs) in which corporate executives take decisions in collaboration with stakeholders.

Design/methodology/approach: To identify firms involving stakeholders in their governance arrangements, we analysed 51 companies regularly participating in the Business in the Community ́s Corporate Responsibility Index in the UK. We then analyzed the data provided by the index as well as corporate reports to evaluate the impact of JMSCs on corporate decisionmaking.

Findings: This research finds that JMSCs strongly influence corporate governance mechanisms such as monitoring, measurement as well as policy development of firms.

Research limitations/applications: Our analysis builds on corporate responses given to the questionnaire sent by the Corporate Responsibility Index as well as corporate reports. Future research is encouraged to triangulate findings with stakeholder opinions on the effectiveness of JMSCs.

Practical implications: JMSCs prove to be an effective tool to involve stakeholders in corporate decisionmaking processes. Due to their effectiveness JMSCs are more likely to create trust between firms and their stakeholders.

Originality/value: This paper is the first empirical investigation into the effectiveness of engaging stakeholders in Joint‐Management‐Stakeholder Committees, demonstrating the impact and effectiveness of such engagement.

Number of Pages in PDF File: 17

Keywords: corporate responsibility, corporate governance, governance structures, stakeholder, stakeholder governance

JEL Classification: M14

Accepted Paper Series