Stakeholder Governance - An Analysis of BITC Corporate Responsibility Index Data on Stakeholder Engagement and Governance

Doughty Centre for Corporate Responsibility Occasional Paper, 2010

36 Pages Posted: 11 Oct 2010 Last revised: 18 Oct 2014

See all articles by Erik G. Hansen

Erik G. Hansen

Johannes Kepler University (JKU) Linz

Heiko Spitzeck

Fundação Dom Cabral

Date Written: September 1, 2010

Abstract

Our current social, environmental, and economic systems are being confronted with global, interlinked problems such as environmental degradation, loss of biodiversity, climate change, and social inequalities and exclusion. Against this background, corporate responsibility (CR) and sustainability have become topics of high interest in business, academia, and the political sphere alike. It is increasingly understood that organisations can not have a full perspective of the issues, opportunities and threats that they face without the help of outside experts. Thus, for organisations (especially large ones) it is increasingly common practice to engage in different forms of ‘stakeholder engagement’ in order to source external views and thereby improve internal decision-making. Possible examples of engagement techniques include stakeholder surveys, stakeholder dialogue fora and partnerships with non-governmental organisations (NGOs). However, existing research on, and the practice of, stakeholder engagement often too strongly focuses on mere ‘engagement,’ whereas the actual links to internal decision-making remain vague. In other words, there exists “a gap between stakeholder engagement and governance”. Indeed, few empirical investigations have evaluated how stakeholder input is taken into account in relation to internal decision-making. This paper will elaborate on (voluntary mechanisms of) stakeholder engagement with a focus on how stakeholders can indeed influence corporate decision-making – what we then call ‘stakeholder governance’ because their views have an impact on how 'companies are directed and controlled.' To pursue this goal, we use a systematic analysis of 51 company responses with reference to stakeholder relationships from the Business in the Community (BITC) Corporate Responsibility Index (2002-20081). While research has considered the importance of stakeholders being involved in corporate decision-making, apart from anecdotal evidence, few empirical investigations have evaluated how stakeholder input is taken into account within internal decision-making. Prior exploratory research has identified at least four dimensions as being important for stakeholder governance.

Keywords: Stakeholder Governance, Corporate Governance, Stakeholder Engagement, Committees

JEL Classification: G30, M14

Suggested Citation

Hansen, Erik G. and Spitzeck, Heiko, Stakeholder Governance - An Analysis of BITC Corporate Responsibility Index Data on Stakeholder Engagement and Governance (September 1, 2010). Doughty Centre for Corporate Responsibility Occasional Paper, 2010. Available at SSRN: https://ssrn.com/abstract=1690600

Erik G. Hansen (Contact Author)

Johannes Kepler University (JKU) Linz ( email )

Linz
Austria

HOME PAGE: http://www.jku.at/iqd/content/e288348

Heiko Spitzeck

Fundação Dom Cabral ( email )

Avenida Princesa Diana 760, Alphaville
Nova Lima, 34000000
Brazil
+551172769574 (Phone)

HOME PAGE: http://www.fdc.org.br

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