Managing Legitimacy in Complex and Heterogeneous Environments: Sustainable Development in a Globalized World

26 Pages Posted: 26 Feb 2013

See all articles by Andreas Georg Scherer

Andreas Georg Scherer

University of Zurich - IBW Department of Business Administration

Guido Palazzo

University of Lausanne

David Seidl

University of Zurich - Department of Business Administration (IBW)

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Date Written: March 2013

Abstract

The sustainability problems with regard to the production, distribution, and consumption of goods and services increasingly challenge the legitimacy of corporations. The literature distinguishes three strategies that corporations commonly employ to respond to legitimacy problems: adapt to external expectations, manipulate the perception of their stakeholders, or engage in a discourse with those who question their legitimacy. We discuss three approaches to determine the appropriate response strategy: one‐best‐way approach, contingency approach, and paradox approach. We argue that in the face of heterogeneous environments with conflicting demands, corporations that follow a paradox approach are likely to be more successful in preserving their legitimacy than those that adopt one of the other two approaches. We develop a theoretical framework for the application of different response strategies and explore the management of paradoxes by way of structural, contextual, or reflective means.

Keywords: corporate legitimacy, corporate responsibility, globalization, institutional theory, paradox, sustainability

Suggested Citation

Scherer, Andreas Georg and Palazzo, Guido and Seidl, David, Managing Legitimacy in Complex and Heterogeneous Environments: Sustainable Development in a Globalized World (March 2013). Journal of Management Studies, Vol. 50, Issue 2, pp. 259-284, 2013. Available at SSRN: https://ssrn.com/abstract=2224473 or http://dx.doi.org/10.1111/joms.12014

Andreas Georg Scherer

University of Zurich - IBW Department of Business Administration ( email )

Plattenstrasse 14
Zurich, 8032
Switzerland
+41 44-63 45302 (Phone)
+41 44-63 45301 (Fax)

HOME PAGE: http://www.business.uzh.ch/professorships/as.html

Guido Palazzo (Contact Author)

University of Lausanne ( email )

Quartier Chambronne
Lausanne, Vaud CH-1015
Switzerland

David Seidl

University of Zurich - Department of Business Administration (IBW) ( email )

Hottingerstrasse 10
Plattenstrasse 14
Zurich, 8032
Switzerland

HOME PAGE: http://www.om.uzh.ch

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