Investors’ reactions to companies’ stakeholder management: the crucial role of assumed costs and perceived sustainability

Abstract

Companies regularly have to address opposing interests from their shareholding and non-shareholding stakeholder groups. Consequently, a wealth of previous research has focused on how CEOs decide which stakeholder management activities to pursue and prioritize. In contrast, however, surprisingly little research has considered how (potential) investors react to a company's management of shareholding and non-shareholding stakeholders and what factors drive their reactions in such contexts. We seek to fill this gap in the literature by conducting an experimental scenario study (N = 997) in which investment behavior is analyzed in situations in which management has to make a trade-off between shareholders' and non-shareholding stakeholders' interests. Our results show that (potential) investors consider the assumed costs of fulfilling non-shareholding stakeholders' interests and the perceived sustainability of doing so for corporate success when making investment decisions in such contexts. In cases of low costs or high sustainability, participants were more willing to invest in a company that favored nonshareholding over shareholding stakeholders (thereby deciding against their immediate financial interests), while the opposite was true in cases of high costs or low sustainability. With these results, our paper broadens stakeholder theory's focus by taking individual investors' reactions to corporate stakeholder management into account. Moreover, it both provides evidence for and extends the ''Enlightened & Tanja Schwarzmüller

Responsabilidad social corporativa al servicio de la salud: explorando sobre los intereses de los consumidores

“…Desde el punto de vista de la sociedad, el coste social y económico de las enfermedades no transmisibles (ENT) asociadas a la alimentación (Potvin Kent et al, 2020;World Health Organization, 2021) justifica su consideración en el ámbito de la RSC, dentro de su dimensión social en lo concerniente a la salud McLennan & Banks, 2019), junto a otro tipo de actuaciones relativas a otras dimensiones de la RSC, que gozan de gran popularidad, como las orientadas a la sostenibilidad medioambiental y a múltiples causas relacionadas con colectivos y minorías (Lee, 2020;Nave & Ferreira, 2019;Schwarzmuller, Brosi, Stelkens, Sporrle, & Welpe, 2017;Sharma, 2019).…”

Devising a fuzzy stakeholder model for optimizing the portfolio of projects at a fishing industrial enterprise taking risks into account

“…Modern studies on optimization of project management actively use the theory of stakeholders. In papers [2][3][4], both systematization in the theoretical aspects of the theory of stakeholders, and the application of the theory to practice in specific optimization models are offered. In particular, article [2] proposes the concept of "shadows of the context" to analyze stakeholders in project management.…”

“…The development of such tools would make it possible to coordinate better the behavior of stakeholders with the needs of a project. Paper [3] considered the priorities for management of a company by stakeholders in terms of attracting potential investors. The experimental study of how and based on what factors potential investors react to prioritizing the interests of owners and other stakeholders in company management.…”

“…Table 4 givess calculation results.. Table 3 Fuzzy values of scenarios probability To calculate the significance of projects with regard to requirements of other stakeholders, the parameters shown in Table 1 are ranked in an expert way separately for each stakeholder. Then, the weights of parameters are determined from formula (3). The parameter weight indicates its importance for a stakeholder when evaluating a project under conditions of a scenario.…”

An Algorithm for Modelling the Impact of the Judicial Conflict-Resolution Process on Construction Investment

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