Social Contracting as a Trust-Building Process of Network Governance

Calton, Jerry M.; Lad, Lawrence J.

doi:10.5840/10.2307/3857357

Cited by 24 publications

(32 citation statements)

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“…This is not to say that activists should shrink from criticism, but rather that they should do so in ways that engender continued interaction and trust (Calton and Lad, 1995). Long-term success in Dialogues between corporations and their shareholder critics requires that both parties tone down their public rhetoric and instead exchange views in ways that bring about common ground -even if doing so seems to take a long period of time.…”

Section: Lessons For Activistsmentioning

confidence: 94%

“…Confrontation may in some circumstances allow activists to achieve those goals. But in many cases, Dialogue and collaboration may be more effective (Calton and Lad, 1995;Calton and Payne, 2003). Rather than seeking publicity, many shareholder activists use the resolution process as a tool to enter into a long-term relationship with a company that promotes mutual understanding and creates the possibility of a partnership.…”

Section: Lessons For Companiesmentioning

confidence: 97%

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Beyond the Proxy Vote: Dialogues Between Shareholder Activists and Corporations

2008

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Section: Lessons For Activistsmentioning

confidence: 94%

Section: Lessons For Companiesmentioning

confidence: 97%

Beyond the Proxy Vote: Dialogues Between Shareholder Activists and Corporations

2008

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“…However, the governance of unfolding, incomplete relational contracts in networks tends to engage participants in a process of joint discovery to find common ground for building trust and enabling on-going cooperation. Thus, the process of social contracting in networks is more dynamic, open-ended, and pluralist than is the process of social contracting in hierarchies (Calton and Lad, 1995).…”

Section: Social Contracting In a Pluralist Process Of Moral Sense Makingmentioning

confidence: 99%

Social Contracting in a Pluralist Process of Moral Sense Making: A Dialogic Twist on the ISCT

Calton

2006

J Bus Ethics

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This paper applies Wempe’s ( 2005 , Business Ethics Quarterly 15(1), 113–135) boundary conditions that define the external and internal logics for contractarian business ethics theory, as a system of argumentation for evaluating current or prospective institutional arrangements for arriving at the â€œgood life,â€\x9D based on the principles and practices of social justice. It does so by showing that a more dynamic, process-oriented, and pluralist ‘dialogic twist’ to Donaldson and Dunfee’s ( 2003 , ‘Social Contracts: sic et non’, in P. Heugens, H. van Oosterhout and J. Vromen (eds.), The Social Institutions of Capitalism: Evolution and Design of Social Contracts (Cheltenham, UK, Edward Elgar Publishing, Ltd.) pp. 109–126; 1999 , Ties that Bind: A Social Contracts Approach to Business Ethics (Boston, MA, Harvard Business School Press); 1995 , Economics and Philosophy 11(1), 85–112; 1994 , Academy of Management Review 19(2), 252–284.) integrated social contracting theory (ISCT) of economic ethics will further develop this promising and influential approach to moral reasoning, ethical decision-making, and stakeholder governance. This evolutionary, interactive learning-based model of ethical norm generation via dialogic stakeholder engagement is particularly appropriate within economic communities that are experiencing value conflict and pressures for institutional change. Copyright Springer Science+Business Media, Inc. 2006ISCT, discourse ethics, stakeholder dialogue, pluralist sense making processes,

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“…Although both trainings and fringe benefits could be regarded as part of the ''wages'' so that the arguments of ''efficiency wage'' can be similarly applied to explain these findings, the strongly positive results on trainings carry extra implications for the maintenance of the stakeholder relationships. Calton and Lad (1995) argue that ''professional managers … must have discretionary authority within the hierarchy to resolve by 'fiat' the complex problems that arise from the interaction of participants.… Among these problems are … 'asset specificity''' (p. 276). As discussed in ''Reviews of Related Theoretical Discussions''section, employees can be discouraged to develop skills for the specific assets of their firms, which prevents them from fully participating in the stakeholder relationships.…”

Section: Introductionmentioning

confidence: 99%

Does Corporate Governance Enhance Common Interests of Shareholders and Primary Stakeholders?

2015

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Employing a unique dataset of Chinese nonlisted firms, this paper investigates the effects of the presence of 19 governance structures on 20 employees' interest indicators. In general, we find that firms with the governance structures pay workers higher hourly wages, require less monthly working hours, and have a smaller chance of wage arrears. Meanwhile, the shares of total wage and welfare expenditures in total sales revenue are lower in these firms, which results in higher profitability. Moreover, firms with the governance structures invest significantly more into training and provide employees with better fringe benefits. Considering the low labor protection standard and the weak external regulations of China's labor market, we explain the positive findings thusly: corporate governance structures induce managers to adjust wage payments to the ''efficiency wage'' level, which is the best balance point for the interests of both shareholders and employees and, therefore, for maintaining the stakeholder relationships. We also find the governance structures that give blockholders superpower are negatively associated with employees interests. These results highlight the importance of giving enough discretion to managers in order to successfully find the common ground for creating mutual values for shareholders and employees.

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Social Contracting as a Trust-Building Process of Network Governance

Cited by 24 publications

References 0 publications

Beyond the Proxy Vote: Dialogues Between Shareholder Activists and Corporations

Beyond the Proxy Vote: Dialogues Between Shareholder Activists and Corporations

Social Contracting in a Pluralist Process of Moral Sense Making: A Dialogic Twist on the ISCT

Does Corporate Governance Enhance Common Interests of Shareholders and Primary Stakeholders?

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