IDEAS home Printed from https://ideas.repec.org/a/spr/grdene/v32y2023i2d10.1007_s10726-022-09808-8.html
   My bibliography  Save this article

A Values-based Approach to Understanding Corporate- Stakeholder Interactions

Author

Listed:
  • Gary Kleinman

    (Montclair State University)

  • Dan Palmon

    (Rutgers Business School)

Abstract

This paper develops a model of focal firm-stakeholder interactions incorporating the values of each party and the possible impact of incomplete contracts between them. The paper offers a values-based analysis of the forces driving the interaction between the parties. Firms exist in a web of perceived obligations and rights. We argue that entities in firm-stakeholder relationships have operational goals supported by terminal and instrumental values that affect the way that the parties behave and interact with others. Since various parties to an interaction may have different values and goals, this model allows for strategic interactions. While some relationships are bound by law or contract, others are not. Thus, the outcome cannot be prescribed with certainty, so an important question is whether the desired outcomes can be enforced. We draw upon contract theory to explore these issues, noting that performance under any contract is problematic since it cannot be assured in advance. We argue that the determinants of outcomes between the focal firm and its stakeholder groups are affected by the values and goals of each entity, while the nature of the contracts between them and the environment within which the interactions occur influence what can be achieved.

Suggested Citation

  • Gary Kleinman & Dan Palmon, 2023. "A Values-based Approach to Understanding Corporate- Stakeholder Interactions," Group Decision and Negotiation, Springer, vol. 32(2), pages 301-326, April.
    • Handle: RePEc:spr:grdene:v:32:y:2023:i:2:d:10.1007_s10726-022-09808-8
    DOI: 10.1007/s10726-022-09808-8
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10726-022-09808-8
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10726-022-09808-8?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Michael C. Jensen, 2010. "The Modern Industrial Revolution, Exit, and the Failure of Internal Control Systems," Journal of Applied Corporate Finance, Morgan Stanley, vol. 22(1), pages 43-58, January.
    2. Bat Batjargal & Michael Hitt & Anne Tsui & Jean-Luc Arregle & Justin Webb & Toyah Miller, 2013. "Institutional Polycentrism, Entrepreneurs' Social Networks, and New Venture Growth," Post-Print hal-02276709, HAL.
    3. Herbert A. Simon, 1955. "A Behavioral Model of Rational Choice," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 69(1), pages 99-118.
    4. Gary Kleinman & Dan Palmon, 2000. "A Negotiation-Oriented Model of Auditor-Client Relationships," Group Decision and Negotiation, Springer, vol. 9(1), pages 17-45, January.
    5. Colin Eden & Fran Ackermann, 2021. "Modelling Stakeholder Dynamics for Supporting Group Decision and Negotiation: Theory to Practice," Group Decision and Negotiation, Springer, vol. 30(5), pages 1001-1025, October.
    6. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
    7. Bat Batjargal, 2013. "Institutional Polycentrism, Entrepreneurs??? Social Networks, And New Venture Growth," William Davidson Institute Working Papers Series wp1060, William Davidson Institute at the University of Michigan.
    8. Gary Kleinman & Pamela Strickland & Asokan Anandarajan, 2016. "The Accounting Court: Some Speculations on Why Not?," Group Decision and Negotiation, Springer, vol. 25(4), pages 845-871, July.
    9. Bat Batjargal & Michael Hitt & Anne Tsui & Jean-Luc Arregle & Justin Webb & Toyah Miller, 2013. "Institutional Polycentrism, Entrepreneurs' Social Networks, and New Venture Growth," Post-Print hal-02313079, HAL.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sandberg, Susanne & Sui, Sui & Baum, Matthias, 2019. "Effects of prior market experiences and firm-specific resources on developed economy SMEs' export exit from emerging markets: Complementary or compensatory?," Journal of Business Research, Elsevier, vol. 98(C), pages 489-502.
    2. Dwibedy, Punyashlok, 2022. "Informal competition and product innovation decisions of new ventures and incumbents across developing and transitioning countries," Journal of Business Venturing Insights, Elsevier, vol. 17(C).
    3. Boddewyn, Jean J. & Peng, Mike W., 2021. "Reciprocity and informal institutions in international market entry," Journal of World Business, Elsevier, vol. 56(1).
    4. Sohrab Soleimanof & Kulraj Singh & Daniel T. Holt, 2019. "Micro-Foundations of Corporate Entrepreneurship in Family Firms: An Institution-Based Perspective," Entrepreneurship Theory and Practice, , vol. 43(2), pages 274-281, March.
    5. Liu, Xiaohui & Xia, Tianjiao & Jiangyong, Lu & Lin, Daomi, 2019. "Under what institutional conditions does overseas business knowledge contribute to firm performance?," International Business Review, Elsevier, vol. 28(3), pages 588-602.
    6. Hongjuan Zhang & Rong Han & Liang Wang & Runhui Lin, 2021. "Social capital in China: a systematic literature review," Asian Business & Management, Palgrave Macmillan, vol. 20(1), pages 32-77, February.
    7. Lin, Daomi & Zheng, Wei & Lu, Jiangyong & Liu, Xiaohui & Wright, Mike, 2019. "Forgotten or not? Home country embeddedness and returnee entrepreneurship," Journal of World Business, Elsevier, vol. 54(1), pages 1-13.
    8. Hongjuan Zhang & Rong Han & Liang Wang & Runhui Lin, 0. "Social capital in China: a systematic literature review," Asian Business & Management, Palgrave Macmillan, vol. 0, pages 1-46.
    9. Chan, Christine M. & Du, Jialin, 2022. "Formal institution deficiencies and informal institution substitution: MNC foreign ownership choice in emerging economy," Journal of Business Research, Elsevier, vol. 142(C), pages 744-761.
    10. Songsong Cheng & Qunpeng Fan & Yang Song, 2023. "Performance Gap and Innovation Ambidexterity: A Moderated Mediation Model," Sustainability, MDPI, vol. 15(5), pages 1-22, February.
    11. Hmieleski, Keith M. & Sheppard, Leah D., 2019. "The Yin and Yang of entrepreneurship: Gender differences in the importance of communal and agentic characteristics for entrepreneurs' subjective well-being and performance," Journal of Business Venturing, Elsevier, vol. 34(4), pages 709-730.
    12. Hongjuan Zhang & Liang Wang & Rong Han, 2019. "The China-West divide on social capital: A meta-analysis," Asia Pacific Journal of Management, Springer, vol. 36(3), pages 745-772, September.
    13. Michael A. Hitt & David G. Sirmon & Yuan Li & Abby Ghobadian & Jean-Luc Arregle & Kai Xu, 2021. "Institutions, industries and entrepreneurial versus advantage-based strategies: how complex, nested environments affect strategic choice," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 25(1), pages 147-188, March.
    14. Mike W. Peng & Joyce C. Wang & Nishant Kathuria & Jia Shen & Miranda J. Welbourne Eleazar, 2023. "Toward an institution-based paradigm," Asia Pacific Journal of Management, Springer, vol. 40(2), pages 353-382, June.
    15. Huatao Peng & Chen Zhou & Yang Liu, 2020. "Entrepreneurial Experience and Performance: From the Aspect of Sustainable Growth of Enterprises," Sustainability, MDPI, vol. 12(18), pages 1-24, September.
    16. Luis Alfonso Dau & Jiatao Li & Marjorie A. Lyles & Aya S. Chacar, 2022. "Informal institutions and the international strategy of MNEs: Effects of institutional effectiveness, convergence, and distance," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 53(6), pages 1257-1281, August.
    17. Busch, Christian & Barkema, Harry, 2022. "Align or perish: Social enterprise network orchestration in Sub-Saharan Africa," Journal of Business Venturing, Elsevier, vol. 37(2).
    18. Murnieks, Charles Y. & Arthurs, Jonathan D. & Cardon, Melissa S. & Farah, Nusrat & Stornelli, Jason & Michael Haynie, J., 2020. "Close your eyes or open your mind: Effects of sleep and mindfulness exercises on entrepreneurs' exhaustion," Journal of Business Venturing, Elsevier, vol. 35(2).
    19. Wafa N. Almobaireek & Ahmed A. Alshumaimeri & Tatiana S. Manolova, 2016. "Building entrepreneurial inter-firm networks in an emerging economy: the role of cognitive legitimacy," International Entrepreneurship and Management Journal, Springer, vol. 12(1), pages 87-114, March.
    20. Istipliler, Baris & Bort, Suleika & Woywode, Michael, 2023. "Flowers of adversity: Institutional constraints and innovative SMEs in transition economies," Journal of Business Research, Elsevier, vol. 154(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:grdene:v:32:y:2023:i:2:d:10.1007_s10726-022-09808-8. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.