Study Reviews Stakeholder Engagement Field: Past, Present, and Future
These professors in Finland and Switzerland—Johanna Kujala, Professor at Tampere University, Finland; Heta Leinonen, Doctoral Researcher in the Circular Economy, Tampere University, and Sybille Sachs, Professor at HWZ University of Applied Sciences in Business Administration Zurich, Switzerland—have provided a must-read for anyone serious about understanding the true nature of Stakeholder Capitalism. Their work provides that the origins of Stakeholder Capitalism have nothing to do with "Woke" or "Fig Leaf" capitalism.
An Academic Definition
The Challenge of Fragmentation
Three professors from Europe have published a meta-analysis of academic research in the field of Stakeholder Engagement, which they say “has grown into a widely used yet often unclear construct in business and society research. The literature lacks a unified understanding of the essentials of Stakeholder Engagement, and the fragmented use of the Stakeholder Engagement construct challenges its development and legitimacy.”In this academic article, Stakeholder Engagement: Past, Present, and Future, the authors attempt to “clarify the construct of Stakeholder Engagement to unfold the full potential of Stakeholder Engagement research.” They write that they reviewed 90 articles in leading academic journals related to business and society, management and strategy and environmental policy. They provide a “descriptive analysis” of Stakeholder Engagement over a 15-year period and identify “moral, strategic, and pragmatic components of Stakeholder Engagement as well as its aims, activities, and impacts.”
Their study also provides a library of useful links on academic research from all perspectives.
An Academic Definition
Stakeholder Engagement, the authors write, “refers to the aims, activities, and impacts of stakeholder relations in a moral, strategic, and/or pragmatic manner.” Note: the definition for Enterprise Engagement, published in 2009 on Wikipedia, is “a sub-discipline of marketing and management that focuses on achieving long-term financial results by strategically fostering the proactive involvement and alignment of customers, distribution partners, salespeople, and all human capital outside and inside of an organization.” The authors say that the topic “has grown into a widely used construct in business and society research and related streams of literature. The construct has gained traction under the premise that it is highly applicable to understanding and explaining the relationships between organizations and stakeholders, such as employees, customers, suppliers, competitors, local communities and citizens, and the various outcomes of these relations.” They cite the following references: Aakhus & Bzdak, 2015; Business Roundtable, 2019; Freeman et al., 2017; Greenwood, 2007; Kujala & Sachs, 2019; J. R. Mitchell et al., 2022; Noland & Phillips, 2010; Sachs & Kujala, 2021b.
As a basis for evaluating the field, “we follow the widely used understanding of stakeholders as individuals, groups, or organizations that affect or are affected by organizational activities (Freeman, 1984).
Research, they write, “has provided insight into the importance of Stakeholder Engagement in crucial organizational activities, such as value creation (Freudenreich et al., 2020; Harrison et al., 2010; Harrison & Wicks, 2013), strategic planning and decision-making (Castelló et al., 2016; Noland & Phillips, 2010; Ramus & Vaccaro, 2017), innovation (Alvarez & Sachs, 2021; Baltazar Herrera, 2016; Bendell & Huvaj, 2020; Goodman et al., 2017; Scuotto et al., 2020; Watson et al., 2020), learning and knowledge creation (Desai, 2018; J. R. Mitchell et al., 2022; Phillipson et al., 2012), and accounting and reporting (Böhling et al., 2019; Johansen, 2008; Manetti & Toccafondi, 2012; O’Riordan & Fairbrass, 2014) as well as Corporate Social Responsibility (CSR) and sustainability (Arenas et al., 2009; Banerjee & Bonnefous, 2011; Dobele et al., 2014; Lindgreen & Swaen, 2010). In addition, prior research has explained the politics and democratic principles of Stakeholder Engagement (Dawkins, 2015, 2021; Holzer, 2008) and examined how stakeholder activism influences organizational activities (de Bakker et al., 2013; den Hond & de Bakker, 2007).”
The Challenge of Fragmentation
While they note the increased interest in the subject, the research has resulted in what they say is “a heterogeneous or even fragmented research area. Many authors, especially in the business and society as well as the management and strategy literature, draw on stakeholder theory (Freeman, 1984; Freeman et al., 2010) and approach Stakeholder Engagement as a way of practicing the ideas of stakeholder theory (Freeman et al., 2017; Greenwood, 2007). Stakeholder Engagement research drawing on stakeholder theory has typically focused on conceptual and theoretical development (Dawkins, 2015; Desai, 2018; Greenwood, 2007; Patzer et al., 2018) as well as the organizational and societal benefits of Stakeholder Engagement (Cheng et al., 2014; Gupta et al., 2020; Henisz et al., 2014; Jones et al., 2018; Lumpkin & Bacq, 2019). In addition, the related environmental management and environmental policy literature has complemented Stakeholder Engagement research with a distinctively more practice-oriented approach drawing on stakeholder theory or policy literature or their combinations (Papagiannakis et al., 2019; Reed et al., 2009; Shackleton et al., 2019).
The authors believe that a lack of a consensus around the essentials of Stakeholder Engagement hinders the progress of research. “Some scholars have attempted to provide general frameworks for research on Stakeholder Engagement (Freeman et al., 2017; Kujala & Sachs, 2019), while others have elaborated on how Stakeholder Engagement differs from strategic management, stakeholder integration, or stakeholder theory (Noland & Phillips, 2010; Pedrini & Ferri, 2019; Svendsen, 1998).”
They continue, “While previous literature reviews exist on stakeholder theory, definition, and salience (Laplume et al., 2008; Miles, 2017; Wood et al., 2021), to our knowledge, a dedicated literature review on Stakeholder Engagement is lacking. This is a shortcoming for several reasons. Without a settled and comprehensive view of the essentials of the construct, research in Stakeholder Engagement cannot establish internal identity or external distinctiveness. A fragmented conceptual base hinders the operationalization of the construct, thus hampering both the empirical development and subsequent practical relevance of the research (Aguinis et al., 2018; Antolin-Lopez et al., 2019; Suddaby et al., 2017). In the end, the legitimacy, validity, and practical relevance of the construct are at risk, and scholarly attempts for rigorous research become deterred.”
In writing this paper, the authors’ goal, they says, is to help address these challenges. “The purpose of this article is to clarify the construct of Stakeholder Engagement to unfold the full potential of Stakeholder Engagement research and inspire its further development. In doing so, we ask: How to understand and organize the fragmented Stakeholder Engagement research? Furthermore, to capture the essentials of Stakeholder Engagement, we ask one simple but highly relevant question: What are the components and contents of Stakeholder Engagement?”
Master the “S” of Environmental, Social, Governance (ESG), A.k.a. Stakeholder Capitalism
The Enterprise Engagement Alliance at TheEEA.org is the world’s first and only organization that focuses on outreach, certification and training, and advisory services to help organizations achieve their goals by fostering the proactive involvement of all stakeholders. This includes customers, employees, distribution and supply chain partners, and communities, or anyone connected to an organization’s success.
Training and Thought Leadership
- Founded in 2008, the Enterprise Engagement Alliance provides outreach, learning and certification in Enterprise Engagement, an implementation process for the “S” or Social of Stakeholder Capitalism and Human Capital Management and measurement of engagement across the organization.
- The Enterprise Engagement Alliance provides a training and certification program for business leaders, practitioners, and solution providers, as well as executive briefings and human capital gap analyses for senior leaders.
- The EEA produces an education program for CFOs for the CFO.University training program on Human Capital Management.
- Join the EEA to become a leader in the implementation of the “S” of ESG and Stakeholder Capitalism.
Engagement Digital Media and Marketplaces
- The ESM information portal and The Enterprise Engagement Advisors Network solution provider marketplace cover all aspects of stakeholder engagement, and the EEA information library lists dozens of resources.
- The RRN information portal and Brand Media Coalition marketplace address the use of brands for gifting, incentives, recognition, and promotions. The BMC information library provides information and research resources.
Video Learning
The EEA Human Capital Management and ROI of Engagement YouTube channel features a growing library of 30- to 60-minute panel discussions with leading experts in all areas of engagement and total rewards.
Books
- Enterprise Engagement for CEOs: The Little Blue Book for People-Centric Capitalists. A quick guide for CEOs.
- Enterprise Engagement: The Roadmap 5th Edition implementation guide. A comprehensive textbook for practitioners, academics, and students.
Enterprise Engagement Advisory Services
The Engagement Agency helps:
- Organizations of all types develop strategic Stakeholder Capitalism and Enterprise Engagement processes and human capital management and reporting strategies; conduct human capital gap analyses; design and implement strategic human capital management and reporting plans that address DEI (Diversity, Equity, and Inclusion), and assist with managed outsourcing of engagement products and services.
- Human resources, sales and marketing solution providers profit from the emerging discipline of human capital management and ROI of engagement through training and marketing services.
- Investors make sense of human capital reporting by public companies.
- Buyers and sellers of companies in the engagement space or business owners or buyers who seek to account for human capital in their mergers and acquistions.
For more information: Contact Bruce Bolger at Bolger@TheICEE.org or call 914-591-7600, ext. 230.
