Stakeholder Salience And Corporate Social Responsibility: Evidence From Three Companies

Abstract

In this paper, we examine the corporate social responsibility (CSR) efforts of three socially conscious companies over time by employing Mitchell et al.’s (1997) stakeholder salience theory.  Mitchell et al. maintain that the extent to which managers pay attention to the interests of various stakeholder groups is based on the power, legitimacy, and urgency of the claims of each group.  Using these attributes of power, legitimacy, and urgency, we analyze how the CSR activities of Ben and Jerry’s Ice Cream, Malden Mills, Inc., and Nova Chemicals Company have changed over time.  Our investigation revealed that attributes of stakeholder salience shift over a firm’s life cycle, and therefore levels of CSR activities change as well.  For these firms, we found that power is the primary attribute of stakeholder salience driving CSR.  That is, in order for a firm to engage in purposeful CSR activities, the stakeholder(s) pursuing a CSR agenda must possess the power to impose such an agenda on management.  Based on the results of our analysis, we conclude that without power, legitimacy and urgency may not provide sufficient stakeholder salience to promote CSR activities.