Hostname: page-component-cd9895bd7-dzt6s Total loading time: 0 Render date: 2024-12-26T23:04:24.615Z Has data issue: false hasContentIssue false
  • English
  • Français

Stakeholder Legitimacy

Published online by Cambridge University Press:  23 January 2015

Robert Phillips
Get access Rights & Permissions [Opens in a new window]

Abstract:

This paper is a preliminary attempt to better understand the concept of legitimacy in stakeholder theory. The normative component of stakeholder theory plays a central role in the concept of legitimacy. Though the elaboration of legitimacy contained herein applies generally to all “normative cores” this paper relies on Phillips’s principle of stakeholder fairness and therefore begins with a brief description of this work. This is followed by a discussion of the importance of legitimacy to stakeholder theory as well as the general ambiguity of the term. A distinction is then drawn between normative and derivative legitimacy. Reference to this distinction helps distinguish between a relationship with the organization based on direct moral obligation and one based on the power to help or harm the organization. It is concluded that stakeholders who retain the ability to affect the organization are legitimate (derivatively), but that this legitimacy is derived from the moral obligation owed other (normative) stakeholders and that the two sorts of legitimacy are importantly different from one another. An example of the normative/derivative distinction at work in managerial decision making is elaborated upon and managerial and research implications are then suggested.

Type
Articles
Information
Business Ethics Quarterly , Volume 13 , Issue 1 , January 2003 , pp. 25 - 41
Copyright
Copyright © Society for Business Ethics 2003

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Argandoña, A. 1998. “The Stakeholder Theory and the Common Good.” Journal of Business Ethics 17: 1093–1102.Google Scholar
Burton, B. K., and Dunn, C. P. 1996. “Feminist Ethics as Moral Grounding for Stakeholder Theory.” Business Ethics Quarterly 6(2): 133–48.CrossRefGoogle Scholar
Carroll, A. B. 1993. Business and Society: Ethics and Stakeholder Management, 2nd ed. Cincinnati: South-Western.Google Scholar
Clarkson, M. B. E. 1994. A Risk-Based Model of Stakeholder Theory. Toronto: The Centre for Corporate Social Performance & Ethics.Google Scholar
Clarkson, M. B. E. 1995. “A Stakeholder Framework for Analyzing and Evaluating Corporate Social Performance.” Academy of Management Review 20(1): 92–117.Google Scholar
Donaldson, T., and Dunfee, T. W. 1999. Ties That Bind. Boston: Harvard Business School Press.Google Scholar
Donaldson, T., and Preston, L. E. 1995. “The Stakeholder Theory of the Corporation: Concepts, Evidence, and Implications.” Academy of Management Review 20(1): 65–91.Google Scholar
Evan, W. M., and Freeman, R. E. 1993. “A Stakeholder Theory of the Modern Corporation: Kantian Capitalism.” In Ethical Theory and Business, 4th edition, edited by Beauchamp, Tom L. and Bowie, Norman E.Englewood Cliffs, N.J.: Prentice Hall.Google Scholar
Freeman, R. E. 1996. “Understanding Stakeholder Capitalism.” Financial Times, London Edition, July 18.Google Scholar
Freeman, R. E. 1994. “The Politics of Stakeholder Theory: Some Future Directions.” Business Ethics Quarterly 4(4): 409–22.Google Scholar
Freeman, R. E. 1984. Strategic Management: A Stakeholder Approach. Boston: Pitman Publishing Inc.Google Scholar
Freeman, R. E., and Evan, W. 1990. “Corporate Governance: A Stakeholder Interpretation.” The Journal of Behavioral Economics 19(4): 337–59.Google Scholar
Freeman, R. E., and Reed, D. 1983. “Stockholders and Stakeholders: A New Perspective on Corporate Governance. In Corporate Governance: A Definitive Exploration of the Issues, ed. Huizinga, C.Los Angeles: UCLA Extension Press.Google Scholar
Frooman, J. 1999. “Stakeholder Influence Strategies.” Academy of Management Review 24(2): 191–205.CrossRefGoogle Scholar
Hart, H. L. A. 1955. “Are There Any Natural Rights?” Philosophical Review 64.Google Scholar
Hill, C. W. L., and Jones, T. M. 1992. “Stakeholder-Agency Theory.” Journal of Management Studies 29: 131–54.Google Scholar
Jones, T. M. 1995. “Instrumental Stakeholder Theory: A Synthesis of Ethics and Economics.” Academy of Management Review 20(2): 404–37.Google Scholar
Jones, T. M., and Wicks, A. C. 1999. “Convergent Stakeholder Theory.” Academy of Management Review 24(2): 206–21.CrossRefGoogle Scholar
Kochan, T. A., and Rubinstein, S. A. 2000. “Toward a Stakeholder Theory of the Firm: The Saturn Partnership.” Organization Science 11(4): 367–86.CrossRefGoogle Scholar
March, J. G., and Simon, H. A. 1958. Organizations, 2nd ed. Cambridge, Mass.: Blackwell.Google Scholar
Marens, R., and Wicks, A. 1999. “Getting Real: Stakeholder Theory, Managerial Practice, and the General Irrelevance of Fiduciary Duties Owed to Shareholders.” Business Ethics Quarterly 9(2): 273–93.Google Scholar
Mitchell, R. K., Agle, B. R., and Wood, D. J. 1997. “Toward a Theory of Stakeholder Identification and Salience: Defining the Principle of Who and What Really Counts.” Academy of Management Review 22(4): 853–86.Google Scholar
Orts, E. 1992. “Beyond Shareholders: Interpreting Corporate Constituency Statutes. George Washington Law Review 61: 14–135.Google Scholar
Orts, E. 1997. “A North American Legal Perspective on Stakeholder Management Theory.” In Perspectives on Company Law 2, ed. Patfield, F.Boston: Institute of Advanced Legal Studies: 165–79.Google Scholar
Pfeffer, J. 1981. “Management as Symbolic Action: The Creation and Maintenance of Organizational Paradigms.” In Research in Organizational Behavior, vol. 13: 1–52. Edited by Cummings, L. L. and Staw, B. M.Greenwich, Conn.: JAI Press.Google Scholar
Pfeffer, J., and Salancik, G. 1978. The External Control of Organizations. New York: Harper and Row.Google Scholar
Phillips, R. A. 1997. “Stakeholder Theory and a Principle of Fairness.” Business Ethics Quarterly 7(1): 51–66.Google Scholar
Phillips, R. A. 2000. “Remarks on Marcoux: Defending Stakeholder Theory.” In Contemporary Issues in Business Ethics, 4th edition. Edited by DesJardins, J. R. and McCall, J. J.Belmont, Calif.: Wadsworth.Google Scholar
Phillips, R. A., and Margolis, J. M. 1999. “Toward an Ethics of Organizations.” Business Ethics Quarterly 9(4): 637–56.Google Scholar
Phillips, R. A., and Reichart, J. 2000. “The Environment as a Stakeholder? A Fairness Based Approach.” Journal of Business Ethics (23)2.Google Scholar
Rawls, John. 1964. “Legal Obligation and the Duty of Fair Play.” In Law and Philosophy, ed. Hook S.. New York University Press.Google Scholar
Rawls, John. 1971a. A Theory of Justice. Cambridge, Mass.: The Belknap Press of Harvard University Press.Google Scholar
Rawls, John. 1971b. “Justice as Reciprocity.” In John Rawls: Collected Papers, ed. Freeman, Samuel. 1999. Cambridge, Mass.: Harvard University Press, 190–224.Google Scholar
Rawls, John. 1993. Political Liberalism. New York: Columbia University Press.Google Scholar
Rowley, T. J. 1997. “Moving Beyond Dyadic Ties: A Network Theory of Stakeholder Influences.” Academy of Management Review 22(4): 887–910.CrossRefGoogle Scholar
Simmons, A. J. 1979. Moral Principles and Political Obligations. Princeton, N.J.: Princeton University Press.Google Scholar
Starik, M. 1995. “Should Trees Have Managerial Standing? Toward Stakeholder Status for Non-Human Nature.” Journal of Business Ethics 14: 207–17.Google Scholar
Suchman, M. C. 1995. “Managing Legitimacy: Strategic and Institutional Approaches.” Academy of Management Review 20(3): 571–610.Google Scholar
Thompson, J. 1967. Organizations in Action. New York: McGraw Hill.Google Scholar
Van Buren III, Harry J. 2001. “If Fairness Is the Problem, Is Consent the Solution? Integrating ISCT and Stakeholder Theory.” Business Ethics Quarterly 11(3): 481–500.Google Scholar
Weber, M. 1947. The Theory of Social and Economic Organization. New York: Free Press.Google Scholar
Werhane, P. 1999. Moral Imagination and Management Decision-Making. New York: Oxford University Press.Google Scholar
Wicks, A. C., and Freeman, R. E. 1998. “Organization Studies and the New Pragmatism: Positivism, Anti-Positivism, and the Search for Ethics.” Organization Science 9(2): 123–40.CrossRefGoogle Scholar
Wicks, A. C., Gilbert, D. R. Jr., and Freeman, R. E. 1994. “A Feminist Reinterpretation of the Stakeholder Concept.” Business Ethics Quarterly 4(4): 475–98.Google Scholar