Business Commons^™

How Applying Instrumental Stakeholder Theory Can Provide Sustainable Competitive Advantage, Thomas M. Jones, Jeffrey S. Harrison, Will Felps

Management Faculty Publications

Instrumental stakeholder theory considers the performance consequences for firms of highly ethical relationships with stakeholders, characterized by high levels of trust, cooperation, and information sharing. While research suggests performance benefits, an obvious question remains: If instrumental stakeholder theory-based stakeholder treatment is so valuable, why isn't it the dominant mode of relating to stakeholders? We argue that the existing instrumental stakeholder theory literature has three shortcomings that limit its ability to explain variance in performance. (1) Little theory exists around how instrumental stakeholder theory-based stakeholder management could provide sustainable competitive advantage. (2) The literature has largely neglected the potential downsides (i.e., …

Employee And Coworker Idiosyncratic Deals: Implications For Emotional Exhaustion And Deviant Behaviors, Dejun Tony Kong, Violet T. Ho, Sargam Garg

Management Faculty Publications

By integrating conservation of resources and social comparison perspectives, we seek to investigate how employees’ own i-deals, independently from and jointly with their coworker’s i-deals, determine their emotional exhaustion and subsequent deviant behaviors. We conducted a field study (131 coworker dyads) focusing on task i-deals, and used Actor–Partner Interdependence Model and polynomial regression to test the hypotheses. We found that emotional exhaustion not only mediated the negative relationship between employees’ own task i-deals and deviant behaviors, but also mediated the positive relationship between upward social comparison of task i-deals (i.e., a coworker’s vs own task i-deals) and deviant behaviors. These …

Sturm, Ruger & Co And The U.S. Firearms Industry, Eryn Berquist, Julian Cha, Jeffrey S. Harrison, Kelsey Heady, Lindsay Kennedy, Will Macllwiane, Bikram Saini, Natalie Schmidt, Jason Werst

Robins Case Network

Ruger is one of the largest domestic gun and ammunition manufacturers in the United States, and also one of the most successful. Ruger makes very high quality guns at reasonable prices. The company also emphasizes research and development. With no debt and high gross profit margins, one would expect Ruger to be an outstanding investment. However, the U.S. gun industry is extremely volatile and also very competitive. Due to mass shootings, terrorism, and other highly visible events, there is ever increasing pressure for new regulation and restrictions on gun ownership and use. However, the industry has a very powerful friend …

Pfizer, Jeffrey S. Harrison, Ryan Mcgowan, Kevin O'Neill, Lauren Shotwell, Joshua Torres

Robins Case Network

Pfizer was established in 1849 in Brooklyn, New York by cousins Charles Pfizer and Charles Erhart with a loan of $2,500 from Pfizer’s father.² Today, 167 years later, Pfizer Inc. has international revenues of $49 billion, which makes it the second-largest pharmaceutical manufacturer in the world.³ Despite Pfizer’s success, the company has faced many challenges over the last few decades. The pharmaceutical industry is heavily influenced by legal, political, and technological forces, and all indications are that the industry will continue to experience dramatic changes.

The Volkswagen Scandal, Britt Blackwelder, Katerine Coleman, Sara Colunga-Santoyo, Jeffrey S. Harrison, Danielle Wozniak

Robins Case Network

Volkswagen is one of the largest automobile manufacturers in the world. For years the company has focused on producing attractive and environmentally friendly automobiles, and recent initiatives have included a project to reduce CO² production, along with advertisements claiming lower emission of greenhouse gases. The world was shocked to hear that Volkswagen had been producing diesel engines for its cars that were able to trick emissions testing equipment. The engines were producing many times the EPA standards for emissions, yet they passed emission tests. This case provides detailed information about the scandal as well as information about the history, …

Stakeholder Theory As An Ethical Approach To Effective Management: Applying The Theory To Multiple Contexts, Jeffrey S. Harrison, R. Edward Freeman, Mônica Cavalcanti Sá De Abreu

Management Faculty Publications

This article provides a brief overview of stakeholder theory, clears up some widely held misconceptions, explains the importance of examining stakeholder theory from a variety of international perspectives and how this type of research will advance management theory, and introduces the other articles in the special issue.

Retaliating Against Customer Interpersonal Injustice In A Singaporean Context: Moderating Roles Of Self-Efficacy And Social Support, Violet Ho, Naina Gupta

Management Faculty Publications

Few studies have examined the relationship between customer injustice and employees' retaliatory counterproductive behaviors toward customers, and those that have done so have been conducted in a Western setting. We extend these studies by examining the relationship in a Singaporean context where retaliatory behaviors by employees might be culturally constrained. While the previously established positive relationship between customer injustice and counterproductive behaviors was not replicated using peer-reported data from employees across two hotels in Singapore, we found that individuals' self-efficacy and perceived social support moderated it. Specifically, the injustice-to-counterproductive behaviors relationship was positive for individuals with high self-efficacy, and for …

A Social Connection Approach To Corporate Responsibility: The Case Of The Fast-Food Industry And Obesity, Judith Schrempf-Stirling

Management Faculty Publications

Corporate responsibility for consumption-related issues has been on the business ethics agenda for several decades. However, some recent consumption-related issues, such as obesity, differ qualitatively from the traditional product liability cases. This study proposes an alternative responsibility concept, referred to as the social connection corporate responsibility (CR). A detailed conceptualization of a social connection CR is presented and subsequently contrasted with the liability approach to CR. Then, a social connection logic to the case of obesity is applied followed by an examination of how fast-food chains are socially connected to obesity, and of what kind of responsibilities such a …

The First-Year Seminar: An Innovative Way For Business Law Professors To Integrate Liberal Arts Pedagogy Into Undergraduate Business Education, Porcher L. Taylor Iii, Lewis A. Litteral

School of Professional and Continuing Studies Faculty Publications

We begin with a brief historical perspective of first-year experiences and how, through a 30-year journey, that pedagogical innovation recently and literally flipped upside down my approach to produce student learning. Then we will examine the genesis, development, and teaching of my current FYS Water: Economics, Politics and Policy, and why it has been such a successful course at my university. Next, my coauthor will examine the genesis, development, and teaching of his FYS Morality and the Great Recession of 2008-2009, another successful example of the FYS at our university.

With that as a pedagogical foundation, we offer …

Safaricom: Innovative Telecom Solutions To Empower Kenyans, Laura Beauchesne, Nick Dorion, Nathaniel Griggs, Jeffrey S. Harrison

Robins Case Network

Safaricom is thriving by selling what many would consider a luxury product in an impoverished country. Africa is a vast market for telecommunications, and Kenya is the third largest mobile market. It is also one of the fastest growing economies in the region. This case contains a fascinating perspective on Kenya, and on the range of services Safaricom provides to its citizens. It also contains excellent detail on Safaricom’s business and philanthropic strategies.

Anticipating, Preventing, And Surviving Secondary Boycotts, Judith Schrempf-Stirling, Douglas A. Bosse, Jeffrey S. Harrison

Management Faculty Publications

Even the best stakeholder-managed firms can suffer when they become the targets of a secondary boycott, as recent headlines attest. A secondary boycott is a group’s refusal to engage a target firm with which the group has no direct dispute in an attempt to sway public opinion, draw attention to an issue, or influence the actions of a disputant. This article provides a new perspective and tools for both scholars and managers concerned with this phenomenon. Building on a stakeholder theory foundation, we examine possible actions managers can take to avoid being surprised by a secondary boycott, propose conditions that …

Upstream Corporate Social Responsibility: The Evolution From Contract Responsibility To Full Producer Responsibility, Judith Schrempf-Stirling, Guido Palazzo

Management Faculty Publications

The debate about the appropriate standards for upstream corporate social responsibility (CSR) of multinational corporations (MNCs) has been on the public and academic agenda for some three decades. The debate originally focused narrowly on “contract responsibility” of MNCs for monitoring of upstream contractors for “sweatshop” working conditions violating employee rights. The authors argue that the MNC upstream responsibility debate has shifted qualitatively over time to “full producer responsibility” involving an expansion from “contract responsibility” in three distinct dimensions. First, there is an expansion of scope from working conditions to human rights and social and environmental impacts broadly defined. Second, there …

India - Censorship For A Good Cause?, Judith Schrempf-Stirling

Robins Case Network

Information technology (IT) companies face significant censorship challenges in countries such as China and India. This case deals with the ethical issues associated with government censorship, and specifically whether corporations that comply with such censorship are complicit in violating basic human rights. The context is India, and the case provides a summary of relevant cultural and legal issues in this very turbulent country.

Roche’S Clinical Trials With Organs From Prisoners: Does Profit Trump Morals?, Judith Schrempf-Stirling

Management Faculty Publications

This case study discusses the economic, legal, and ethical considerations for conducting clinical trials in a controversial context. In 2010, pharmaceutical giant Roche received a shame award by the Swiss non-governmental organization Berne Declaration and Greenpeace for conducting clinical trials with organs taken from executed prisoners in China. The company respected local regulations and industry ethical standards. However, medical associations condemned organs from executed prisoners on moral grounds. Human rights organizations demanded that Roche ended its clinical trials in China immediately. Students are expected to review the economic and ethical issues regarding the outsourcing of clinical trials to controversial human …

Slavery Is Bad For Business: Analyzing The Impact Of Slavery On National Economies, Monti Narayan Datta, Kevin Bales

Political Science Faculty Publications

This article, using a novel dataset, demonstrates that slavery is empirically bad for business. Building upon the work of Robert Smith, the authors analysis examines the relationship between the prevalence of slavery in a country (in terms of the proportion of the population enslaved) and several economic measures (the United Nations Human Development Index, growth domestic product in terms of purchasing power parity, access to financial services, and the Gini coefficient). In each instance, controlling for alternative explanations, greater levels of slavery are associated with a decline in economic growth and human development. The findings imply that beyond the morality …

Ever Expanding Responsibilities: Upstream And Downstream Corporate Social Responsibility, Judith Schrempf-Stirling, Guido Palazzo, Robert A. Phillips

Management Faculty Publications

The debate on corporate social responsibility (CSR) has been on the public and academic agenda for several decades. In general, CSR issues can be divided into production-related issues (along the supply chain - or how things are made) and consumption-related issues (towards the consumer and society at large - or how things are used). Following the terminology of Phillips and Caldwell, upstream CSR refers to the CSR debate along the supply chain, and downstream CSR refers to corporate responsibility towards consumers and society at large. The chapter examines current CSR issues, and proposes a social connection model to …

Do Employers Have Obligations To Pay Their Workers A Living Wage?, Javier S. Hidalgo

Jepson School of Leadership Studies articles, book chapters and other publications

Jeremy Snyder argues that employers have obligations to pay their workers a living wage if workers stand in relationships of dependence with their employers. I argue that Snyder’s argument for this conclusion faces a dilemma. Snyder can adopt either a descriptive or a moralized account of dependence. If Snyder adopts a descriptive account, then it is false that dependence activates obligations to pay a living wage. If Snyder endorses a moralized account of dependence, then Snyder’s argument is circular. So, Snyder’s argument fails to establish that employers have obligations to pay their workers a living wage.

The Delimitation Of Corporate Social Responsibility: Upstream, Downstream, And Historic Csr, Judith Schrempf-Stirling

Management Faculty Publications

The dissertation abstract and the reflection commentary present the work of Judith Schrempf. The dissertation examines the latest trends in corporate social responsibility (CSR) and advances a social connection approach to CSR to understand and explain those recent trends. The dissertation abstract provides an overview of the research questions and conclusions of the three-article dissertation. The reflection commentary discusses the author’s views of research process as a junior scholar (see Appendix).

Ever Expanding Responsibilities: Upstream And Downstream Corporate Social Responsibility, Judith Schrempf-Stirling, Guido Palazzo, Robert A. Phillips

Management Faculty Publications

The debate on corporate social responsibility (CSR) has been on the public and academic agenda for several decades. In general, CSR issues can be divided into production-related issues (along the supply chain - or how things are made) and consumption-related issues (towards the consumer and society at large - or how things are used). Following the terminology of Phillips and Caldweli, Z upstream CSR refers to the CSR debate along the supply chain, and downstream CSR refers to corporate responsibility towards consumers and society at large. The chapter examines current CSR issues, and proposes a social connection model to understand …

Worthy Work And Bowie's Kantian Theory Of Meaningful Work, Joanne B. Ciulla

Jepson School of Leadership Studies articles, book chapters and other publications

Over the years, Norman E. Bowie has applied Kant’s ethics to several aspects of business ethics, but the one that I find the most compelling is his Kantian theory of meaningful work. He writes about it in his book Business Ethics: A Kantian Perspective (1999) and in an article ‘A Kantian theory of meaningful work’ (1998a). Bowie’s writing in this area demonstrates how Kant, perhaps more than any other philosopher, offers the most stringent and lucid account of what a moral employer/employee relationship should look like. Kantian ethics also provide Bowie with a foundation for explaining his idea of meaningful …

Nokia Siemens Networks: Just Doing Business – Or Supporting An Oppressive Regime?, Judith Schrempf-Stirling

Management Faculty Publications

This case study examines the relevance of taking social and political factors into consideration when a corporation is making a key business decision. In September 2009, Simon Beresford-Wylie, the outgoing CEO of Nokia Siemens Networks (NSN), was reviewing the company’s achievements — while acknowledging the latest public criticism regarding NSN’s business relationship with the Iranian government. In the summer of 2009, NSN was accused of complicity in human rights violations linked to Iran’s presidential election. The company sold network infrastructure and software solutions to the Iranian government, which then used this technology to observe, block, and control domestic communications. Should …

Mixed Agendas And Government Regulation Of Business: Can We Clean Up The Mess?, Tom Arnold, Jerry L. Stevens

Finance Faculty Publications

The history of regulation in the U.S. economy shows a cumulative growth of government involvement in private enterprise that has helped business at times and has been at odds with business at other times. The wavering views on how much regulation is warranted change over time and cut across political and philosophical ideologies. For example, in the first two years of President Barack Obama's administration there was a push for new and large increases in regulation of healthcare and financial markets along with intervention into public markets with massive spending to bailout automakers and financial institutions.

Now, in the second …

Le Développement Durable Comme Mode De Prévention Des Risques Energétiques : Une Approche Par Les Capacités D’Absorption. Le Cas De La Voiture Electrique Chez Renault, Sylvaine Castellano, Adnane Maâlaoui, Judith Schrempf-Stirling

Management Faculty Publications

Sustainability — a way to prevent energy-related risks — is the buzzword of the last decade. This trend demands radical rethinking on how society lives, consumes and produces. Herein, we focus on electric cars, which is the result of sustainable processes and initiatives in the car industry. The case of Renault illustrates how the firm based its sustainable strategy on its absorptive capacities.

Stakeholder Theory In Strategic Management: A Retrospective, Jeffrey S. Harrison

Management Faculty Publications

This chapter will provide a description of the personal journey of the author who, as a newly graduated Ph.D. in strategic management in 1985, embraced stakeholder theory. Perhaps one of the interesting aspects of this narrative is that the field of strategic management itself was in its infancy at the time of my graduation. So I have “grown up” in the strategy field while simultaneously observing and to some extent participating in the development of what we now call stakeholder theory. Over the past two and a half decades I have frequently found myself frustrated by my strategy colleagues’ lack …

When A Promotion Is Denied: The Effects Of Decision Stage On Perceptions Of Promotion And Price Fairness, Monika Kukar-Kinney, Lan Xia, Kent B. Monroe

Marketing Faculty Publications

Marketers frequently use promotions to enhance sales and increase consumers' perceptions of value. However, most promotions usually come with restrictions, such as time expiration, quantity or product model restriction, etc. In the present research, the effect of the stage in the purchase process when the consumer finds out about the restriction is investigated. The findings indicate that the later in the purchase process the consumer discovers the restriction, the greater is the perception that the effort invested into the purchase is wasted, consequently resulting in lower promotion and price fairness. This effect is mediated through the feeling of entitlement to …

Appearances Are Important: Outsourced Internal Audit Services And The Perception Of Auditor Independence, Marshall A. Geiger, D. Jordan Lowe, Kurt J. Pany

Accounting Faculty Publications

The appearance of independence is an important facet of the regulation of auditor independence. The authors conducted a research study to gauge how some financial statement users—loan officers—view and make decisions based on loan proposals that present various types of relationships between the applicant, the auditor that performs the external audit, and the auditor that performs the internal audit function (whether performed in-house or outsourced to the hypothetical loan applicant's external auditor).

The results are insightful: The closer the relationship between the external auditor and the audit client, the higher the perception of inappropriateness, and the less likely the loan …

The Bite Could Be Out Of Noncompete Clauses, Porcher L. Taylor Iii

School of Professional and Continuing Studies Faculty Publications

While Virginia is generally a pro-business state, the courts do not favor employee noncompete agreements because they are restraints of trade.

Government Must Make Consequences Clear, Porcher L. Taylor Iii

School of Professional and Continuing Studies Faculty Publications

With false-profits mania reigning supreme on Wall Street, Congress needs to establish an academy of corporate responsibility and integrity under the Securities and Exchange Commission. This executive training center would have as students the chief executives and financial officers and boards of directors of the nation’s publicly held companies. Senior partners at accounting companies need to be included in this back-to-school group, too. The enforcement-savvy teachers for this two-week academy would be lawyers and accountants from the commission and Justice Department.

The Marginal Cost Of Funds With Nonseparable Public Spending, Shaghil Ahmed, Dean D. Croushore

Economics Faculty Publications

This article provides new calculations of the welfare effects of fiscal changes when the publicly provided good is nonseparable in utility and production so that it affects economic agents' marginal decisions. The authors' results show that these nonseparabilities significantly alter the marginal cost of funds (MCF) that previous studies have calculated. The authors also report estimates of the nonseparable marginal benefits (NSMB) associated with aggregate government purchases. The net marginal cost offunds (NMCF ), which is equal to MCF - NSMB, is in general positive over a wide range of parameter values that encompass empirically relevant specifications. Thus the nonseparable …

Business Leadership And Moral Imagination In The Twenty-First Century, Joanne B. Ciulla

Jepson School of Leadership Studies articles, book chapters and other publications

My assignment in this year's series on "Moral Values: The Challenge of the Twenty-First Century" is to talk about moral values in a free society and the challenge for business leaders in the twenty-first century. My perspective on this topic is as a philosopher and educator. I also speak as a consultant who has developed corporate programs on ethics and leadership, primarily in the financial services industry. The focus of my presentation is on the issues that need to be addressed in order to educate the next generation of leaders.