Session 12

Effective Stakeholder Management

Track M

Date: Monday, October 8, 2012


Time: 13:30 – 14:45


Room: Meeting Room 2.2

Session Chair:

  • Wen Feng, MIT

Title: An Examination of the Impact of Executive Compensation Disparity on Stakeholder Management


  • Timothy Hart, University of Tulsa
  • Parthiban David, American University
  • Michelle Westermann-Behaylo, University of Amsterdam
  • Corey Fox, Missouri State University

Abstract: We investigate the relationship between compensation disparity within top management teams (TMT) and stakeholder management (SM). We argue that a large pay disparity between the CEO and the rest of the TMT undermines teamwork and cooperation amongst the TMT, which ultimately undermines SM. Initial findings from a sample of 938 firms from 1996-2005 show that compensation disparity is negatively associated with SM. However, we also find that this relationship is moderated by the visibility of firms. The negative association between pay disparity and SM is mitigated in larger firms, but heightened in smaller firms, suggesting that increased visibility and concomitant scrutiny from stakeholders in larger firms is beneficial for SM.

Title: Strategy and Supply Chain Sustainability: A Stakeholder Perspective


  • Patrice Luoma, Quinnipiac University
  • Mary Meixell, Quinnipiac University

Abstract: Supply chain management has emerged as a focal point for firms to incorporate sustainability and triple bottom line performance into their decision making processes. It is becoming increasingly evident that supply chain management initiatives are most effective when integrated with the firm’s strategy, and receive careful scrutiny from top level managers. The firm’s stakeholders play an important role in either facilitating or hindering this aspect of effective supply chain management. This research investigates the degree to which stakeholder theory helps to explain and to predict the implementation of sustainability practices in managing the supply chain. This research will make an important contribution to the strategic management literature by developing insight into the processes by which stakeholders are integrated into strategic supply chain decision making.

Title: The Attention-Based View of Stakeholder Theory: Integrating Automatic Processing to the Asset Allocation Process


  • Jonathan Raelin, George Washington University
  • Richard Klimoski, George Mason University

Abstract: This paper explains why asset allocation often differs from stakeholder theory’s quasi-rational predictions. While we agree that managers lack time to rationally assess all stakeholders’ demands, stakeholder interests are also not met due to “attentional forces”. Consequently, incorporating ideas from an attention-based view of the firm (ABV) has great merit. Our first contribution is to integrate key aspects of both literatures. We then explain why an augmented quasi-rational approach may not be sufficient for a robust stakeholder theory. Our second contribution is to add automatic information processing to the ABV of stakeholder theory. We propose an ABV of stakeholder theory informed by micro-foundations of automatic decision-making. Sunk-cost bias is then used to exemplify counter-rational managerial tendencies when making asset allocation decisions in a multi-stakeholder context.

Title: Understanding the Impacts of Indirect Stakeholder Relationships: Stakeholder Value Network Analysis and Its Application to Large Engineering Projects


  • Wen Feng, MIT
  • Edward Crawley, MIT
  • Olivier de Weck, MIT
  • Donald Lessard, MIT

Abstract: In order to understand the strategic implications of indirect stakeholder relationships on large engineering projects, this research develops a qualitative/quantitative network approach, namely the Stakeholder Value Network analysis, to model the multiple relationships between stakeholders as value exchanges. With the theoretical support from Social Exchange Theory, this approach unifies both social and economic relationships into a common framework and also defines network statistics to effectively measure indirect stakeholder influence in a "Network" model as against a more traditional "Hub-and-Spoke" model. The usefulness of this approach and the strategic implications of those network statistics are then demonstrated by a retrospective case study for a real large engineering project, with improved understandings of relationships management for various stakeholders.

All Sessions in Track M...

Sun: 08:00 – 09:15
Session 126: Entrepreneurship & Stakeholders - The Future Research Agenda
Sun: 11:15 – 12:30
Session 276: Performance Measurement Tools: A Review of Progress
Mon: 08:00 – 09:15
Session 106: Why do Firms do Bad Things and What Do We Know about It?
Mon: 09:30 – 10:45
Session 15: Human Factors in Stakeholder Strategy
Mon: 13:30 – 14:45
Session 12: Effective Stakeholder Management
Session 138: Value Creation & Appropriation: Take the money and run
Mon: 16:30 – 17:45
Session 113: Large Shareholders are Doing it for Themselves
Tue: 08:00 – 09:15
Session 11: Stakeholders and Corporate Social Performance
Tue: 11:00 – 12:15
Session 117: Heterogeneous Owner Types and their Influence
Tue: 14:15 – 15:30
Session 182: Challenges for Stakeholder Management
Tue: 15:45 – 17:00
Session 10: Stakeholders and Crisis Performance
Tue: 17:30 – 18:45
Session 13: The Problem of Performance in the Theory of the Firm:

Strategic Management Society