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Stakeholder Relationships, Engagement, and Sustainability Reporting

Author

Listed:
  • Irene M. Herremans

    (University of Calgary)

  • Jamal A. Nazari

    (Simon Fraser University)

  • Fereshteh Mahmoudian

    (University of Calgary
    Simon Fraser University)

Abstract

The concept of sustainability was developed in response to stakeholder demands. One of the key mechanisms for engaging stakeholders is sustainability disclosure, often in the form of a report. Yet, how reporting is used to engage stakeholders is understudied. Using resource dependence and stakeholder theories, we investigate how companies within the same industry address different dependencies on stakeholders for economic, natural environment, and social resources and thus engage stakeholders accordingly. To achieve this objective, we conducted our research using qualitative research methods. Our findings suggest that the resource dependencies on different stakeholders lead to development of different stakeholder relationships and thus appropriate resources within the company to execute engagement strategies that are informing, responding, or involving. Our research explains why diversity exists in sustainability disclosure by studying how it is used to engage stakeholders. We find that five sustainability reporting characteristics are associated with the company’s stakeholder engagement strategy: directness of communication, clarity of stakeholder identity, deliberateness of collecting feedback, broadness of stakeholder inclusiveness, and utilization of stakeholder engagement for learning. Our study develops the literature by providing insight into companies’ choices of stakeholder engagement strategy thus explaining diversity in sustainability reporting based on the characteristics and relationships with specific stakeholders.

Suggested Citation

  • Irene M. Herremans & Jamal A. Nazari & Fereshteh Mahmoudian, 2016. "Stakeholder Relationships, Engagement, and Sustainability Reporting," Journal of Business Ethics, Springer, vol. 138(3), pages 417-435, October.
  • Handle: RePEc:kap:jbuset:v:138:y:2016:i:3:d:10.1007_s10551-015-2634-0
    DOI: 10.1007/s10551-015-2634-0
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