IDEAS home Printed from https://ideas.repec.org/a/gam/jjrfmx/v18y2025i2p59-d1578756.html
   My bibliography  Save this article

The Call to Shift from the Narrow Legalistic to the Broader Moral and Legal Stakeholder Model in Indonesian State-Owned Enterprises: Its Implications and Challenges

Author

Listed:
  • Yafet Yosafet Wilben Rissy

    (Faculty of Law, Satya Wacana Christian University, Salatiga 50711, Indonesia)

Abstract

This article aims to elaborate on the narrow legalistic stakeholder model and the need to apply a new revised moral and legal stakeholder model in Indonesian state-owned enterprises (SOEs) with its implications and challenges. Studies on the narrow legalistic stakeholder model in Indonesian SOEs are still uncommon, despite the rising awareness of the model. This study expects to initiate discourse on the ideal stakeholder model in the industry. This study combined doctrinal and empirical legal research methods. The SOE laws and the Minister of SOEs’ regulations were examined aside from the investigation of empirical data on the accusation of SOEs breaching their obligations to their legitimate stakeholders as indicated in court decisions and mass media publications. This study shows that the Minister of SOEs’ Regulation on Implementing Corporate Governance Implementation has promoted a narrow legalistic approach to the stakeholder model. As a result, only those who have a written contract with SOEs can be considered as the legitimate direct stakeholders. This approach has led to the expropriation of other indirect legitimate stakeholders of the SOEs. This study can be used to revise the narrow legalistic stakeholder model and to strengthen research on the stakeholder model in SOEs and corporate governance.

Suggested Citation

  • Yafet Yosafet Wilben Rissy, 2025. "The Call to Shift from the Narrow Legalistic to the Broader Moral and Legal Stakeholder Model in Indonesian State-Owned Enterprises: Its Implications and Challenges," JRFM, MDPI, vol. 18(2), pages 1-15, January.
    • Handle: RePEc:gam:jjrfmx:v:18:y:2025:i:2:p:59-:d:1578756
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1911-8074/18/2/59/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1911-8074/18/2/59/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Anant K. Sundaram & Andrew C. Inkpen, 2004. "The Corporate Objective Revisited," Organization Science, INFORMS, vol. 15(3), pages 350-363, June.
    2. Steven Radelet & Jeffrey Sachs, 2000. "The Onset of the East Asian Financial Crisis," NBER Chapters, in: Currency Crises, pages 105-153, National Bureau of Economic Research, Inc.
    3. Nur Sayidah & Aminullah Assagaf & Bayu Taufiq Possumah, 2019. "Determinant of state-owned enterprises financial health: Indonesia empirical evidence," Cogent Business & Management, Taylor & Francis Journals, vol. 6(1), pages 1600207-160, January.
    4. Tracey E. George & Albert H. Yoon, 2014. "The Labor Market for New Law Professors," Journal of Empirical Legal Studies, John Wiley & Sons, vol. 11(1), pages 1-38, March.
    5. Phillips, Robert, 2003. "Stakeholder Legitimacy," Business Ethics Quarterly, Cambridge University Press, vol. 13(1), pages 25-41, January.
    6. Phillips, Robert & Freeman, R. Edward & Wicks, Andrew C., 2003. "What Stakeholder Theory is Not," Business Ethics Quarterly, Cambridge University Press, vol. 13(4), pages 479-502, October.
    7. Dunfee, Thomas W. & Donaldson, Thomas, 1995. "Contractarian Business Ethics: Current Status and Next Steps," Business Ethics Quarterly, Cambridge University Press, vol. 5(2), pages 173-186, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yafet Yosafet Wilben Rissy, 2021. "The stakeholder model: its relevance, concept, and application in the Indonesian banking sector," Journal of Banking Regulation, Palgrave Macmillan, vol. 22(3), pages 219-231, September.
    2. Allen Kaufman & Ernie Englander, 2011. "Behavioral Economics, Federalism, and the Triumph of Stakeholder Theory," Journal of Business Ethics, Springer, vol. 102(3), pages 421-438, September.
    3. Samantha Miles, 2017. "Stakeholder Theory Classification: A Theoretical and Empirical Evaluation of Definitions," Journal of Business Ethics, Springer, vol. 142(3), pages 437-459, May.
    4. James Hine & Lutz Preuss, 2009. "“Society is Out There, Organisation is in Here”: On the Perceptions of Corporate Social Responsibility Held by Different Managerial Groups," Journal of Business Ethics, Springer, vol. 88(2), pages 381-393, August.
    5. Elise Perrault, 2017. "A ‘Names-and-Faces Approach’ to Stakeholder Identification and Salience: A Matter of Status," Journal of Business Ethics, Springer, vol. 146(1), pages 25-38, November.
    6. Pamela Queen, 2015. "Enlightened Shareholder Maximization: Is this Strategy Achievable?," Journal of Business Ethics, Springer, vol. 127(3), pages 683-694, March.
    7. Yves Fassin, 2010. "A Dynamic Perspective in Freeman’s Stakeholder Model," Journal of Business Ethics, Springer, vol. 96(1), pages 39-49, August.
    8. Mollie Painter-Morland, 2006. "Redefining Accountability As Relational Responsiveness," Journal of Business Ethics, Springer, vol. 66(1), pages 89-98, June.
    9. David Rönnegard & N. Craig Smith, 2024. "A Rawlsian Rule for Corporate Governance," Journal of Business Ethics, Springer, vol. 190(2), pages 295-308, March.
    10. Bongani Munkuli & Renee Horne, 2018. "Financial Markets Value Reputation for Corporate Social Responsibility (CSR) – A Study of the South African Mining Sector," Africagrowth Agenda, Africagrowth Institute, vol. 15(2), pages 17-22.
    11. Liliana Hawrysz & Jolanta Maj, 2017. "Identification of Stakeholders of Public Interest Organisations," Sustainability, MDPI, vol. 9(9), pages 1-13, September.
    12. Sefa Hayibor, 2017. "Is Fair Treatment Enough? Augmenting the Fairness-Based Perspective on Stakeholder Behaviour," Journal of Business Ethics, Springer, vol. 140(1), pages 43-64, January.
    13. Yves Fassin, 2012. "Stakeholder Management, Reciprocity and Stakeholder Responsibility," Journal of Business Ethics, Springer, vol. 109(1), pages 83-96, August.
    14. Y. Fassin, 2008. "The Stakeholder Model Refined," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 08/529, Ghent University, Faculty of Economics and Business Administration.
    15. R. Edward Freeman & Andrew C. Wicks & Bidhan Parmar, 2004. "Stakeholder Theory and “The Corporate Objective Revisited”," Organization Science, INFORMS, vol. 15(3), pages 364-369, June.
    16. Garrod, Brian & Fyall, Alan & Leask, Anna & Reid, Elaine, 2012. "Engaging residents as stakeholders of the visitor attraction," Tourism Management, Elsevier, vol. 33(5), pages 1159-1173.
    17. Johannes Jahn & Rolf Brühl, 2018. "How Friedman’s View on Individual Freedom Relates to Stakeholder Theory and Social Contract Theory," Journal of Business Ethics, Springer, vol. 153(1), pages 41-52, November.
    18. Michael A. Witt & Günter K. Stahl, 2016. "Foundations of Responsible Leadership: Asian Versus Western Executive Responsibility Orientations Toward Key Stakeholders," Journal of Business Ethics, Springer, vol. 136(3), pages 623-638, July.
    19. Dirk Matten & Guido Palazzo, 2008. "Unternehmensethik als Gegenstand betriebswirtschaftlicher Forschung und Lehre–Eine Bestandsaufnahme aus internationaler Perspektive," Schmalenbach Journal of Business Research, Springer, vol. 60(58), pages 50-71, January.
    20. Baudot, Lisa & Dillard, Jesse & Pencle, Nadra, 2020. "The emergence of benefit corporations: A cautionary tale," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 67.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jjrfmx:v:18:y:2025:i:2:p:59-:d:1578756. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.