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Toward a Stakeholder Theory of the Firm: The Saturn Partnership

Author

Listed:
  • Thomas A. Kochan

    (Sloan School of Management, Massachusetts Institute of Technology, 50 Memorial Drive, Cambridge, Massachusetts 02142)

  • Saul A. Rubinstein

    (School of Management and Labor Relations, Rutgers University, 50 Labor Center Way, New Brunswick, New Jersey 08903)

Abstract

This paper seeks to engage the organization theory community in contemporary debates over the role of the corporation in American society by using the case of the Saturn corporation to develop and illustrate a stakeholder theory of the firm. One normative and three positive questions are posed for a stakeholder theory: The normative question is: Why should stakeholder models be given serious consideration at this moment in history? The positive questions are: (1) Under what conditions is a stakeholder firm likely to emerge in the United States, (2) what are the critical determinants of performance in a stakeholder firm, and (3) what will determine the sustainability and diffusion of this organizational form in the American environment? The history, design features, and dynamics of the labormanagement partnership at Saturn are used to illustrate and interpret a specific case of employees as stakeholders. Saturn's original mission, governance structure, and internal processes fit the characteristics of a stakeholder firm. Employees establish themselves as influential, definitive stakeholders by using their knowledge to improve organizational performance. The local union likewise contributes to firm performance by organizing workers into a dense social network that contributes to problem solving, conflict resolution, and quality improvement. However, the legal and political environment in which the firm operates produces considerable uncertainty over the sustainability and diffusion of Saturn's features in particular, and the stakeholder organizational form in general. Additional hypotheses and research questions are proposed to continue theory building around the more general model of the stakeholder firm. Researchers are encouraged to take up the analysis of stakeholder models and thereby contribute to the contemporary and future debates over the role of the corporation in American society.

Suggested Citation

  • Thomas A. Kochan & Saul A. Rubinstein, 2000. "Toward a Stakeholder Theory of the Firm: The Saturn Partnership," Organization Science, INFORMS, vol. 11(4), pages 367-386, August.
    • Handle: RePEc:inm:ororsc:v:11:y:2000:i:4:p:367-386
    DOI: 10.1287/orsc.11.4.367.14601
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    References listed on IDEAS

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    2. Helin, Sven & Jensen, Tommy & Sandström, Johan, 2013. "“Like a battalion of tanks”: A critical analysis of stakeholder management," Scandinavian Journal of Management, Elsevier, vol. 29(3), pages 209-218.
    3. Aspers, Patrik, 2009. "How are markets made?," MPIfG Working Paper 09/2, Max Planck Institute for the Study of Societies.
    4. Siebold, Nicole & Oelrich, Sebastian & Roche, Olivier P., 2023. "“I Am Your Partner, Am I Not?” An inquiry into stakeholder inclusion in platform organizations in times of crisis," Journal of Business Research, Elsevier, vol. 160(C).
    5. Fali Huang & Peter Cappelli, 2006. "Employee Screening: Theory and Evidence," NBER Working Papers 12071, National Bureau of Economic Research, Inc.
    6. Carlos Ferro-Soto & Luz Amparo Macías-Quintana & Paula Vázquez-Rodríguez, 2018. "Effect of Stakeholders-Oriented Behavior on the Performance of Sustainable Business," Sustainability, MDPI, vol. 10(12), pages 1-27, December.
    7. Nudurupati, Sai Sudhakar & Bhattacharya, Arijit & Lascelles, David & Caton, Nicholas, 2015. "Strategic sourcing with multi-stakeholders through value co-creation: An evidence from global health care company," International Journal of Production Economics, Elsevier, vol. 166(C), pages 248-257.
    8. Viveros, Hector, 2017. "Unpacking stakeholder mechanisms to influence corporate social responsibility in the mining sector," Resources Policy, Elsevier, vol. 51(C), pages 1-12.
    9. Youness Frichi & Fouad Jawab & Said Boutahari, 2019. "The Mixed-Method 5W2D Approach for Health System Stakeholders Analysis in Quality of Care: An Application to the Moroccan Context," IJERPH, MDPI, vol. 16(16), pages 1-25, August.
    10. Berger, Hilary & Lewis, Clare, 2011. "Stakeholder analysis is key to client–supplier relationships of global outsourcing project success," International Journal of Information Management, Elsevier, vol. 31(5), pages 480-485.
    11. Mauro Sciarelli & Mario Tani & Giovanni Landi & Ornella Papaluca, 2019. "The Impact of Social Responsibility Disclosure on Corporate Financial Health: Evidences from Some Italian Public Companies," International Business Research, Canadian Center of Science and Education, vol. 12(3), pages 109-122, March.
    12. Mühlbacher, Hans & Böbel, Ingo, 2019. "From zero-sum to win-win - Organisational conditions for successful shared value strategy implementation," European Management Journal, Elsevier, vol. 37(3), pages 313-324.

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