Nonprofit Organizations and Corporate Responsibility E-Book

Nicholas A. Arnold

• Herausgeber: Books on Demand
• Kategorie: Fachliteratur
• Serie: CEPS PhD Series
• Sprache: Englisch

Seitenzahl: 204

Veröffentlichungsjahr: 2023

Beschreibung

Within three individual essays, this thesis deals with collaborative and confrontational approaches by NPOs towards companies, and the role these play with respect to corporate responsibility. By drawing on social movement theory, nonprofit-business collaboration literature as well as legitimacy theory, it advances our knowledge regarding two topics: First, this thesis provides answers to the question how successful collaborative and confrontational approaches are individually at influencing households' judgements of companies and of NPOs themselves. Second, it extends our knowledge of interactions between these approaches. With respect to individual effects, this thesis demonstrates that both collaborative and confrontational approaches by NPOs exert a significant effect on households' legitimacy evaluations of companies and subsequently their consumption intentions. Legitimacy also appears as important underlying factor influencing households' support for NPOs, with collaborative NPOs enjoying higher legitimacy and thus support from households than confrontational ones. Concerning interactions between these two types of approaches, this thesis finds confirmation for previous suggestions that contrasting NPO approaches interplay - but demonstrates that such interactions clearly present a double-edged sword. By simultaneously focusing their approach on the same company, both types of NPO suffer a loss in their ability to influence households' perceptions of companies in the way they envision as well as their capability of attaining resources. However, if such approaches are applied sequentially, the picture of these interaction-effects become more positive. These results indicate that NPOs with different approaches towards companies are well advised to work together in a strategic manner in order to maximize their success.

Leseprobe

Abstract

Within three individual essays, this thesis deals with collaborative and confrontational approaches by NPOs towards companies, and the role these play with respect to corporate responsibility. By drawing on social movement theory, nonprofit-business collaboration literature as well as legitimacy theory, it advances our knowledge regarding two topics: First, this thesis provides answers to the question how successful collaborative and confrontational approaches are individually at influencing households’ judgements of companies and of NPOs themselves. Second, it extends our knowledge of interactions between these approaches. With respect to individual effects, this thesis demonstrates that both collaborative and confrontational approaches by NPOs exert a significant effect on households’ legitimacy evaluations of companies and subsequently their consumption intentions. Legitimacy also appears as important underlying factor influencing households’ support for NPOs, with collaborative NPOs enjoying higher legitimacy and thus support from households than confrontational ones. Concerning interactions between these two types of approaches, this thesis finds confirmation for previous suggestions that contrasting NPO approaches interplay – but demonstrates that such interactions clearly present a double-edged sword. By simultaneously focusing their approach on the same company, both types of NPO suffer a loss in their ability to influence households’ perceptions of companies in the way they envision as well as their capability of attaining resources. However, if such approaches are applied sequentially, the picture of these interaction-effects becomes more positive. These results indicate that NPOs with different approaches towards companies are well advised to work together in a strategic manner in order to maximize their success.

TABLE OF CONTENTS

ACKNOWLEDGMENT

INTRODUCTION

Relevance and Research Questions

From Individual to Interaction-Effects

Indirect Effects: NPOs and Households

Theoretical Underpinnings

Individual NPO Approaches, Corporate Responsibility and NPO Resources

Beyond the Dyadic: Interaction-Effects Between Different NPO Approaches

Research Approach and Process

Research Output

Critical Assessment

Main Contribution I: Indirect Pathways of Influence – Effects and Underlying Mechanisms

Main Contribution II: Interactions Between Collaborative and Confrontational Approaches

Limitations

Implications

References

ESSAY ONE

ESSAY ONE – EXTENSIONS

ESSAY TWO

ESSAY THREE

APPENDIX: EXPERIMENTAL DESIGN

ACKNOWLEDGMENT

Writing a thesis is undoubtedly not a sprint, but a marathon, and it would have been inconceivable to reach the finishing line without the people around me, who helped me achieve many a runner’s high and overcome the occasional runner’s low.

First of all, I want to express my gratitude to my supervisor Prof. Dr. Georg von Schnurbein. He not only granted me the opportunity to pursue my PhD studies, but was of utmost support in introducing me to, and helping me navigate the scientific arena. Of course, in countless meetings and discussions throughout the past four years, his knowledge of the nonprofit sector and the issue of corporate responsibility, his technical and tactical guidance, and his encouragement were of invaluable support in the process of constantly driving forward my thesis. I also want to extend my gratitude to my co-supervisor, Prof. Dr. Miguel Brendl, for critically-constructively challenging my work – especially for offering technical guidance with respect to designing the experiment that constitutes a central element of my thesis. I would also like to thank my fellow nonprofit researchers and numerous anonymous reviewers, who at scientific conferences, and in the review processes that my essays went through, provided helpful inputs and criticism. Of course, Jeff Brudney, who sadly and unexpectedly passed away in April 2021, will always remain in very fond memory. With his abundance of kindness and his immeasurable knowledge of the nonprofit sector and the scientific arena, he greatly assisted me in developing my work. Dear Jeff, you are greatly missed!

Naturally, a big thank you goes out to my fellow runners: all team members at the Center for Philanthropy Studies (CEPS) at the University of Basel, who created such an enjoyable and conducive atmosphere, and always kept me motivated to continue working on my thesis. Naturally, my work would be far less developed without their invaluable inputs and feedbacks. The team’s support, and the many great moments we shared over the past years remain unforgettable.

Of course, I cannot thank my family and friends enough for their support in the course of my PhD studies, without which I couldn’t have brought my thesis over the finishing line. Most of all, I want to thank my wife Kari for putting up with an at times absent-minded husband during these four years, for helping out in so many different ways, for always providing me with words of encouragement – and simply for being the lovely and loving person and wife you are. And thank you to my little fellow, Liam, for enriching my life in ways that cannot be put in words, and giving me those smiles that – while making it hard to leave your side – were always of such great motivation to get back to reading, thinking, and writing. Last but not least, a big thank you to my parents, my brother, and the great friends I can count on, for all your support, for lending me your ear, for taking an interest in my project – and simply for always being there for me.

INTRODUCTION

Be it while browsing the contents of news outlets, following political discussions, doing grocery shopping at the supermarket, or walking advertisement-plastered streets – the topic of corporate responsibility appears omnipresent. In this context, coming across the names and logos of nonprofit organizations (NPOs) is far from uncommon. NPOs appear as certifiers of company products, as partners of companies in the development of corporate responsibility practices, or as participants in multi-stakeholder initiatives. NPOs also publicly scandalize company practices by leading campaigns and organizing protests against companies, or seek litigation. These examples serve to show three things: first, attempting to influence corporate responsibility is high on the agenda of many NPOs; second, in doing so, some NPOs rely on collaborative approaches, while others resort to confrontational ones; and third, influencing public perceptions regarding companies is an important pathway chosen by NPOs, as they frequently attempt to speak to households in their double role as consumers and donors in order to influence corporate conduct and attain resources.

But, how successful are NPOs in influencing the public’s perception of companies and of themselves, and what mechanism might be underlying this? And how do collaborative and confrontational NPO approaches interact with respect to affecting corporate responsibility practices and NPO resources? These questions take center stage within this thesis. My main motivation thereby is overcoming the bifurcation within academic scholarship on NPOs’ approaches towards companies regarding the issue of corporate responsibility – that is the investigation of collaborative approaches and their effects here, and the exploration of confrontational approaches and their outcomes there.

To put the three essays constituting this thesis into context, in this introductory part I first highlight the relevance of and my motivation for investigating the topic at hand, and present my research questions. Thereafter, I provide a short overview of the academic literature underlying and tying together the three essays. I then briefly sketch the research process and central output of this thesis. Finally, I present the central findings resulting from my research, and discuss its implications as well as its limitations.

Relevance and Research Questions

Societal expectations towards companies to consider the social and environmental implications of their activities have increased throughout the past decades (Austin & Seitanidi, 2012a). This is not least the result of activities by NPOs, who, in the light of the growing economic and political power of companies, and the decreasing ability and willingness of nation states to regulate latter (Campbell, 2007; King & Pearce, 2010; Utting, 2005), have increasingly started focusing directly on companies in their attempts to influence corporate responsibility. Both collaborative and confrontational approaches by NPOs towards companies have been on the rise (Arenas et al., 2013; De Bakker, 2012; Soule, 2009), and both are ascribed an important role in ‘defining, shaping, and measuring the social responsibilities’ of companies (Den Hond et al., 2015, 188). In fact, a range of scholars argue that companies nowadays can hardly get around paying attention to NPOs, as latter have gained an increasingly influential role with respect to the topic of corporate responsibility (Burchell & Cook, 2013).

Nevertheless, scholarship around the issue of corporate responsibility has largely focused on the company perspective, while the viewpoint of NPOs has remained under-examined (Harris, 2012). Moreover, where the NPO perspective has been considered, scholarship has generally investigated the implications of collaborative and confrontational NPO approaches towards companies separately, giving rise to calls for research combining these individual strands of literature (Briscoe & Gupta, 2016; Den Hond et al., 2010; Kourula & Laasonen, 2010; Soule, 2018). Consequently, in this thesis I focus on the role of NPOs surrounding the issue of corporate responsibility – and most importantly, on the way in which collaborative and confrontational approaches by NPOs towards companies interact in this regard.

From Individual to Interaction-Effects

By means of confrontational approaches towards companies, NPOs have arguably played an important role in raising public awareness concerning corporate responsibility, and in moving companies to pay (more) attention to and ratchet-up their corporate responsibility practices (Burchell & Cook, 2013; Den Hond et al., 2015; King & Pearce, 2010; Kneip, 2013; Utting, 2005). At the same time, NPOs are ascribed an important function as companions of companies in the area of corporate responsibility, for example by acting as certifiers of company products, or by providing companies with the necessary expertise for the implementation of corporate responsibility practices (Arenas et al., 2013; Austin & Seitanidi, 2012a; Selsky & Parker, 2005).

In effect, both collaborative and confrontational approaches by NPOs towards companies with the aim to affect corporate responsibility are widespread – and individual NPOs appear to increasingly specialize on either of the two approaches (Austin & Seitanidi, 2012a; Bertels et al., 2014; Valor & Merino de Diego, 2009). Therefore, it comes as little surprise that scholarly investigation of these two types of approaches individually has increased. However, while such research is important, the fact that the strands of literature dealing with collaborative and confrontational approaches by NPOs towards companies respectively have remained rather detached from one another, has led to one important question remaining under-examined: namely, how these two differing NPO approaches towards companies affect one another. If collaborative approaches by NPOs support companies in successfully implementing corporate responsibility practices, and reaping benefits from this, how does this affect outcomes for more confrontational NPOs with respect to influencing corporate conduct? Conversely, how does the presence of confrontational NPOs affect more collaborative NPOs’ ability to successfully influence corporate behavior? And what does the simultaneous presence of both types of approaches imply in terms of NPOs’ capacity to attain the public support necessary for reaching their objectives? Searching answers to these questions lies at the heart of this thesis, in line with calls for a closer investigation of the way, in which NPOs with differing approaches towards companies interact and affect one another both with respect to their ability to influence corporate responsibility and their capacity to attain resources (Arenas et al., 2013; Baron et al., 2016; Briscoe & Gupta, 2016; Den Hond & De Bakker, 2007; Soule, 2018).

Indirect Effects: NPOs and Households

Despite their growing importance in the area of corporate responsibility, NPOs are considered secondary stakeholders of companies, disposing over limited power to directly influence latter (Eesley et al., 2015; Holzer, 2006). As a consequence, NPOs frequently attempt to act via primary stakeholders of companies in order to influence corporate responsibility in the way they envision (Eesley & Lennox, 2006; King & Pearce, 2010).

One prominent key stakeholder of companies that NPOs target are households, since – in their role as consumers – households have the ability to influence corporate responsibility practices by purchasing from companies they evaluate positively, and abstaining from consuming products from companies they evaluate negatively (Copeland, 2014; Koos, 2012). In effect, both collaboratively as well as confrontationally oriented NPOs are ascribed an important function with respect to introducing issues surrounding corporate responsibility practices into the public realm, thereby shaping households’ evaluation of companies and their products (Auger et al., 2003; Balsiger, 2010; Clarke et al., 2007; Dubuisson-Quellier, 2015).

However, to what extent NPOs are, in fact, able to influence households’ consumption decisions has received limited attention (Austin & Seitanidi, 2012b; Balsiger, 2010; Yaziji & Doh, 2009). Most importantly, while it is argued that NPOs affect consumption decisions by influencing households’ legitimacy evaluations of companies (Austin & Seitanidi, 2012b; King, 2008), a thorough investigation of this mechanism is missing from academic literature. Furthermore, to what extent the approach towards companies chosen by NPOs influences their own legitimacy in the public eye, and by extension their ability to garner support from households remains largely unanswered (Balsiger, 2010; Dubuisson-Quellier, 2015; Herlin, 2015). More closely examining these issues is the second central aim that I pursue in this thesis.

Research Questions

Based on the research gaps indicated above, table 1 presents the research questions put forward within the three essays comprising this thesis, and indicates the aim and the type of research approach applied within the three individual essays.

Research Questions

Aim / Type

Essay 1

How do activities of collaborative NPOs support or hinder confrontational NPOs’ ability to influence corporate responsibility?

exploratory (qualitative)

Essay 2

To what extent do collaborative and confrontational NPO approaches affect households’ consumption decisions, and to what extent is this mediated by NPOs’ impact on households’ legitimacy evaluations of companies?

To what extent do collaborative and confrontational NPO approaches affect households’ donation decisions, and to what extent is this mediated by households’ legitimacy evaluations of NPOs?

explanatory (experimental)

Essay 3

How do collaborative and confrontational approaches by NPOs towards companies interact in affecting households’ purchasing and donation decisions?

explanatory (experimental)

Table 1: Research questions posed and type of research applied in the three essays comprising this thesis.

Theoretical Underpinnings

Interactions between companies and NPOs in the area of corporate responsibility have resulted in a diverse stream of research, which this thesis draws in order to find answers to the research questions posed (see figure 1).

Figure 1: Theoretical underpinnings and connections underlying the three essays comprising this thesis. Note: COM=company; NPO=nonprofit organization; CR=corporate responsibility

Most importantly, I resort to social movement theory, which offers important insights into how NPOs attempt to affect corporate responsibility by putting pressure on companies – both directly as well as indirectly via their influence on public opinion. Moreover, scholars in this area have discussed (potential) outcomes of contentious action on companies as well as on NPOs themselves (Burchell & Cook, 2013; De Bakker et al., 2013; Den Hond & De Bakker, 2007; King, 2008; Soule, 2009). Furthermore, with respect to the most central question posed in this thesis, that is how collaborative and confrontational approaches by NPOs interact, the concept of ‘flank effects’ (Haines, 1984) emanating from social movement theory is of central importance. Finally, social movement theory has influenced developments in the field of institutional change theory (Den Hond & De Bakker, 2007), on which I draw in essay one in order to investigate how differing NPO approaches impact one another with respect to their ability to change corporate conduct.

Second, I draw on the increasing body of research on nonprofit-business collaborations. This strand of literature offers valuable insights into how NPOs attempt to affect corporate responsibility by working directly with companies, as well as by influencing public opinion (Austin & Seitanidi, 2012a; Selsky & Parker, 2005). Furthermore, nonprofit-business collaboration literature delineates (potential) outcomes for collaboratively oriented NPOs in terms of affecting corporate responsibility and attaining resources.

Third, I apply insights from legitimacy theory, specifically its central argument that the legitimacy of an organization acts as important antecedent for its ability to attract resources and attain its objectives (Bitekine et al., 2020; Suchman, 1995). Nonprofit-business collaboration literature and social movement theory argue that collaborative and confrontational NPOs respectively have an important effect on the public’s legitimacy judgements of companies, and by extension companies’ ability to attract resources (Austin & Seitanidi, 2012a; King, 2008; Odziemkowska & McDonnell, 2019; Yaziji & Doh, 2009). Both literature strands also propose that the perceived legitimacy of the approach adopted by NPOs towards companies will influence NPOs’ capacity to attract support and fulfil their mission (AL-Tabbaa et al., 2014; Balsiger, 2010; Dubuisson-Quellier, 2015). Moreover, the aforementioned concept of flank effects puts forward the assumption that the simultaneous presence of collaborative and confrontational NPO approaches can affect the legitimacy of both types of NPOs as well as the companies they interact with, which by extension will influence these organizations’ ability to attract resources (Haines, 1984; Haines, 2013). Yet, these proposed effects remain under-examined, and legitimacy theory offers a valuable lens and validated scales for examining such potential effects. Specifically, in essays two and three of this thesis, I measure the impact of collaborative and confrontational NPO approaches on households’ socio-political legitimacy judgements of both companies and NPOs themselves. Socio-political legitimacy judgements evolve around the questions whether an organization is beneficial or hazardous to an individual, his or her social group, and broader society – that is whether the organization’s behavior makes it worthy of support or not (Bitekine, 2011).1

Individual NPO Approaches, Corporate Responsibility and NPO Resources

Both nonprofit-business collaboration literature as well as social movement theory list an array of market-focused and non-market focused approaches that NPOs have at their disposal to attempt to influence companies’ corporate responsibility practices (see table 2). On the collaborative side, they can, for example, engage in partnerships and joint projects, offer consulting services to companies, become involved with companies via certification or labelling initiatives, or praise companies by publishing positive company ratings (Austin & Seitanidi, 2012a; Den Hond & De Bakker, 2007; Utting, 2005; Winston, 2002). Confrontational approaches include, for example, critical campaigning to uncover and scandalize problematic company practices, the organization of protests and demonstrations, the use of negative company ratings, or litigation (Balsiger, 2010; 2018; Kneip, 2013; Soule, 2009; Utting, 2005; Winston, 2002; Yaziji & Doh, 2013).

NPO Approaches Towards Companies

focus on re-institutionalization

focus on de-institutionalization

symbolic gain

material gain

symbolic damage

material damage

market strategy

ratings (positive)

buycott calls (labels/ certificates)

ratings (negative)

boycott calls

non-market strategy

cooperation, partnerships

protests, petitions

blocking, sabotage, lawsuits

Table 2: Gain and damage approaches by NPOs towards companies (based on Den Hond & De Bakker, 2007)

By pursuing such varied approaches towards companies, NPOs are seen as relevant actors in shaping norms and practices of corporate responsibility (Austin & Seitanidi, 2012a; Avetisyan & Ferrary, 2012; Den Hond & De Bakker, 2007). Indeed, both types of NPO approaches appear to be capable of instigating changes in the area of corporate responsibility, as argued both by nonprofit-business collaboration literature (Austin & Seitanidi, 2012a; Arenas et al., 2013; Burchell & Cook, 2013; Herlin, 2015), and by social movement literature (Den Hond et al., 2015; Eesley & Lennox, 2006; King & Pearce, 2010; King & Soule, 2007; Soule, 2009).

The way, in which NPOs are involved in this process is usefully conceptualized in Den Hond and De Bakker’s (2007) framework that resorts to institutional change theory to describe ways by which NPOs attempt to impact corporate responsibility. They suggest that NPOs do so by seeking either de-institutionalization or re-institutionalization of corporate responsibility practices. De-institutionalization is about opposing existing institutional norms and practices. Re-institutionalization, in contrast, consists of working towards preferred alternative norms and practices. Affecting corporate conduct via de-institutionalization is the preferred path chosen by more confrontational NPOs, and involves the use of confrontational approaches described above, which aim at exerting material or symbolic damage upon companies to push them towards adapting their behavior. In contrast, collaborative NPOs focus on re-institutionalization in attempting to achieve changes in corporate behavior, i.e. they resort to approaches that offer companies symbolic and material gain (Den Hond & De Bakker, 2007; see table 2).

As aforementioned, an important way in which both collaborative and confrontational NPOs are argued to affect corporate responsibility is via their influence on households as primary stakeholders of companies (Austin & Seitanidi, 2012a; Balsiger, 2010; De Bakker et al., 2013; Dubuisson-Quellier, 2015; Holzer, 2006). Nonprofit-business collaboration literature commonly suggests that collaborative engagements by companies with NPOs, and positive judgements of companies’ corporate responsibility practices by NPOs, positively affect households’ legitimacy evaluations of companies, and by extension increase households’ willingness to support these companies (Austin & Seitanidi, 2012a; Yaziji & Doh, 2009). In contrast, social movement theory suggests that confrontational activities by NPOs have the ability to raise doubts concerning companies’ corporate responsibility practices, and negatively affect households’ legitimacy perceptions of targeted companies, thus lowering their willingness to support these companies (Briscoe & Gupta, 2016; King & Pearce, 2010; Soule, 2009; Valor & Merino de Diego, 2009).

Importantly in the context of this thesis, from the perspective of NPOs households are not only important as consumers, but also as donors (Bekkers & Wiepking, 2011a; Burt, 2014). Literature dealing with collaborative relationships between companies and NPOs suggests that being collaboratively oriented serves to enhance the legitimacy of NPOs with its stakeholders, and thus their capacity for attracting donations (Austin & Seitanidi, 2012a; De Lange et al., 2016; Herlin, 2015; O’Connor & Shumate, 2014). In contrast, scholars investigating more confrontational approaches by NPOs towards companies argue that confrontational activities can help NPOs gain legitimacy and subsequently resources, because activities holding companies accountable for unsatisfactory behavior are expected by the public, and because confrontational NPOs are perceived as remaining independent from companies (Den Hond et al., 2015; Eesley et al., 2015; Herlin, 2015; Soule, 2009).

Beyond the Dyadic: Interaction-Effects Between Different NPO Approaches

In 1984, Haines introduced the concept of ‘positive and negative radical flank effects’ to social movement scholarship. The basic premise of this concept is that the presence of confrontational groups can affect outcomes for collaborative groups by influencing how third parties judge the legitimacy of their approach. ‘Positive radical flanks’ exist when the presence and actions of confrontational groups positively impact collaborative groups’ legitimacy, and their goal and resource attainment. ‘Negative radical flanks’ exist when the activities of confrontational groups negatively influence collaborative groups’ legitimacy, and their ability to work towards their objectives and attain resources (Haines, 1984; Haines, 2013).

Haines’ (1984) finds evidence for the existence of positive radical flank effects. In his study, the activities of more confrontational groups have positive effects on the funding base of more collaborative groups. While Haines’ study does not focus on interactions between NPOs and companies, a handful of research articles has referred to such flank effects when investigating such interactions. This research, too, points towards the existence of positive radical flank effects. Studies by Balsiger (2018), Burchell and Cook (2011; 2013), Valor and Merino de Diego (2009), and Van Huijstee and Glasbergen (2010) indicate that the activities of confrontational NPOs induce companies to enter into collaborative relationships with NPOs in order to implement more encompassing corporate responsibility practices.

Practically non-existent, however, is scholarly investigation on potential flank effects running the other way, that is with regards to how the presence of collaborative NPOs influences the ability of confrontational NPOs to influence corporate responsibility and attain resources. Some scholars hint at the potential existence of positive effects for confronters emanating from the presence of collaborators, in the sense that collaborative NPOs can work jointly with companies to find solutions to problems that confrontational NPOs point out (Conner & Epstein, 2007; Simsa, 2003; Van Huijstee & Glasbergen, 2010). Scholars have also suggested that negative effects for confrontational NPOs might surface from the presence of collaborative NPOs. They argue that confrontational approaches might lose legitimacy in the eyes of the public in the presence of collaborative approaches (Burchell & Cook, 2013; Poncelet, 2001), and that collaborative NPOs offer companies a protection against criticism directed at them (Baron et al., 2016), thus shielding companies from the potential adverse effects on their legitimacy emanating from confrontational NPO approaches (Balsiger, 2018; King & Pearce, 2010; Yaziji and Doh, 2009). Yet, scholarly investigation into the way in which the presence of NPOs with a collaborative stance towards companies affects NPOs with a confrontational orientation is basically limited to an array of suggestions, and lacks closer scholarly scrutiny.