Value Creation For Stakeholders Research Articles

Business model for integrated sustainable value creation: A supply chain perspective

In the context of globalization, the process of value creation is becoming more complex, exposed to greater risks for companies, partners, and customers. Moreover, modern digital technologies, such as the use of digital twin technology, can increase the use of geographically dispersed work teams and contribute to sustainable value creation in the future. However, the digital transition creates new organizational models and influences relationships in supply chains, thus affecting structural changes in business models.Hence, the study aims to investigate, from the whole value chain perspective, how the next generation of digital services is affecting business value and changing the business model concept. In addition, this paper discusses the stakeholder and social responsibility value creation perspective on business model for integrated sustainable value creation. To investigate this, it was decided to use a quantitative methodology in the form of questionnaires, which were distributed among different interested parties: two contractors, three suppliers, and an operator. The results indicated that all respondents, such as an operator, shipping companies, and subsea service providers, are positive about future digital technologies, which should ensure environmental sustainability, improve human interaction and communication. At the same time, they emphasize the importance of integrated join work within the value creation element. Overall, all participants are interested in reducing costs, they expect initiatives from each other in offering sustainable and innovative solutions, and to achieve these, innovative cooperation is needed. AcknowledgmentThe study is supported by a grant from the Research Based Innovation “SFI Marine Operation in Virtual Environment (SFI-MOVE)” (Project no: 237929) in Norway.

Stakeholder value creation: A case of the hospitality industry

The aim of this study is to understand whether the current literature deals with the general issue of stakeholder value creation and of specific marketing activities for human resources and if they can generate value for different stakeholders. In order to achieve this goal, the paper uses a bibliometric analysis that determines the conceptual structure of the topic, highlighting its evolution over time. Accordingly, this study uses the precise context of the hospitality industry since human resources are of strategic importance in the world of hospitality. This paper opens up a series of considerations, extremely useful within the context of stakeholder value creation in orienting marketing research in the future. In particular, the main findings reveal that with regard to stakeholder value creation only open-to-society marketing can be useful and successful, in contexts of a win-win situation for the sustainable shared advantage

Corporate value creation, stock price synchronicity and firm value in China: implications for beyond

PurposeThis study introduces Social Contribution Value per Share (SCVPS), an indicator devised by the Shanghai Stock Exchange (SSE), as an easy-to-interpret Measurement of Corporate Social Performance (MCSP) to the international research arena. The authors first explore the informativeness role of voluntary disclosure of SCVPS in the stock market. The authors then go one step further to demonstrate the relationship between corporate value creation quantified by SCVPS and firm value.Design/methodology/approachThe study takes a new perspective – a quasi-natural experiment of SCVPS disclosure in 2008 and uses a Propensity Score Matched Difference in Difference model (PSM-DiD) to investigate the impact of SCVPS disclosure policy on stock price synchronization and firm value. Through manually recalculating all the values of SCVPS and its components, this study enables us to further investigate the relationship between corporate value creation for various stakeholders and firm value.FindingsThis study reveals that voluntary disclosure of SCVPS can signal firm-specific information to the market and reduce noise in returns, thus affecting stock price synchronization. The findings further demonstrate that such firm-specific information has value relevance to firm performance. Moreover, the authors demonstrate that corporate value creation for different stakeholders measured by SCVPS can significantly affect firm value. The moderating effects of ownership structures and industry types are also investigated, and an endogeneity test confirms the robustness of the findings.Practical implicationsThis study argues that SCVPS offers an economically viable way for firms, including small-and-medium-sized enterprises, in emerging economies to disclose corporate value creation and provide the public with a direct understanding and appreciation of the values created by corporations for stakeholders.Originality/valueThe result makes contributions to the MCSP literature and explores the informativeness of SCVPS disclosure. Besides, this paper demonstrates that SCVPS offers a good setting to explore the effect of corporate value creation on firm performance in an emerging market.

Impact of Disclosure of Integrated Reporting Practices on Stakeholder Value Creation (Special References to Listed Companies in Sri Lanka)

The purpose of this study is to investigate the impact of disclosure of integrated reporting (IR) practices on stakeholder value creation with special reference to listed companies in Sri Lanka. IR has become a new phenomenon in Sri Lanka. The studies conducted in other countries have proved that the impact of disclosure of IR practices on stakeholder value creation varied with time, country, and method used to measure variables and relationship found is inconclusive. Therefore, this research attempts to fill this research gap by examining the impact of disclosure of IR practices on stakeholder value creation. The two independent variables were used in the study as content elements, guiding principles. The dependent variables were earning per share (EPS) and return on capital employed (ROCE). The study applied the method of content analysis. The sample of the study consists the 50 of the top-most capitalized listed companies from 2015 to 2018. The authors constructed a disclosure index based on the content elements and guiding principles of the International Integrated Reporting Council (IIRC) and measured the integrated reporting disclosure score (IRS) of each company. Three hypotheses were used to achieve study objectives, whereas hypotheses were tested by the panel regression analyses. The findings of the study statistically confirmed that IR disclosure of both content elements and guiding principles were positive and significant impact on the stakeholder value creation process. Therefore, this study infers that IR is contributing towards the stakeholder value creation and it would be useful for corporates to decide how effectively the organization can implement IR. The further study provides insights on IR adoption to the practitioners and policymakers.
 Keywords: Content elements, Guiding principles, Integrated reporting, Integrated reporting framework

Taking Eco-Innovation to the Road—A Design-Based Workshop Concept for the Development of Eco-Innovative Business Models

At least since the European Union’s Eco-Innovation Action Plan, eco-innovation has received increased attention from scholars, practitioners, and policy-makers alike. Eco-innovation offers many opportunities for businesses in terms of cost reduction, competitive advantage, and sustainability. However, eco-innovative business models differ from conventional business models and have special requirements in terms of stakeholder involvement, value definition, and value creation. Facing technological progress, many businesses need guidance on how to translate the potentials arising from technological innovation into eco-innovative business models. Applying a design-based research approach, this study develops a design-based workshop concept to facilitate the development of eco-innovative business models on a firm level. The workshop concept was iteratively tested in a series of 22 workshops within the European Alpine bioeconomy sector. It transfers the specific requirements and substantive design principles of eco-innovative business models into an operative workshop concept. By building on stakeholder- and value-centred perspectives and ensuring a holistic understanding of sustainability and innovation, the paper derives a number of procedural design principles that could build the basis for further tools and methods of eco-innovative business model development.

Value Creation and Appropriation in Firms: Methodological Challenges and Research Opportunities

The stakeholder value creation and appropriation (VCA) approach is a new lens for understanding how the economic value created through the firm’s activities is shared among its immediate stakeholders—employees, customers, suppliers, government, and capital owners. A series of recent articles in the Strategic Management Journal have conceptualized the approach, developed the method, and shown its application in comparative case study analysis (Garcia-Castro and Aguilera, 2015; Lieberman, Garcia-Castro and Balasubramanian, 2017; Lieberman, Balasubramanian and Garcia-Castro, 2018; Kern and Gospel, 2020). The approach holds potential beyond the Strategy field: as a tool for investigating how firm-level decisions and practices create winners and losers, but also as a new way of linking these micro-level patterns to macro-level pressures and outcomes, thereby helping Management scholars contribute to addressing one of the world’s grand challenges. The need to better understand inequality in and around organizations has been acknowledged in recent years (Suddaby, Bruton and Walsh, 2018; Amis, Mair and Munir, 2020; Bapuji, Ertug and Shaw, 2020) but has been laid bare in particular during the Covid crisis (Bapuji et al., 2020; Munir, 2020). The goal of this panel symposium is therefore to take stock of how the stakeholder VCA approach has been used so far, reflect on considerations and practicalities of applying it to new empirical settings and research questions, and engage in a discussion of how it could be used to help us unpack the complex relationship between organizations and inequality. To this end, we bring together scholars who are experts on the approach with those who are pursuing research that could stand to benefit from it.

Exploring docility: A behavioral approach to interventions in business incubation

The business incubation process evolves through coach-incubatee interactions rather than merely institutional intervention. We contribute to a behavioral understanding of this process by exploring the determinants and expression of docility, a fundamental human behavior. Our findings suggest that business coaches’ perceptions of stakeholder value creation needs and their experience of incubatees’ proactive behavior are essential determinants of coaching behavior. These behavioral determinants lead coaches to place idiosyncratic expectations on and become responsive to incubatees, and this is reflected in the range of their interventions in new venture creation. From a behavioral perspective, the outcome of coaches’ interventions is a shared understanding of how to navigate the ambiguous and uncertain aspects of new venturing. Adopting a behavioral approach thus helps us to reframe business incubation—previously regarded to be a structured process—as a flexible process, more accurately capturing its role in facilitating the highly uncertain process of new venture creation.

Knowledge interoperability and re-use in Empathy Mapping: an ontological approach

Design Thinking is a human-centered approach extensively used across different domains that aims at problem solving, value creation for stakeholders and innovation by fostering creativity. The most characterising and critical step along the Design Thinking process is the empathy phase, in which stakeholder analysis is performed by looking at a given scenario from the perspective of different stakeholders. Such a methodology enables a systematic information gathering and organization that results in a deep understanding of actual problems, needs and expectations from the target stakeholders. The uniqueness of problems and the need for situation-specific data makes knowledge re-use not always practical, even within the most consolidated and experienced environments. In this paper we propose an ontological support to empathy mapping that aims to (i) establish an interoperable fine-grained data layer among the different data collected throughout the empathy mapping process, (ii) enable multi-scenario analysis underpinned by formal specifications and (iii) further empower the process through semantic enrichment and integration of insight from multiple sources and contexts. We believe this is the first step to design and properly integrate effective computational and AI-based functionalities along the creative design thinking process, as well as to enable in practice richer and more sophisticated approaches (e.g. through social networks).

Stakeholder Value Creation: Comparing ESG and Value Added in European Companies

In recent years, a renewed interest in value creation for stakeholders has been witnessed in different contexts. Different tools have been proposed to try to grasp and measure such value(s) but, in many cases, the main perspective remains that of the shareholders. To contribute to the field of research that aims to discuss novel ways of thinking about value creation measurement, this paper addresses the relationship between ESG (Environmental, Social, and Governance) ratings and Value Added, as proxies of value creation and distribution for stakeholders. In particular, we consider whether ESG ratings are able to capture companies that are characterized by their capacity for generating higher Value Added for stakeholders. Our analysis uses the frontier methodology combined with means comparison. Data from 2018 were downloaded from EIKON, for all companies within the Euro zone and for all sectors (1932 companies, of which 399 held an ESG rating, compared with 1533 without ESG analysis). Our analysis reveals that, although ESG is theoretically considered a good social responsibility proxy, ESG indices cannot be used as an indicator of value creation for stakeholders but, rather, must be considered as only one of the components. This implies a need to review the limitations of ESG ratings and establish that the relevant indices are not suitable for use in universal or absolute decision-making.

A Text-Mining Analysis on the Review of the Non-Financial Reporting Directive: Bringing Value Creation for Stakeholders into Accounting

The recent Review of the Non-Financial Reporting Directive (NFRD) aims to enhance adequate non-financial information (NFI) disclosure and improve accountability for stakeholders. This study focuses on this regulatory intervention and has a twofold objective: First, it aims to understand the main underlying issues at stake; second, it suggests areas of possible amendment considering the current debates on sustainability accounting and accounting for stakeholders. In keeping with these aims, the research analyzes the documents annexed to the contribution on the Review of the NFRD by conducting a text-mining analysis with latent Dirichlet allocation (LDA) probabilistic topic model (PTM). Our findings highlight four main topics at the core of the current debate: quality of NFI, standardization, materiality, and assurance. The research suggests ways of improving managerial policies to achieve more comparable, relevant, and reliable information by bringing value creation for stakeholders into accounting. It further addresses an integrated logic of accounting for stakeholders that contributes to sustainable development.

Methodology of creating success criteria within the business model for sustainability reasons

A complex business environment, growing intensity of competition and shortening of innovation cycles bring difficulties for management and decision making. If previously companies aimed to ensure the quality of their products, now the creation of value for customers and other stakeholders is becoming the most essential element for the future of a company. Sustainability in the sense of a sustainable business model represent the value creation in the stakeholders' perception. It means that each activity while modelling a business should be checked for sustainability reasons by the company's management. In this way it would be possible to improve controlling mechanisms within the company as well. The aim of this paper is to offer a methodology contributing to creation of success criteria. As a result, there are methods presented which make the development of success criteria for management possible and sustainability controlling for business activities related to time, costs, flexibility and quality.

Corporate Succession Practices and the Impact on Portfolio Returns

Recent years have seen a rapid acceleration in the adoption of stakeholder value creation as a core tenet of sound business practice. We examine the impact of a firm's succession practices on a typical financial stakeholder: one who holds a company's stock as part of a diversified investment portfolio. We find that mainly due to intellectual capital losses at firms supplying talent, external executive hiring decisions expected to maximize the hiring firm's value can reduce shareholders' portfolio value. We use the literature, direct calculation, empirical analysis, and an economic model to quantify costs imposed on those who own shares of firms within the context of a larger portfolio. Assuming managers' value-maximizing assignment to jobs, the estimated cost for the S&P 1500, a representative portfolio, is conservatively 0.98 percentage points per year of portfolio returns. Our research motivates portfolio holders to increase their focus on firms' succession practices.

Value creation in industrial clusters: the strategic nature of relationships with stakeholders and the policy environment

PurposeGiven that an industrial cluster contains a high concentration of numerous stakeholders, a firm in an industrial cluster often ends up forming relationships with many of the stakeholders. The research questions are as follows: Does stakeholder-based management always lead to greater value creation? What are the moderators in this association? This paper proposes that although relationships with stakeholders can act as a “catalyst” for value-creation, they can also act as a “retardant.” A combination of (1) the strategic nature of the relationships and (2) the policy environment determines whether the relationships with stakeholders act as catalysts or retardants.Design/methodology/approachUsing relationship-focused theory, a conceptual framework that adopts a relational view of stakeholder theory is developed. Given the high concentration of stakeholders in industrial clusters, the conceptual framework uses stakeholders in industrial clusters as a setting. A firm can form relationships with a variety of stakeholders in an industrial cluster. The strategic nature of a relationship with a stakeholder is assessed in terms of variations in strategic intent and intellectual spillover.FindingsThe key argument is the following: whether a relationship with a stakeholder becomes a catalyst or a retardant for value creation is contingent on the fit between the strategic nature of the relationship and the policy environment. For instance, in a probusiness policy environment, relying on relationships with stakeholders that maximize intellectual spillover can act as a catalyst for value creation. In contrast, in an antibusiness environment, not having to rely on intellectual spillover is a safer option.Originality/valueWhereas the literature implicitly assumes that stakeholder theory has relational essence, the conceptual framework developed in this paper adopts a relational view of stakeholder theory in a very explicit way. This paper applies relationship-focused theory by making explicit the different forms of stakeholder relationships. Such an explicitly relational approach in theorizing can help in more in-depth research on the link between stakeholder relationships and value creation. The conceptual framework will allow future research to analyze value creation in an industrial cluster, especially in terms of how stakeholder relationships can act as either catalysts or retardants.

Resource Management in BOP contexts: Toward a Social Resource Orchestration Theory (SROT)

Research in global supply chains increasingly covers the highly resource constrained, poverty-stricken, bottom of the pyramid (BOP) context as a potential market for revenue growth opportunities. Still, how firms can design and manage material and support flows across the global supply chain to overcome the constrained resources and enable social, environmental and economic value creation for stakeholders, remains a challenge. Qualitative data was collected via expert interviews and field visits with representatives of key stakeholders serving the BOP. Preliminary findings imply that companies need to dynamically engage and manage capabilities both internally and externally in order to be successful in BOP contexts. This research identifies intermediaries as a key stakeholder group who either engage in physical material flows or support flows. These intermediaries show specific stakeholder management and context shaping capabilities that focal firms can leverage in the BOP context. The emergent integrated framework suggests a move toward a social resource orchestration theory (SROT).

Stakeholder Responsibility and Value Creation in Organizations: Insights from the Health Care Sector

Although there is an extensive literature on firms’ responsibility to its stakeholders, little attention has been given to stakeholders’ responsibility to organizations and to other stakeholders. W...

Financial Strategy Formulation and Implementation under Economic Uncertainty: Ukrainian companies’ case

Factors of economic uncertainty are considered. Economic uncertainty factors’ effect on financial managerial decisions is studied. Financial strategy matrix is proposed on the basis of a sample of Ukrainian companies. The proposed financial strategy matrix covers both financial and market goals – according to the BSC methodology. Thus, in the proposed tool, financial goals are reflected by the level of leverage A/E (Assets-to-Equity), market goals in turn are represented by ROA level; combination of the financial goal (A/E) and market goal (ROA) produces ROE, i.e. level of value creation for stakeholders. Within the proposed methodology financial strategy uses an analytical tool that combines financial and market goals of the enterprise, where the abscissa axis plots ROA level, the ordinate axis plots A/E level. The algorithm of making managerial decisions on financial strategy is described on an example of a company from selected sample – PJSC “Carlsberg Ukraine” – over 2014-2018. A set of managerial decisions targeted at further financial and market position is proposed.

Board gender diversity and environmental, social, and economic value creation: Does family ownership matter?

AbstractPrior literature on firm value creation for stakeholders has oversimplified and narrowed the concept of value down to “economic returns.” Although economic returns are fundamental to a firm's core stakeholders (i.e., shareholders), other legitimate stakeholders want “value” beyond economic returns. We define stakeholder value as the financial and nonfinancial returns a firm can offer to its legitimate stakeholders, and empirically investigate whether board gender diversity (BGD) improves our multidimensional measure of value. Using Thomson Reuters' ASSET4 data for U.K.‐listed firms available from Eikon for the period 2007–2017, we report a significant positive relationship between BGD and stakeholder value creation. In particular, BGD increases social and environmental value creation in addition to economic returns. Furthermore, our results suggest that even though gender‐diverse boards are associated with stakeholder value creation in family firms, this is only conspicuous for environmental value creation. The findings suggest that although female directors cater to the interests of broader stakeholder groups, family ownership causes them to mainly focus on environmental stakeholders. The study provides important implications for regulators, stakeholders, and academic scholars.

Entrepreneurs’ ingenuity and self-imposed ethical constraints: creating sustainability-oriented new ventures and knowledge

Purpose Ingenuity can be viewed as the use of creativity to develop innovation within constraints. The authors investigate how entrepreneurial ingenuity is enhanced by self-imposed ethical constraints, by using a case study of sustainability-driven technology enterprises in an emerging economy. The authors find that self-imposed ethical constraints can enhance entrepreneurial ingenuity because they encourage entrepreneurs to solve more complex problems as a result of considering the impact of the business on a more diverse set of stakeholders. The aim of this study is to show that while additional resources are normally considered an advantage, a dearth of resources can be a source of competitive advantage leading to ingenuity. By self-imposing ethical constraints, founders increase engagement of stakeholders who shape the firm’s industry toward greater sustainability knowledge. Design/methodology/approach The authors used semi-structured interviews which are typically the most important data source in the Gioia methodology because they provide both retrospective and present accounts by individuals experiencing the phenomenon of theoretical interest (Gioia et al., 2012). The authors focused on founders at each enterprise who had sufficient knowledge to speak comprehensively and authoritatively about their organizations. The goals of the semi-structured interview protocol were to focus on the research question, avoid the use of terminology that could lead interviewees in their answers and maintain flexibility to explore spontaneous themes during the interviews. Findings The authors examined the influence of entrepreneurial ingenuity on the creation of knowledge in an organization's environment. They defined entrepreneurial ingenuity as a type of organizational ingenuity (Lampel et al., 2014a, 2014b) and by focusing on the role of ethical constraints, examined the conditions under which it is influenced. They emphasized that ethical constraints warrant consideration in the knowledge management process (Rechberg and Syed, 2013) because they can stimulate entrepreneurial ingenuity. The authors also investigated the relevance of ethical constraints for founders of social enterprises in Brazil, an emerging economy of growing interest to knowledge management scholars. Research limitations/implications This study brings the following three main contributions. First, by incorporating the scope of social entrepreneurship, the research contributes to the perspective that both ethics and innovation can positively coexist within an organization while contributing to knowledge management creation and success (Borghini, 2005; Schumacher and Wasieleski, 2013). Second, the authors establish ethics as an important type of constraint that can spark ingenuity and help break through the constraints of bounded awareness for knowledge management (Kumar and Chakrabarti, 2012). Third, by highlighting the role of self-imposed ethical constraints, this study helps answer a recent call for research on “entrepreneurial actions that benefit others” (Shepherd, 2015, p. 490) addressing “What are the constraints that disable or obstruct an organization’s normal routines from alleviating human suffering?..It could be less about whether it is good or bad to ignore constraints and more about which constraints are ignored and which are abided by” (Shepherd, 2015, pp. 499, 501, emphasis added). Practical implications In this study, the authors show that entrepreneurs facing ethical dilemmas experience a unique cycle of equilibration, essentially throwing customary norms of equilibrium into disequilibrium. Treating ethics as both a lever and a constraint allows a more unique set of problems to be solved through knowledge management and entrepreneurship, so solutions to these problems can themselves become new sustainability-driven businesses. Social implications This study opens up several opportunities for future research. The authors conducted a study with five sustainability-driven enterprises from Brazil. New research may benefit from examining a larger number of organizations in other countries to investigate potential environmental differences that affect ingenuity and knowledge management. This study highlights the notion of ethical constraints as enabling mechanisms, and thus self-imposed ethical constraints merit a more systematic consideration as a key additional factor that may inspire disruptive innovation (Christensen, 2013), blue-ocean strategy (Kim and Mauborgne, 2004), as well as value-creation for stakeholders (Tantalo and Priem, 2016). Originality/value Resources are critical to both knowledge management and entrepreneurial activity and have been examined from numerous perspectives (Alvarez & Busenitz, 2001; Barney, Wright, & Ketchen, 2001; Moustaghfir and Schiuma, 2013). Entrepreneurs following a creation strategy depend less on accumulating existing knowledge and resources before beginning, and more on forming new knowledge or relationships that do not yet exist. They do this through a process of entrepreneurial trial and error (Alvarez & Barney, 2007, 2010). From a knowledge management perspective, individual knowledge sharing through both experimentation and learning by doing provide consistently high levels of knowledge sharing (Burns, Acar and Datta, 2011). This research emphasizes that constraints, such as limited resources and self-imposed ethical standards, can be a source of advantage leading to ingenuity and knowledge creation.

Marching Towards Creating Shared Value: The Case of YES Bank

The case highlights YES Bank’s responsible banking approach through its journey of 12 years characterized by agile response to business opportunity and societal needs, innovative product design, organic and steady business growth and healthy shareholder returns. Responsible banking has evolved with an inclusive approach wherein it is aimed at sustainable development by creating social and natural capital along with creating stakeholder value. The three pillars of responsible banking in YES Bank are; Triple Bottom Line accounting and reporting, climate finance, and corporate social responsibility (CSR). The case raises the question about the ways of measuring the effectiveness of the responsible banking initiatives.

Approach to Designing Systems for Delivering Value

AbstractHow value emerges from the interactions between different classes of stakeholders (like customers, service providers, suppliers, acquirers and so on) and the ways and means to enhance the interactions is a phenomenon that is increasingly becoming a significant game changer in any human endeavor. Increasingly, stakeholders expect something of interest to emanate for them whenever they participate in an endeavor. This thing that the stakeholders wish to create or experience is subjective and every stakeholder has their own perception of what this thing is. It is often the case that the thing that enthuses a stakeholder is the perceived value that they feel they can obtain; and the thing that they experience or create when participating in the endeavor is the actual value. In this situation, stakeholders often try to minimize the gap between their perceptions and actuals. This is often difficult to achieve as the notion of what is of value is time and stakeholder dependent. In order to address these issues, in this paper, a systematic approach to facilitate stakeholder value creation is presented and the underlying rationale for the approach discussed. This approach is based on the premise that in all human endeavors, goal or purpose of the endeavor, human centric processes, quality of these human‐centric processes, outcomes and the quality of the outcomes determine the value that different stakeholders create or experience. It is essential to understand, establish and articulate the right value influencing factors and criteria so that value is created for all stakeholders. This is further substantiated by the system value cycle wherein value created by the stakeholder by utilizing one or more systems. A set of eight different processes to institutionalize the stakeholder value creation dynamics is also presented to aid in the value co‐creation, sustenance and transformation.