1. Making the Debate Over Corporate- Stakeholder Responsibility A Two-Way Conversation Andrew C. Wicks (and Jerry Goodstein) Associate Professor Co-Director, The Olsson Center Academic Advisor, BRICE

2. Andrew C. Wicks Introduction Core Idea: To come to terms with what we mean by “business ethics” and to be able to foster ethics within business, we need to discuss the responsibilities of both Corporations AND Stakeholders. Meaning of Responsibility: - Things that we should attend to; - Things that arise out of obligations we take on. Three Specific Meanings of Responsibility (following Bowie) - SR-R (Reciprocity) - SR-I (Interdependence) - SR-A (Accountability)

3. Andrew C. Wicks Background Current Focus of Literature: - Responsibility of Corporations (with Stakeholder Theory and Corporate Social Responsibility) Understandable Given Import/Power/Size of MNC’s Our Goal: - Not to Drop the focus on CR - Not to argue that Corporations need a break or that more responsibility should shift to Stakeholders - Focus on Both CR and SR; Both matter and both Deserve Attention (also Bowie and Raden) CR is Incomplete without attention to SR

4. Andrew C. Wicks Why Does Stakeholder Responsibility Matter? For (At Least) 5 Reasons: - A New Way to Characterize Business Ethics - Explaining Moral Failures - Making Organizational Moral Failure Rare - Creating Organizational Excellence and Outstanding Performance - Conceptualizing and Working Through Novel Business Challenges

5. Andrew C. Wicks Why Does Stakeholder Responsibility Matter? Reason #1: A New Way to Characterize Business Ethics - Goal: Connect Business and Ethics in a “Natural”/Organic Way; SR as Promising Alternative - Language of Responsibility: Integral to Business - Distinctive Framing on Stakeholders: Extends Focus Beyond Firms; Gets into Day-to-Day Life of Firms - Overlaps with Other Theories (e.g. OCB; ST; CSR; Ethics); Opportunities for New Theory Development - Rhetorical Device: Allows Managers to Engage Stakes - Provides a Normative Benchmark: Gives Firms, Stakes and Critics a Way to Assess Performance

6. Andrew C. Wicks Reason #2: Explaining Moral Failures in Corporations - Provides Detailed and Comprehensive Lens To Study Failures: Rich Perspective to Look at Enron, Worldcomm, Tyco, etc. - SR Helps Frame Complexity of Breakdowns: Involves Many Stakeholders and Organizations Need to Look at Parties involved and Their Interactions - Regimes of Responsibility: Systems of Shared Norms, Understandings and Practices that Allow Things to Get Accomplished without Ethical Failures. Need to Understand and Unpack Regimes of Responsibility and Where/Why They Broke Down Why Does Stakeholder Responsibility Matter?

7. Andrew C. Wicks Why Does Stakeholder Responsibility Matter? Reason #3: Making Organizational Moral Failure Rare - How do we Change Organizations to Reduce Ethical Failure? Media focus on Top Management and Boards; Yes, But also Deeper Analysis including SR - Focus on Regimes of Responsibility: Look for Patterns in Why Regimes of Responsibility Break Down - Examine Studies on Individual and Group Stake Behavior: Use These to Design More Robust and Sustainable Regimes of Resp - Look at Best Practices for Push Back and SR Example of eBay and Feedback Forum

8. Andrew C. Wicks Why Does Stakeholder Responsibility Matter? Reason #4: Creating Organizational Excellence and Outstanding Performance Stakeholders and Mission: Great Companies Engage Stakeholders and Make Them Passionate about the Firm/Products/Mission SR and Excellence: To Deliver Excellence, Firms Need Stakeholders to Work Together to Fulfill Responsibilities Beyond Expectations - Needs to Drill Down into Idiosyncratic Routines and Practices that Make Organizations Flourish SR and CA: Patterns of SR Can Become a Significant and Durable Source of Competitive Advantage (e.g. Starbucks, Southwest Airlines, and eBay)

9. Andrew C. Wicks Why Does Stakeholder Responsibility Matter? Reason #5: Conceptualizing and Working Through Novel Organizational Challenges Novel Challenges Exist: Lots of Existing Challenges Facing Society (and Business) Involve Cooperation of Both Firms and Stakeholders Global Economy Fosters Novel Challenges: Interdependence and Shared Responsibility are Growing (across Firms and Stakeholders plus Society, Government and NGO’s) Power of Language: SR Provides Language to Conceptualize and Engage both Firms and Stakeholders - The Environment: HP and Office Depot on e-waste - Global Labor: Nike and the FLA/WRC

10. Andrew C. Wicks A Research Agenda Business Ethics: - Discussion of Responsibilities (often Omitted) Along with Rights in Business (e.g. Duties of Employees back to Firms) - Normative Theories of “Responsibility” for Stakeholders and Firms Management Theory: - Empirical Work Focusing on Forces at Work Shaping Individual and Group Behavior (e.g. Network Theory and Organizational Design) - Theory and Empirical Studies on What Happens When Firms and Stakes Fulfill Mutual Responsibilities (e.g. does Commitment or Trust Increase?) - Linkages to Trust and Supply Chain Literatures Leadership in Organizations: - As Agents for Creating Regimes of Responsibility that Avoid Mishaps, Enable Success and Envision New Partnerships to Address Novel Challenges

11. Andrew C. Wicks Current and Future Research Projects on SR Developing Theories of SR and its Import within Organizations - Conceptual Model Looking at SR as a Variable that Impacts Specific Organizational Dynamics (e.g. like trust, commitment, capability) [Paper with Goodstein] Empirical Testing of SR - Use of Implicit Association Test and Expressed Values in Stock Picking Exercise; Explores Link Between Normative Orientation and Stakeholder Decision-Making[Papers with Fairchild and Goodstein] - Empirical Paper Testing Conceptual Model of SR [Future Paper with Goodstein]