Do Stakeholder Orientation and Environmental Proactivity Impact Firm Profitability?

Franck Brulhart (), Sandrine Gherra () and Bertrand Quelin
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Franck Brulhart: Aix-Marseille Univ, LEST, CNRS
Sandrine Gherra: Montpellier Business School and Montpellier Research in Management

Journal of Business Ethics, 2019, vol. 158, issue 1, No 2, 25-46

Abstract: Abstract The impact of socially responsible corporate behavior on economic performance is a major preoccupation of managers today. This article explores the links between narrowly defined constructs: stakeholder orientation, environmental proactivity and profitability, from the perspectives of stakeholder theory and resource-based theory. We collected data on the food and beverage, and household and personal products industries. Using structural equation modeling, this paper makes two contributions. We found a negative link between companies simply having a higher stakeholder orientation and profitability. Importantly, however, environmental proactivity not only had a positive impact on profitability, but also appeared to mediate the relationship between stakeholder orientation and profitability. In other words, if a company is more environmentally proactive, it will be more attentive to a broad array of stakeholders, and this will in turn contribute positively to profitability.

Keywords: Environmental proactivity; Firm profitability; Resource-based theory; Stakeholder theory; Stakeholder orientation (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (30)

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Working Paper: Do Stakeholder Orientation and Environmental Proactivity Impact Firm Profitability? (2019)
Working Paper: Do Stakeholder Orientation and Environmental Proactivity Impact Firm Profitability? (2017)
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DOI: 10.1007/s10551-017-3732-y

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