1. Introduction “You live in the age of interdependence.

Boarders don’t count for much or stop much, good or bad, anymore.”1

Globalisation has opened up world markets and, according to Elmouden (2009:69), the term can

be seen as an attempt to understand actual processual observations, and its very makeup

recognises and has an impact on our social order. Globalisation can also, due to the

interconnected nature of the world today (Dinan, 2008:59), be understood to describe the

phenomenon whereby human mobility, or migration, has increased and resulted in the redefinition

of traditional boundaries which exist both structurally and discursively. This redefinition of traditional

boundaries not only has an influence on legitimate business activities both nationally and globally,

but can also be understood to be a mechanism for migratory practices which reflect the darker side

of globalisation, namely marginalised communities which are emerging due to social inequality and

structural irregularity. An example of such a social inequality and structural irregularity is the

trafficking of persons. Dinan (2008:58) suggests that the trafficking of persons does not necessarily

start as forced migration but rather can be seen as an economically motivated alternative to

existing social forces, the political environment, and/or the economic conditions within countries.

In an attempt to combat the trafficking of persons, the United Nations Office on Drugs and Crime

(UNODC) regularly holds office meetings and implement regulations aimed at combating this

crime. The most recent meeting at the UN General Assembly High Level Meeting on improving the

coordination of efforts against trafficking in persons was held 13-14 May 2013. In his opening

speech, Vuk Jemerić, President of the United Nations General Assembly for the 67 th session of the

United Nations General Assembly, stated among other things that data-collection remains a

challenge, support to victims remains inadequate, and that in order to gain success in anti-

trafficking initiatives, the cooperation of key stakeholders is necessary (Attachment 1). At the same

meeting, Yury Fedotov, Director General/Executive Director, stated that the 21 st Century is dealing

with a crime that is adaptive, cynical, sophisticated and exits in developed and developing

countries, and as such requires comprehensive data in order to understand the nature of this global

crime (Attachment 1) (Attachment 2).

The recognition of inadequate support for trafficking victims and the request by the UNODC for

comprehensive data highlights a potential weakness in existing communication and aid delivery

strategies. Furthermore, as the UNODC can be seen as the de facto representative of trafficked

persons, and the shadow communities which are the result of this phenomenon, an awareness of

how business-society relations and communication strategies can potentially enable and/or hinder

communication is important. This awareness can facilitate the collection of comprehensive data

through a consideration of organisational texts and conversations. These organisational texts and

1 Bill Clinton

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conversations, as Stohl and Stohl (2011:1212) point out, are embodied in the socio-cultural,

historical, and political context and must be taken into account and are therefore representative of

the communicative activities of agents (Stohl & Stohl, 2011:1211). Through a consideration of the

communicative constitution of an organisation (CCO), it is possible to “address how complex

communication processes constitute both organizing and organization and how these processes

and outcomes reflexively shape communication” (Putnam & Nicotera, 2010:159). The relevance of

such awareness can potentially allow for the improvement in support to victims of trafficking.

Also, as an organisation is a moral agent with moral and social responsibilities (Andriof & McIntosh,

2001:119), and in response to providing support to trafficking victims, businesses are to varying

degrees entering into partnership with organisations such as the United Nations (UN) by for

example signing the United Nations Global Compact as part of their global corporate citizenship

strategy. These partnerships can be advantageous to companies as well as the UNODC whose

structures can facilitate support efforts through Non-Governmental Organisations (NGO) and local

aid workers who work directly with issues related to shadow communities. However, according to

Ryan et al (2012:301), business relationships and networks associated to these relationships are

dynamic and complex in nature. The complexity of these relationships is furthered compounded by

the embedded nature, emergent qualities, and co-existence of continuity and change which

characterise these relationships

As the trafficking of persons and the phenomenon of a shadow community is characterised by

secrecy and exists outside of traditional boundaries, it is necessary that attempts to identify the

requirements of these stakeholders acknowledge the complexity surrounding them. As Stohl &

Stohl, (2011:1211) propose, metaconversations of secret organisations take place in a complex

socio-political context. As such, in order to effectively meet stakeholder requirements, it is essential

that the complexity of the context surrounding business-society relationships is recognised.

Consequently, it is necessary to examine the existing stakeholder mapping process with

consideration given to factors influencing the mapping of stakeholders in a global society where

community formation, more specifically shadow communities, require communication strategies

that reflect and/or acknowledge non-traditional spatial contexts.

1.1. Thesis StatementThe purpose of the thesis is to examine how the requirements of a marginalised community can be

better incorporated in the stakeholder mapping process in order to facilitate a third sector

communication strategy. Moreover, the objective is to create a further theoretical perspective on

the extent to which 21st century business-society relations, in a third sector context, have added a

new dimension to the mapping of stakeholders in a global society where community formations can

be seen to be in a constant state of flux. The relevance of this focus is that a comprehensive

overview of stakeholder requirements is possibly allowing for an inclusionary approach to the

mapping of stakeholders.

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This leads to the primary research question;

A change in mindset: How can a contemporary stakeholder mapping process be developed

in order to facilitate the communication of sector specific requirementsin a third sector business-society relationship?

The following sub-questions will be applied to guide the reader through the thesis:

1) What are the theoretical underpinnings of stakeholder management and global corporate

citizenship characterising business-society relations in the 21st century?

2) How do potential theoretical gaps call for the development of a dynamic approach to the

stakeholder mapping process?

3) How can a consideration of theoretical gaps facilitate an understanding of processes

affecting third sector activities?

4) Through a change in mindset, how can an awareness of processes facilitate an inclusionary

stakeholder mapping strategy?

1.2. Theoretical FrameworkThe conceptual nature of the thesis requires a solid theoretical foundation to be established from

which theoretical data can be drawn. As such, in line with the research scope, the thesis draws on

two primary theoretical aspects; namely stakeholder theory and corporate citizenship. Stakeholder

theory as a primary aspect will be discussed with specific focus directed toward the visual

representation of stakeholders. Theoretical data on stakeholder theory will be obtained from

theorists Milton Friedman and Samantha Miles (Stakeholders: Theory and Practice, 2006),

François Lépineux (Stakeholder theory, society and social cohesion, 2005), and Yves Fassin

(Imperfections and Shortcomings of the Stakeholder Model’s Graphical Representation, 2007) (The

Stakeholder Model Refined, 2008). In addition to Friedman and Miles, general stakeholder theory

aspects will be covered using Emerson W. Mainardes, Helena Alves, and Mario Raposo

(Stakeholder theory: issues to resolve, 2011). Additionally, through the incorporation of literature on

the corporate citizenship aspect, further primary data sources will be applied using Andreas G.

Scherer and Guido Palazzo (Ed.) (Handbook of Research on Global Corporate Citizenship, 2008)

and John Kline (Ethics for International Business, 2010). Information on the role and importance of

corporate citizenship will be provided to highlight the growing divide which is developing in the

determination and role of the responsibility of organisations in today’s global environment. This

literature will also establish the link between corporate citizenship and stakeholder theory. This

development will establish the role of corporate citizenship as a response to growing expectations

of society for an acknowledgement of responsibility by organisations.

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Additionally, as the thesis makes specific reference to the third sector, and more specifically social

inequalities and structural irregularities in the form of a marginalised community such as a shadow

community, it is necessary that awareness is developed of this sector. This awareness will be

developed through the incorporation of literature on the third sector by authors such as Peter

Walker and Daniel Maxwell, Helmut K. Anheier, and John Clark. Lastly, effective communication is

essential in a business and society relationship, especially in an environment which is

characterised by social inequalities and structural irregularities. Consequently, literature on the

communicative constitution of an organisation by Linda L. Putnam and Anne M. Nicotera

(Communicative Constitution of Organization: Critical Issues for Addressing It, 2010) and Cynthia

Stohl and Michael Stohl (Secret Agencies: The Communicative Constitution of a Clandestine

Organization, 2011) will be included to provide supporting material for the discussion in order to

establish the connection between the communicative constitution of an organisation and a

business and society relationship.

Secondary data in the form of various sourced articles published in international business and

scientific journals have been read in order to gain a clearer understanding of the role of stakeholder

theory, the third sector, and corporate citizenship in today’s global environment. The articles and

journals have been sourced through: Emerald Group Publishing, Wiley, Springer, Jstor, Sage, and

Science Direct, Journal of Business Ethics, Organization Studies, Business and Society Review,

Academy of Management Review, and Management Communication Quarterly.

1.3. DelimitationThe thesis is centred on the visual representation of stakeholders as a point of departure, with

consideration given to the potential scope for stakeholder inclusion. The purpose of the thesis is

therefore to address the applicability of a ‘one size fits all approach’ to the visual illustration of the

stakeholder map, which finds its visual foundation on a traditional capitalist reasoning.

Furthermore, as no agreed definition of ‘stake’ and ‘stakeholder’ exists amongst authors on

stakeholder theory, the thesis is not a discussion on the merits of the various authors on

stakeholder theory but rather an analysis of the potential for establishing a more inclusionary

approach to stakeholder mapping. Developing further on the theme of developing an inclusionary

approach to stakeholder mapping, the environment in which a company operates will be

considered. This consideration is in line with the overall context of how the needs of a marginalised

community can be met.

As the context of the thesis is business-society relationships, corporate citizenship has been

included. Corporate Citizenship and more specifically Global Corporate Citizenship is a relatively

new concept. The extent to which it can be considered an extension of Corporate Social

Responsibility can be debated as no agreed definition exists of either Corporate Social

Responsibility or Corporate Citizenship. The thesis will focus on Corporate Citizenship, with

particular attention directed at the role of Global Corporate Citizenship as a means of making

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distinction between Corporate Citizenship in the context of a national organisation versus Global

Corporate Citizenship in the context of global organisations such as non-governmental

organisations such as the United Nations.

Lastly, while the role of communication in the development of an inclusionary approach to the

mapping of stakeholders is acknowledged, this thesis therefore does not address the technicalities

of communication, that is, the theory of how communication occurs at the level of sender and

receiver. The thesis does however consider the communicative constitution of an organisation

(CCO) which, as Putnam & Nicotera (2010:161) propose, makes allowance for “processes that are

not simply microinteractions between individuals but also corporate agents who act; become

enacted in protocols, rules and procedures; and endure across time and space“. Stohl and Stohl

(2011:1212) expand further that organisational texts and conversations are embodied in a

historical, political, and sociocultural context. A consideration of this embodiment is of significance

for the development of a communication strategy which effectively addresses communication in a

dynamic business-society relationship. The discussion will therefore incorporate CCO

considerations as the relevance of such a focus is that inclusive communication strategies can

facilitate an inclusionary approach to business-society communication.

1.4. Thesis Structure 2 The purpose of the thesis is to increase awareness of factors that potentially hinder third sector

initiatives. In order to establish a coherent and holistic approach to the thesis, it will be divided into

seven chapters which seek to develop a logical progression through the thesis. Chapter One,

Introduction; seeks to establish the purpose and objective for the exploration of the topic of

stakeholder management in order to reflect the requirements of marginalised communities in a

global business-society relationship.

Chapter Two, Theory of Science; establishes the ontological and epistemological framework of the

thesis. The chapter will therefore establish the main characteristics of critical realism which

constitutes the proposed research perspective of the thesis.

Chapter Three, Research Methodology; presents the research design of the thesis. Due to the

conceptual nature of the thesis, data consists of theoretical concepts which provide the data source

for the analysis strategies.

Chapter Four, Literature Review and Theoretical Concepts; will establish the theoretical

foundation of the thesis. The objective of this chapter is therefore to examine existing literature and

develop the main empirical considerations of the thesis. The focus of sub-section one will be to

present existing theory on stakeholder management, explaining how this theory has an effect on

how stakeholder requirements are identified and mapped. Sub-section two, Corporate

2 Figure 1. (A Visual Overview of the Thesis Structure)

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Citizenship, seeks to develop an understanding of citizenship and the factors which underpin this

business-society relationship strategy. The final section, sub-section three, will narrow the focus of

theory to the real-world component of the thesis. Through a focus on the Third Sector, with

attention directed at a marginalised community (Shadow Communities), practical business-society

relationship considerations will be exemplified.

Chapter Five, Analysis; establishes the focal point of the thesis and establishes the theoretical

foundation and point of departure for the discussion. Sub-sections one and two will establish the

sociological and stakeholder foundations of stakeholder maps. Developing further on this

section, ethical development will analyse the process of ethical business. Allowing for the results

of the analysis in sub-sections one and two, sub-section three and four will explore the redefinition of stakeholders, addressing the potential for a change in mindset in how stakeholder mapping

requirements can be facilitated. Relative to the outcome of the aforementioned analysis, sub-

section five will address the applicability of a change in mindset concerning a redefinition of the

stakeholder mapping process.

Chapter Six, Discussion; debates the practical application of an alternative perspective for

addressing stakeholder mapping. Consideration will be given to the role of global corporate

citizenship and stakeholder mapping as the means through which a convergence of global

corporate citizenship and stakeholder mapping is possible. The discussion draws on the outcomes

and reflections of the analysis in order to address how a holistic and inclusionary approach to the

stakeholder mapping process is possible.

Chapter Seven, Conclusion; will draw on the reflections and considerations of the preceding

chapters in order to provide a comprehensive and logical summary. The summary will be carried

out so as to present a conclusion of the findings in order to provide a qualified response to the

thesis criteria.

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Sociological Foundation

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Redefining Stakeholders

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2. Theory of Science “the many and complex problems of today’s world cannot be explained without

recourse to social theory – a theory which explains why appearances assume the form they do, a theory which reveals the underlying factors, or structure, on which

are built the complex realities of everyday life. 3”

The shadow community phenomenon is characterised by secrecy and exists outside of traditional

societal boundaries, and as such requires a research method that recognises and makes

allowance for this. The development of an understanding which can elaborate on the social

construction which occurs within social worlds, and through which meaning is attributed to these

constructs by individuals, requires a closer examination of the research philosophy: ontology and

epistemology. Assumptions, or research philosophy, are reflected in the research method, and the

research methodology chosen is based on this research method (Saunders et al., 2012:128). The

research method, or paradigm, that is the ontological, epistemological, and methodological

premises (Denzin & Lincoln, 2000:22), therefore establish the framework of the researcher’s world

view and the context within which the research process is grounded. As such, the following chapter

will outline the research stance through a consideration of the research philosophy, that is the

ontological and epistemological paradigms.

The ontological principles, ‘how things really are’ and ‘how things really work’, adopt a belief that

there exists a reality ‘out there’, driven by unalterable natural laws (Guba, 1990:19). This view

implies a belief that something exists, is (already) there, and is measurable (Alversson, 2009:17).

Due to a reliance on measurability, positivism can be seen to be constrained to practicing an

objectivist philosophy (Guba, 1990:19) which requires that facts or data are observable (Alversson,

2009:17). While observability may instil confidence about what we think exists (Sayer, 2012:12),

such existence itself is however not dependent on it. Interpretivism, a further ontological

consideration, is a research paradigm which views reality, or selected parts thereof, as something

which is not naturally given (Alversson, 2009:23). Reality is therefore socially constructed

(Alversson, 2009:23), subjective, and unlike positivism in order for the empirical tests to be valid, it

is essential that the ‘facts’ collected are independent of the theoretical statements (Guba, 1990:25).

As such, ‘facts’ are viewed as facts only within a theoretical framework and result in a ‘reality’ which

only exists in the context of a mental framework (Guba, 1990:25). Epistemology, the nature of

knowledge about phenomena (Gioia & Pitre, 1990:585) or acceptable knowledge in a field of study

(Saunders et al., 2012:132), is centred on constructing models of mechanisms such that were they

to exist and act in the hypothesised way, they would account for the phenomena being examined

(Blaikie, 2000:108). As Blaikie (2000:108) explains further, these models establish hypothetical

descriptions which reveal underlying mechanisms, mechanisms which can only be known by

constructing ideas about them. Critical realism is an epistemology of laws as expressing

3 Crompton and Gubbay, 1977.p 4; original emphasis (in Houston, 2001:846)

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tendencies of things, opposed to positivism which advocates the conjunction of events (Blaikie,

2000:108).

Both natural and social scientists make a plausible case that the existence of unobservable entities

can be made by reference to observable effects, and that these can only be explained as the

products of such entities (Sayer, 2012:12). Such a view can be perceived to be restrictive as

allowance is not made for mechanisms which exist outside of the immediate purview of the

researcher. Whereas critical realism allows for a deeper understanding of a phenomenon through

an acknowledgement of the possibility that powers may exist unexercised, and an acceptance that

what has happened or been known to have happened does not exhaust what could happen or has

happened (Sayer, 2012:12). For critical realists, the world is therefore characterised by emergence

(Sayer, 2012:12), and this emergence signifies that situations which represent a combination of two

or more features are not reducible to their constituents even though these constituents are

necessary for its existence. Accordingly, in distinguishing the ‘real’, the ‘actual’, and the empirical,

critical realism proposes a stratified ontology (Sayer, 2012:12) which can facilitate a deeper

understanding of the environment in which a business-society relationship occurs. Consequently,

epistemologically both the positivist and interpretivist approaches can be seen as too restrictive as

allowance is not made for mechanisms which exist outside of the immediate purview of the

researcher. For that reason, critical realism has been chosen as the research stance as its

stratified ontology allows for a closer analysis of the business-society relationship within the context

of an NGO and a shadow community.

2.1. Critical RealismEpistemologically, positivism which relies on universal laws and a deductive research approach to

determining the single reality of people, can be considered too restrictive a research method.

Equally, interpretivism, which views reality as context specific and inductively addresses this in an

attempt to interpret how cultural variations and situations shape reality, can be seen to be too

constructionist in its approach. On the other hand, critical realism offers another perspective to

philosophical and methodological positions. Firstly, from a natural science philosophy perspective,

critical realism offers a third way between positivism and empiricism (Sayer, 2012:2). Secondly,

critical realism offers, according to Sayer (2012:2), an alternative to law finding and anti-naturalist

or interpretivist reductions of the philosophy and methodology of social science. Critical realism

therefore proposes a method for merging positivism with recognition of the necessity of an

interpretive understanding of meaning in social life (Sayer, 2012:3). Collier (1994:142) explains

society relative to critical realism as:

“Society is both the ever-present condition (material cause) and the continually

reproduced outcome of human agency. And praxis is both work, that is, conscious

production, and (normally unconscious) reproduction of the condition of production,

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that is society. One could refer to the former as the duality of structure, and the latter

as the duality of praxis”

Collier presents two related yet opposite conceptions, namely humanism and structuralism (Collier,

1994:141). Expanding further, Collier (1994:141-142) describes firstly ‘humanism’ as the view of

human agency as everything where social reality is nothing but human actions and their effects.

These actions may be in an official capacity on behalf of an artificial or corporate person who is

dependent on ‘natural persons’ for action to occur (e.g. there cannot be war without soldiers).

Secondly, ‘structuralism’ views social structure as everything, where whatever happens in society

happens because of social structures as they are (1994:142). Collier (1994:142) explains this as,

one cannot be a producer without a mode of production (e.g. a seller without a market), and

structuralism is not just an enabling factor but a determinant of the condition (e.g. a seller must

sell). Collier (1994:142) expands further that the social structure largely determines the

developmental tendencies of the society: a capitalist economy must progress technologically.

Collier (1994:143) suggests that humanism and structuralism cannot both be true, it is necessary to

have a theory which allows for both kinds of causality (Collier, 1994:143), that is agency and

structuralist causality. Bhaskar proposes that both humanism and structuralist causality are real;

agency has effects and so does structural causality: people make societies, and societies make

people (Collier, 1994:143). Bhaskar’s Transformational Model of the Society/Person Connection

and Social Activity (Figure 2.) visually illustrates the interconnected nature of critical realism. That

is, intentional causality (agency) requires pre-existing material causes (structures) as social

material causes (society) only by virtue of the fact that intentional agency reproduces and/or

transforms them (Bhaskar, 2008:155). Bhaskar refers to this interdependence as the duality of

structure and agency, this duality requiring an acknowledgment of the complexity of mechanistic

structures of a phenomenon. A further mechanistic process, which Bhaskar identifies, is the duality

of mediation and transformation which is an enabling and independent process and disembedding

mechanism (Bhaskar, 2008:155). This mechanistic process is characterised by change which

occurs primarily on a subconscious level and is present as an observable phenomenon on social

structures and their reproductive mechanisms (Bhaskar, 2008). Bhaskar therefore identifies the

relationship between social structures: (A) which enable and/or constrain human agency and (B)

which reproduce and/or transform these social structures, this reproduction and/or transformation

being facilitated by structural powers and their causal effects which result in the phenomenon.

Fig. 2. The Transformational Model of the Society/Person Connection and Social Activity(Adapted from Bhaskar in Collier, 1994; Bhaskar, 2008)

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2.2. Application of Critical RealismAccording to critical realists, the ‘real’ domain consists of the structures and mechanisms that

produce these events (Blaikie, 2000:108). The ‘real’ therefore, firstly, references both natural and

social existence regardless of whether it is empirical or a passable understanding of its nature.

Secondly, ‘the real’ is the realm of objects, their structure, and powers (Sayer, 2012:11). Whether

these structures are physical (minerals) or social (bureaucracies), certain structures and causal

powers exist and have the capacity to behave in a particular way with specific vulnerabilities to

certain kinds of change (Sayer, 2012:11). It is the phenomenon created by this vulnerability to

change that is of interest of realists who seek to identify the need, possibility, and potential for

change through the identification of these structures and powers.

Applying Figure 3, through an analysis of causation, the act of affection or causing action, critical

realists make a distinction between the ‘real’, the ‘actual’, and causal powers (Sayer, 2012:13). The

‘real’ refers to an object’s structures and powers, and the ‘actual’ refers to what happens if and/or

when the causal powers are activated and the result of such activation, that is the outcome (Sayer,

2012:12). The explanations of the phenomenon, which is a part of the structure (Sayer, 2012:14),

therefore focus on social or natural events with socially significant outcome patterns (Pawson

2000:298 in Blaikie, 2007:87). Pawson (Blaikie, 2000:298) explains further that explanation takes

the form of theorising some underlying mechanism (Blaikie, 2007:87), therefore requiring the

identification of the causal mechanisms and the conditions under which they activate the outcome

(Sayer, 2012:14). The mechanism that generates the outcome consists of propositions about how

structural resources and agent reasoning have constituted the regularity (Pawson 2000:298 in

Blaikie, 2007:87). According to Sayer (2012:15), the same mechanisms can produce different

outcomes according to context based on the space-time relations with other objects and their

causal powers and ability to trigger, block, or modify its actions.

Fig. 3. Basic elements of ‘logic of realist explanation’ for critical realismBlaikie (2007:87) (Adapted from Pawson 2000:298 and Pawson & Tilley 1997:72)

In the context of this thesis, the structural design of the visual representation of the stakeholder

map and its cognitive power will be examined. As an element of realist explanation, the stakeholder

mapping process therefore constitutes the outcome which requires closer examination in order to

determine the aspects which result in how stakeholders are visually represented. As an outcome is

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Outcomee Mechanism

Regularity Context

also affected by context, the third sector has been incorporated to establish the business context of

the business-society relationship. Through a focus on social or natural events, consideration will

be given to determining significant causal mechanism which can affect the outcome. The

identification of these causal mechanisms that generate the outcome will be addresses based on

awareness that mechanisms can produce different outcomes based on the context within which the

mechanisms occur.

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3. Research Methodology

The research methodology has been developed around four sub-questions which establish the

framework of the analysis, the reasoning, and evaluation of the theoretical data set. The design

makes allowance for the dynamic nature of the phenomenon under investigation and the choice of

research method, critical realism. Due to the conceptual nature of the thesis, a qualitative design

has been chosen. This design will allow for the development of an in-depth qualitative theoretical

data set (Daymon & Holloway, 2010:4) and will provide insight and understanding of the sense-

making and meaning attribution by individuals of the social world and the social construction which

occurs as a result of this in the social world (Daymon & Holloway, 2010:4). The application of the

research design draws inspiration from processual analysis (Pettigrew, 1997) and the Critical

Realist Research Spiral (Ryan et al., 2012). The design and analysis of the research methodology

will now be elaborated on.

3.1. Design and Analysis

Van de Ven (1992:169) argues that the use of the term process “as a sequence of events that

describes how things change over time” best describes and accounts for how an issue or entity

develops and changes over time (Pettigrew, 1997:338). Pettigrew (1997:338) expands further that

social reality is not a steady state, this dynamic state being a primary assumption behind process

thinking. The dynamic and changing nature of social structures, as Ryan et al. (2012:301) explain,

is characteristic of the critical realist conceptualisation. Elaborating further on this dynamism,

Sztompka (1991) explain that this dynamism occurs rather than merely exists (Pettigrew,

1997:338). The principal aim of the process analyst is therefore to catch this reality ‘in flight’

(Pettigrew, 1997:338), but in order to catch this reality ‘in flight’, it is first necessary to acknowledge

the emergent quality of actions. Actions drive processes and, according to Pettigrew (1997:338),

are embedded in contexts and it is these contexts which limit information, insight, and influence. As

such, the duality of agents and contexts, must be recognised as contexts are shaping and shaped,

and according to Giddens (1979) and Sztompka (1991), actors are producers and products

(Pettigrew, 1997:338).

To exemplify the processual process, Pettigrew (1997:339) draws an analogy to a river basin,

explaining that the study is not focused on a single river but rather on the river basin into which

numerous rivers flow and are dependent on one another, shaping and being shaped by variations

of the terrain. Visualise, if you will, the Amazon basin with its numerous rivers which merge to form

the Amazon River basin. Each of these rivers originate inland meandering through different terrain,

bringing with it area specific sediment. The merging of these rivers bring together sediment which

mingles with existing sediment in the river basin reshaping the terrain, and in many instances the

terrain exerting its own effect on the composition of the river basin. The river basin therefore not

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only shapes the terrain and composition of the river basin but also currents and flows which have

an effect on the outcome, that which is constituted by the river basin.

Using the river basin analogy, the aim of processual analysis is a study which embodies a search

for underlying mechanisms which drive processes, therefore accounting for and explaining ‘what’

happens, ‘why’ it happens, and ‘how’ it happens (Pettigrew, 1997:339). Task one therefore entails

a research design which reflects a commitment to ontological realism (Ryan et al., 2012:302-303).

Bhaskar (Ryan et al., 2012:303) elaborates further that this commitment recognises that business

relationships and networks are real entities and structures. Task two, the investigative process, is

characterised by a research strategy that places equal focus on both theory and empirical data

(Ryan et al., 2012:305). According to Ryan et al. (2012:305), the data collection process, which is

not dependent on controlled experiments, can be further clarified through an examination of the

stratified understanding of business relationships. Stratification is comprised of the domains of

actual, real, and empirical (Ryan et al., 2012:305) and potentially allows the researcher to reach a

deeper level of research. Through a deeper lever of research, it is possible to seek out actions,

related perceptions, and decisions associated to the nature of the relationship, as well as the

consequences related to the aforementioned.

Task three, data analysis, is characterised by an iterative relationship between task two and three

(Ryan et al., 2012:306) and the researcher’s engagement in the data to understand the generative

mechanisms which cause relationships or networks to emerge in an observable manner (Ryan et

al., 2012:307). The analysis develops an understanding and initial explanations of the

phenomenon. The initial understanding is developed further through an iterative process which

develops of a deeper understanding of the relationship or network (Ryan et al., 2012:307). Lastly

task four, causal explanations, develops further on task three and addresses the nature of causal

explanations, these explanations potentially presenting multiple competing explanations each with

possible plausible mechanisms explaining the phenomenon (Ryan et al., 2012:307).

Returning to the river basin analogy (Figure 4.a.), a parallel can be drawn between the river basin

and the thesis. Both studies require a design (purple, red) which reflects a commitment to the field

of study as well as recognition of a phenomenon which is characterised by dynamic factors.

Consequently, the river basin analogy is characterised by mingling of river flows that shape and

reshape the terrain, and an organisation by its operating environment where societal and

environmental factors can affect an organisation’s ability to operate effectively. The investigative (yellow) process requires awareness of the geographic environment both above and below the

waterline, knowledge which is reinforced by observation and a solid theoretic knowledge base. This

awareness and knowledge allows the geologist to delve deeper and carry out a stratified

investigation of the river basin. As with research on the river basin, the thesis establishes a

knowledge set of the theoretical underpinnings of the dataset through a literature review. This

literature review identifies possible gaps in knowledge which can influence the organisation’s ability

to address stakeholder needs. The analysis (yellow, green) process acknowledges the stratified

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characteristic of the river basin, allowing the analysis of mechanisms which can have a causal

effect on the river basin’s composition. In line with the analysis of mechanisms which can have a

causal effect on the river basin, the thesis analyses further the gaps identified in the literature

review allowing for possible causal mechanisms which can affect an organisation. Through an

iterative process between the analysis and the development of causal explanations (green, blue),

possible mechanisms explaining the phenomenon of a river are addressed. As with the river, the

iterative process of the thesis will analyse and develop causal explanations of factors which can

affect the ability of the stakeholder mapping process to effectively address the needs of

marginalised communities. The research process of both the river basin and an organisation’s

stakeholder mapping process, from design to explanation, is therefore characterised by a

continually evolving research process which seeks to identify mechanisms among the layers of

stratification in an attempt to understand the phenomenon under investigation.

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Figure 4.

Visual Overview of the Methodological Progression of the Thesis

SQ 2: How do potential theoretical gaps allow for the development of a dynamic approach to the stakeholder mapping process?

SQ 1: What are the theoretical underpinnings of stakeholder management and global corporate citizenship characterising business-society relations in the 21st century?

SQ 4: Through a change of mindset, how can an awareness of processes facility an inclusionary stakeholder mapping strategy?

SQ 3: How can a consideration of theoretical gaps facilitate an understanding of processes affecting third sector activities?

Sociological Foundation

Stakeholder Foundation

Ethical Developmen

t

Redefining Stakeholders

Potential for a Change in

Mindset

Applying a Change in Mindset

Research Question

SQ 4SQ 3

Critiquing/Evaluating

Reasoning/Reflecting

Theory

SQ 1

DescribingAnalysing

ConclusionDiscussion

SQ 2

A change in mindset: How can a contemporary stakeholder mapping process

be developed in order to facilitate the communication of sector specific requirements in a

third sector business-society relationship?

3.2. Research Questions and ObjectivesAs such the analysis has been designed to address the primary research question;

A change in mindset: How can a contemporary stakeholder mapping process be developed

in order to facilitate the communication of sector specific requirementsin a third sector business-society relationship?

In order to address the above problem statement four sub-questions will guide the reader through

the thesis.

Sub-question 1: (RED)

What are the theoretical underpinnings of stakeholder management and global corporate citizenship characterising business-society relations in the 21st century? The selection of a ‘what’ style question as the first sub-question has been done to allow for

exploration and identification of themes (Yin, 2009:9). Furthermore, through an abductive

research approach known factors will be used to generate theoretical data which can be

examined closer (Sayer, 2012:144). The development of this data is important in critical realism

as theory generation or modification, incorporating existing theory where appropriate, is an

essential part of building new theory or modifying existing theory in critical realism (Sayer,

2012:144). The objective of sub-question is therefore to define the theoretical underpinnings of

the thesis and how these theoretical assumptions are understood and defined.

The foundation will therefore, firstly, address theoretical perspectives on stakeholder

management by authors Freeman, Fassin, and Lépineux. Through a theoretical research

process theoretical underpinnings will be identified in order to determine similarities and/or

variances in the visual representation of stakeholders and the theoretical assumption upon

which this representation is based. The selection of authors is based on an awareness that

there exist numerous authors on the subject, but while stakeholder mapping does appear to

represent a standardised visual representation of stakeholders, there is however a degree of

visual evolution which is emerging. The intention is therefore to identify the theoretical

underpinnings which are and/or have an influence on the emerging visual representations of

stakeholders. The aim is therefore to identify and describe potential factors which the

aforementioned authors deem essential for the stakeholder mapping process.

Secondly, the selection of theory on corporate citizenship and global corporate citizenship is

based on establishing knowledge on how organisations interpret the theoretical underpinnings

of ethical business within the corporate citizenship and global corporate citizenship context.

Theory selected includes authors such as, but are not limited to, Crane, Wood and Logsdon,

and Kline. While no universally agreed definition exists on corporate citizenship and global

corporate citizenship, theory does reflect an agreement on certain factors which can and do

have an influence on the application of corporate citizenship and global corporate citizenship

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practices. The aim is therefore to determine and describe possible factors which define and

characterise ethical business and the implications of this effect. Lastly, focus will be directed at

the third sector in order to develop a theoretical understanding of what activities characterise

this sector and the environment in which they operate. The theoretical foundation includes

theoretical data on non-governmental organisations and shadow communities. As such, The

aim is therefore to define and provide insight into the factors which characterise the environment

and individuals who are the focus of third sector initiatives.

Sub-question 2: (ORANGE)

How do potential theoretical gaps call for the development of a dynamic approach to the stakeholder mapping process? The selection of a ‘how’ style question provides the context for an explanatory approach (Yin,

2009:9) to the data collected in sub-question one. Through a logical progression through the

theoretical assumptions, inferences will be drawn on the applicability of existing theory in order

to clarify and determine how possible gaps in theory can potentially inspire a dynamic approach

to stakeholder mapping. This will be realised through an analysis where, firstly; theoretical

assumptions on the relation between sociology and stakeholder mapping will be reflected on

with attention given to structural considerations. Secondly; through a consideration of the role

of responsibility, citizenship will be reflected on in order to gain an overview of the role of global

corporate citizenship. Sub-question two therefore seeks to examine and explain how the various

theoretical aspects make up the whole in an attempt to determine potential theoretical gaps.

Sub-question 3: (GREEN)

How can a consideration of theoretical gaps facilitate an understanding of processes affecting third sector activities? Sub-question three, will develop further on sub-question two. Through a process of reasoning

and reflection, sub-question will, firstly; address the possibility for a redefinition of stakeholders

through a consideration of Lépineux’s debate on community versus civil society. Secondly;

based on the aforementioned reasoning, the potential for a change in stakeholder management

will be reflected on within a third sector/shadow community context.

Sub-question 4: (BLUE)

Through a change in mindset, how can an awareness of processes facilitate an inclusionary stakeholder mapping strategy? Developing further on sub-question three, sub-question four, through the selection of a ‘what’

style question will explore the applicability of a change in mindset. The applicability will, firstly;

be examined through an identification and closer examination of how a change can be applied,

and the strengths and weaknesses of such a change. Secondly; expanding further on the

strengths and weaknesses of a change in mindset, a deliberation of the implications of such a

change will be carried out. The deliberation will be in the form of a discussion will address value

of a change in stakeholder management, taking into account communicative implications.

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4. Literature Review and Theoretical Concepts

The development of a solid theoretical foundation is

essential for an academic paper, and even more so

for a conceptual paper which depends on this

theoretical foundation. As such, in order to develop

the theoretical foundation from which the analysis

can draw, the purpose of this chapter is to review

literature on stakeholder theory and global

corporate citizenship. To establish the context of

the thesis, the third sector, more specifically non-

governmental organisations (NGOs) will be

introduced. To exemplify the role of an NGO, a

shadow community will be introduced as a

representation of a possible phenomenon which

intersects with the operations of an NGO. As

the Literature Overview illustrates (Figure 5),

Fig. 5. Literature Overview

while the theoretical aspects of the literature are reviewed separately, it is necessary to note that

the purpose is, firstly, to establish an overview of existing knowledge on the three theoretical

concepts so as to clarify the characteristics of each concept. Secondly, the literature review will

further define the accepted understanding of the theoretical concepts, which will then be

incorporated into a unified structure to represent the structural layering of the theory relative to the

thesis statement. The three theoretical aspects therefore represent the knowledge set upon which

the thesis is based.

4.1. Stakeholder Theory “Any group or individual who can affect or is affected by

the achievement of the organisation’s objectives”4

Freedman’s classic definition of a stakeholder as “any group or individual who can affect or is

affected by the achievement of the organization’s objectives” (Friedman & Miles, 2006:1), at its

broadest represents a redefinition of all organisations, that is how an organisation should be

conceptualised and what its activities should be (ibid.). This conceptualisation proposes a method

for the strategic management of an organisation (Mainardes, Alves & Raposo, 2011:226), an

interactive process between an organisation and its stakeholders. Expanding further, Clarkson

(1995) claims that the stakeholder concept contains three fundamental factors, namely the

organisation, other actors, and the nature of the organisation-actor relationships (ibid.:228). To gain

4 In: Stakeholders: Theory and Practice (Friedman & Miles, 2006:1)

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Third Sector

Stakeholder Theory

Global Corporate Citizenship

Thesis

deeper insight into the theoretical foundations of stakeholder theory, this section will address how

‘stakeholders’ and a ‘stake’ are visually represented and the theoretical underpinnings of this

representation.

4.1.1. The Nature of Stakeholder Theory Like the sociogram, Freeman’s visual representation attempts to identify relations and the

frequency of interactions between the organisation and individuals or groups (Fassin, 2009:114).

Fassin (2009:114) therefore proposes that Freeman’s (1984) attempt to define how stakeholders

are connected is possibly inspired by the social sciences method: the sociogram. Rapoport and

Horvath (1961:279) define a sociogram as a description of a population in terms of the relations

which exist between pairs of people in that population. These sociograms (Figure 6), which are

made up of web-link structures, are also known as

sociometric nets. Feld (1981:1016) explains that the

relevant aspects of the social environment, or node

(green), around which individuals organise their social

relations is the conceptual foundation upon which the

sociogram is based. The node can be further defined as

a psychological, physical, legal, or social entity around

which joint activities are organised (Feld, 1981:1016).

Rapoport and Horvath (1961:280) point out that the

probability of contact is not the same for every node and

as such joint activities are dependent on the contact Fig. 6. The Sociogram

structure of each node. Axones (blue & purple) which originate in each node represent the choices

available to individuals and form the point of interconnection between nodes. Feld (1981:1016)

elaborates that each individual within the sociometric net is related to or can be seen to relate to

some target nodes and not others. The strength of an axon, as Granovetter (1973:1361) explains,

is therefore a combination of the emotional intensity, the intimacy, amount of time, and the

reciprocal services which characterise the axon. Consequently, the social behaviour and the path

determined by the relevant sociometric net can be seen to characterise society as, according to

Rapoport and Horvath (1961:280), the social behaviour of the entire population is dependent on

such patterns of relations.

4.1.2. Defining Stakeholders and a StakeThe theoretical underpinning of stakeholder theory is that an organisation should be viewed as a

grouping of stakeholders who hold a ‘stake’ in the organisation, with the organisation’s purpose

being the management of stakeholder interests, needs, and viewpoints (Friedman & Miles, 2006:1).

According to Mainardes et al. (2011), stakeholder theory attempts to explain the relationship

between the organisation as well as its external environment and its behaviour within this

environment. The ‘stake’ held by a stakeholder may vary depending on the stakeholder’s level of

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involvement in the organisation (Cornelissen, 2008:42), and this in turn allows for a specific

stakeholder categorisation based on the ‘stake’ held. Friedman and Miles (2006:1) state that top-

level managers are positioned as the focal group and are tasked with fulfilling the role of

stakeholder management, ensuring the survival of the organisation while safeguarding the long

term ‘stake’ of each group. As such, managers are responsible for the definition and determination

of the extent of the ‘stake’ held by a stakeholder group. Corporate legitimacy requires that

management operates for the benefit of its stakeholders (Friedman & Miles 2006:1), thereby

recognising the legitimacy of the stakeholder’s ‘stake’ and the action/s taken by the organisation to

address a stakeholder’s claim or ‘stake’ in the organisation. It is through corporate legitimacy that a

‘group or individual’ and the extent to which they can ‘affect or is affected by’ the organisation is

recognised. Furthermore, ensuring the rights of this ‘group or individual’, as well as encouraging a

participatory process between the organisation and this ‘group or individual’, (ibid.), allows an

organisation to meet its moral obligation to ensure the rights and welfare of this ‘group or

individual’. Friedman & Miles (2006:1) expands further that the focal group, that is top-level

managers, therefore bear a legal or fiduciary obligation to the organisation and its stakeholders.

Friedman and Miles (2006) explain further that the indiscriminate use of the term ‘stakeholder’ over

the last two decades has resulted in no clear definition or understanding of what a stakeholder

actually is (Mainardes et al., 2011:228). This lack of a clarity and consistency, according to

Mainardes et al. (2011:227), in the use of the term ‘stakeholder’ has lead academics to criticise the

vagueness and ambiguity of stakeholder theory. An example of this vagueness and ambiguity is

evident in Friedman and Miles’ book “Stakeholders: Theory and Practice” where the authors

present seventy-five variations on Stanford Research Institutes original stakeholder definition of

“those groups without whose support the organization would cease to exist” (Friedman & Miles,

2006:5). Yet, as Mainardes et al. (2011) claim, despite the variations in how stakeholders are

defined, a large majority of researchers still adopt Freeman’s (1984) definition that “ individuals or

groups may influence or be influenced by the scope of organizational objectives”.

Authors such as Clarkson (1994, 1995), Donaldson and Preston (1995), Mitchell et al. (1997),

Rowley (1997), and Frooman (1999) have expanded on Freeman’s work, allowing for greater

theoretical depth and development of stakeholder theory and stakeholder management (Mainardes

et al., 2011:226). This theoretical depth however opens up for diverse points of view on how

stakeholders are defined and how their ‘stake’ is determined. Mainardes et al. (2011) explain that

the diversity in points of view is one of the most salient characteristics of stakeholder theory and a

possible contributing factor to the low level of theoretical integration of stakeholder theory.

Expanding further, Mainardes et al. (2011) state that despite the lack of a clear and consistent

‘stakeholder’ definition, researchers do however agree to a greater extent that organisations should

consider the impact of its polices and operations on the needs and interests of people and groups.

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4.1.3. Visual development of Freeman’s Traditional Stakeholder ModelMainardes et al. (2011:229) write that Freeman’s (1984) theory has emerged from an

organisational context where an organisation is perceived as dependent on the external

environment and groups external to the organisation. To visually illustrate this dependence on the

external environment, according to Mainardes et al. (ibid.), connections are characterised by bi-

directional links between the manager and stakeholders. Based on this dependence on external

groups and the bi-directionality of links between a

manager and stakeholders, Freeman’s original work

can be seen to find its roots in the traditional input-

output model of managerial capitalism (Mainardes et al.,

2011:229) (Fassin, 2009:114). Managerial capitalism

identifies four groups as being connected to an

organisation: suppliers, employees, shareholders, and

clients (ibid.). Expanding on the model of, managerial

capitalism, Freeman’s (1984) model (Figure 7) sees the

inclusion of; competitors, employees, customers,

civil society, suppliers, shareholders, and government (ibid.). Later work by Freeman (2003)

develops the original traditional stakeholder model further to include: NGOs, financiers, critics,

Fig. 8. Further Developmentby Fassin (2009)

environmentalists, others, and media.

Competitors are however omitted from this

later work (ibid.). As illustrated in Fassin’s

(2009:115) adaptation of Freeman’s (2003)

diagram (Figure 8), Freeman differentiates

between internal and external stakeholders

through the inclusion of a rectangular box,

where external stakeholders are positioned

outside the box and internal stakeholders

within the box.

Further work by Fassin (2009) proposes that a disentanglement of the confusion in existing

stakeholder terminology can be achieved through the introduction of a new terminology that

distinguishes between the categories of stakeholders and groups to which they belong (Fassin,

2009:121). This new terminology, according to Fassin, suggests the categorisation of stakeholders

according to stakeholders, stakewatchers, and stakekeepers (Figure 9). Stakeholders (yellow)

within the ring are stakeholders with a real positive and expected loyal interest in the organisation,

and the power and influence of the organisation dominate this stakeholder group (ibid.). Fassin

(2009:121) expands that this stakeholder group is “essentially the classic stakeholders in the

original narrow approach – those who have a concrete stake”. The second category,

stakewatchers (green), largely covers the business environment and have greater influence over

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Fig. 7. Freeman’s Traditional Stakeholder Model

their relationship with the organisation. Pressure groups “who do not really have a stake

themselves but who protect the interests of real stakeholders, often as proxies or

intermediaries” fall under this group

(Fassin, 2009:121). Fassin (2009:121)

elaborates that this category

“encompasses those stakeholders who

look after a stake with care, attention and

scrutiny, just as watchdogs do”. The final

group, stakekeepers (blue), further

removed from the rings represents the

organisation’s sphere of influence in the

wider environment of the social political

arena. Stakekeepers, according to

(Fassin, 2009:126) are even further

removed from real and active stakeholders. Fassin (2009:121), elaborates that this category

includes independent regulators who, while they have no stake in the organisation, have the power

to impose regulations and constraints on the organisation.

According to Fassin (2009:126), the Stake Model is better positioned to visually represent the

boundaries of the organisation and the three levels of an organisation, the business environment,

and the social political arena. Additionally, the Stake Model also represents the three economic

levels: the organisation at the microeconomic level, the broader economic community, and the

world on the macroeconomic level. Fassin (2009:128) therefore claims that through the inclusion of

minor changes which still respect the logical line of evolution initiated by Freeman’s original

stakeholder model and its subsequent adaptation, he is able to retain the cognitive strength of

Freeman’s original model.

4.1.4. Lépineux and Social CohesionStakeholder theory is a ‘weak’ theory according to Lépineux (2005:99) as existing stakeholder

theory fundamentally fails to appreciate the role of civil society as a stakeholder. Lépineux (ibid.)

expands that civil society should be positioned on top of the stakeholder list, thereby highlighting

the emergence of a global society distinct from national societies (Lépineux, 2005:126). Lépineux

(2005:106) views society as more than a mere collection of individuals unified together by an

organic bond where “society as a whole exists as a distinct reality, not reducible to the sum of its

constituents, and differing in its essence from all the peculiar communities that are formed within it ”.

As society can be viewed as a distinct reality, Lépineux reasons, it is appropriate to suggest social

cohesion as a normative justification for stakeholder theory. Social cohesion, while easily defined,

“primarily refers to society at large within the national framework, and points out the principle which

unites its members against all the dislocating forces that may threaten it” (Lépineux, 2005:106). In

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Fig. 9. Fassin’s Stake Model

other words, Lépineux (2005:108) claims that social cohesion is the cement of a country’s national

unity and what holds it together. Lépineux (ibid.) defines social cohesion as follows:

“A state of civil concord, which does not boil down to the absence of violent conflicts or

exclusion phenomena, but implies concern for others, an active will to maintain social

inequalities at a reasonable level, the implementation of solidarity mechanisms, and

provides everyone with the opportunity to blossom”

While Lépineux acknowledges that two meanings exist for social cohesion: namely the societal

meaning and the community-related meaning, it is proposed that there may be a third and broader

meaning, namely “social cohesion on a worldwide scale, between the north and south, between the

developed countries and the developing countries, between the centre of the system and its

periphery” (Lépineux, 2005:108). Consequently, social cohesion can be seen to apply at three

levels: the local level (communities), the national level (countries), and the global level (the whole

world) (ibid.). In addition to the differentiation between social groups or institutions, national

societies, and global societies, Lépineux (2005:108) claims that these three levels also correspond

to “the three types of belonging experienced by all individuals: being part of a social group, of a

nation and of mankind”.

4.1.5. Lépineux’s Society and Stakeholder TheoryLépineux (2005:100) theorises that the low level of integration of stakeholder theory is not

surprising as civil society’s place in stakeholder theory is unclear and ill defined. To support this

claim, Lépineux (ibid.) points out that Carroll (1991) includes ‘the public at large’ as a stakeholder,

but due to the vagueness of the expression, questions whether it means ‘nationwide society’ or

something else? Researchers such as Tichy et al (1997) and Altman (2000) confirm the complexity

surrounding community issues and the implications that this complexity places on organisations

and executives (Lépineux, 2005:100). Burton and Dunn (1996a) also comment on the term

community and the fact that communities are often associated with notions such as ‘general public’

or ‘natural environment’ (Lépineux, 2005:100-101). The aforementioned issues support Lépineux’s

claim that an agreed definition of ‘stakeholders’ and the meaning of ‘community’ in stakeholder

literature is still lacking, resulting in uncertainty.

In stakeholder literature, ‘community’ is quoted more often than ‘society’, and according to

Lépineux (2005:100), ‘community’ is understood as one of the numerous groups toward which an

organisation is supposed to act responsibly. The meaning of this term is however no more clear

than the term ‘society’. Lépineux (ibid.) expands that ‘community’ is generally used to indicate the

local community surrounding an organisation’s location. In the case of a multinational

organisations, Lépineux (ibid.) poses the question; “does it apply only in its home country or also in

all the other countries where it operates?”. A response to this question would require further

clarification on whether the community is a single ‘community’ (the community where the

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organisation’s headquarter is located), or multiple ‘communities’ (the organisation’s global business

environment). According to Lépineux (ibid.), the applicable expression would then be ‘communities’

as stakeholders, rather than ‘community’ in singular. Based on the view that civil society is a

fundamental stakeholder, Lépineux’s civil society is considered to be distinct from communities and

other specific groups and is defined as a “nationwide society, namely the nation itself, which is the

primordial meaning of this term” (Lépineux, 2005:101). Lépineux (2005:101) defines communities

as “local, neighbouring social groups, within a limited geographical area around a given facility or

establishment”. This distinction between ‘communities’ and ‘civil society’, according to Lépineux

(ibid.), “echoes the classical sociological separation between two levels of sociability: generic

sociability expresses life in society as such, specific sociability permits the constitution of limited

social groups”.

Lépineux, (2005:103) expands further that it is also necessary to differentiate between national

societies and global societies which can be considered from several standpoints: historical,

economic, financial, and technological. In addition to these three standpoints, Lépineux (2005)

believes that a further point of consideration is a sociological standpoint. The sociological

standpoint, which is the sociological process leading to the constitution of global civic actors, is

especially relevant today as business is increasingly conducted on a global scale, resulting in an

increase in the number of global civic actors. Lépineux (ibid.) notes that the emerging global

society “does not express itself through institutional devices such as governments, and there is no

such thing yet as a parliament for all the citizens of the world”.

4.1.6. Lépineux’s Extension of the Stakeholder Classification SystemStakeholder theory, Lépineux (2005:103)

hypothesises, ought to be extended, more

specifically to “systematic classification of

stakeholders, which encompasses global

society and distinguishes it from national

societies”. Lépineux (ibid.) sees this

classification as being defined in three ways.

The initial classification category, the binary categorisation stage (blue), Lépineux argues

that the separation between economic and

moral stakeholder interests may appear

somewhat arbitrary as it can be argued that all

stakeholder categories represent a

combination of economic and moral interests.

However, not only do the stakeholders

represent a combination of economic and

moral interests, they also represent social

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Fig. 10. The Organisation and its Stakeholders (Lépineux 2005)

interests as how an organisation responds to these social interests can have repercussions affect

its behaviour and have an effect on the organisation’s ability to maintain its licence to operate

(Lépineux, 2005:103-104). As such, Lépineux (2005:104) claims that economic and moral interests

are not adequate with respect to stakeholder classification, necessitating an alternative approach to

the classification process. Lépineux’s binary categorisation therefore proposes the differentiation

between societal stakeholder and business stakeholders.

Societal stakeholders are termed societal rather than social, firstly because “they are not limited

to social groups or institutions, but extend to national and global civil societies” (Lépineux,

2005:104). Secondly, “many of the social groups that are part of this category have stakes which

concern the whole society” and include for example the media and environmental activists (ibid.).

Business stakeholders are constituents who “have business relations or interests relating to the

concerned organisation” (ibid.). Lépineux (2005:104) claims that this clear distinction between

societal and business stakeholders is more convincing than current stakeholder theory as

stakeholder categorisation is either of the business type or societal type, without any ambiguity.

Lépineux’s second systematic classification, the intermediate taxonomy (yellow), retains the two

binary categorisations but subdivides this into three components under each binary category.

Societal stakeholders are comprised of; global society, national societies, social groups, or

institutions (Lépineux, 2005:104). Similarly, business stakeholders include shareholders, internal

stakeholders, and external business stakeholders (ibid.). The third and final classification draws on

binary categorisation and intermediate taxonomy and consists of the developed typology (green)

of the stakeholder spectrum. The main societal stakeholders are global society, civil societies,

host countries, local communities, international institutions, governments, etc. (ibid.). Similarly, the

main business stakeholders are shareholders, executives and managers, employees and workers,

trade unions, customers, suppliers, etc. (ibid.).

The interaction, which occurs between stakeholders, is visually depicted by arrows. Larger arrows

(A) connect the two binary categories: societal stakeholders and business stakeholders. The

smaller arrows (B) within the binary categories visually show the reciprocal links between the

organisation and its societal and business stakeholders, as well as among stakeholders

themselves. Lépineux’s visual depiction of stakeholders and stakeholder interaction allows for

effective stakeholder mapping. However an overview of the normative stream of stakeholder theory

suggests that there is little agreement on its normative foundation (ibid.). Lépineux (2005:105)

criticises these normative foundations, claiming that they are “not connected to the reality of

corporate behaviour and stakeholder expectations”. Lépineux (ibid.) believes that while the lack of

realism is a classic pitfall, this lack of realism does not indicate that “normative ethical conclusions

can be deduced from empirical data; rather that empirical findings can be incorporated in normative

theory building”.

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4.1.7. Section SummaryFreeman’s stakeholder model, which draws inspiration from the sociogram and managerial

capitalism, has over the last three decades guided managers in the mapping of stakeholders

according to how they can affect or be affected by the organisation. The web-like structural

framework represents the interconnected nature of individuals and how through points of

interconnection, or axons, these individuals connect with various nodes. These nodes thereby form

the nexus of the social network, which in the case of stakeholder theory is the organisation to which

the stakeholder is connected. Since the development of the stakeholder model in 1984, it has seen

a progressive adjustment in its visual representation, yet still retained its theoretical connection to

the sociogram and managerial capitalism. While this development has broadened the definition of a

‘stakeholder’ and opened up for debate on the benefits to be gained from its application, the extent

to which this development has been adapted to address the changes in societal and environmental

aspects can be questioned. Theorists Fassin and Lépineux, recognising the potential weakness of

Freeman’s traditional stakeholder model, have respectively proposed terminological adjustments to

how a stake is defined and structural improvements based on social cohesion. These

improvements, while they to a greater extent address societal and environmental aspects than

Freeman’s original work, the extent to which these improvements adequately address societal and

environmental aspects today is debateable.

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4.2. Corporate Citizenship

An organisation can be assessed on both an emotional and intellectual level. The intellectual level,

according to Seth, in Scherer & Palazzo (2008:74), is concerned with determining who has the

rights to exercise economic power and the notions of such possession of economic power. On the

other hand, Scherer & Palazzo (2008:74) expands that “economic institutions are evaluated in

terms of the fairness with which they acquire a society’s resources, that is, factors of production,

the way they distribute the resultant output and the exchange values they seek from those who

consume this output”. Subsequently, when considering the assessment process of these factors,

further challenges arise, namely within which theoretical context can an assessment of the process

be carried out? In order to address this question, it is necessary to develop an understanding of the

development of corporate citizenship (CC) and business-society relationships.

4.2.1. The Corporate Social Responsibility and Corporate Citizenship Debate

Corporate Social Responsibility (CSR) originated in

1953 (Valour, 2005:191) and finds its roots in the United

States (USA) (Scherer & Palazzo, 2008:53). Carroll

(1979), a major contributor to the field of CSR, has

developed the CSR Model (Figure 11) which, based on

a hierarchical structure, conceptualises four types of

responsibility: economic, legal, ethical, and philanthropic

(Matten & Crane, 2005:166) (Friedman & Miles,

2006:22). CSR initially took a managerial approach

(Geva, 2008:7), placing emphasis on an organisation’s

social conscience (Valour, 2005:191). Furthermore,

according to Sethi in Scherer and Palazzo (2008:75)

CSR was suggested as a necessary prerequisite in western societies for an organisation to gain

its social franchise. Scherer and Palazzo (2008:52) propose that CSR can be understood as an

attempt by the organisation to deal with discretionary and/or voluntary relationships with community

and societal stakeholders for the purpose of improving an important aspect of society or

relationship with communities or NGOs. Following on efforts by organisations in the mid-1990’s to

establish a good reputation through stakeholder engagement, Elkington’s 1994 work on the ‘triple-

bottom-line’ resulted in European publications calling this new behaviour not just CSR as the US

terminology would have it, but corporate citizenship (Scherer & Palazzo, 2008:51). Scherer &

Palazzo (2008:51) expand further that this approach implies a broader set of responsibilities related

not just to the deliberate (and largely voluntary) efforts by organisations to improve societies but

also to the way business is actually conducted.

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Ethical

Legal

Economic

Philanthropic

Fig. 11. Carroll’s CSR Model

Citizenship according to Crane et al. is defined as the rights and duties of a member of a country

(Andriof & McIntosh, 2001:14). This views organisations as independent legal entities and

members of countries, and as such hypothesises that organisations could be thought of as

corporate citizens with legal rights and duties (ibid.). Citizenship performance can however vary as

with individual citizens (ibid.). Peter Drucker (1993) claims that citizenship is more than a legal

term, it is a political term, and as such means active commitment. Drucker (1993) expands further

that citizenship means responsibility and making a difference in one’s community, one’s society,

and one’s country (ibid.). As such, Crane et al. (Scherer & Palazzo, 2008:28) state that according

to Waddell (2000), the focus of citizenship is “on rights and responsibilities of all members of the

community, which are mutually interlinked and dependent upon each other”. Crane et al. however

highlight the inconsistent use of the term CC, once again reiterating the need for a clear, specific

and widely accepted definition of CC (ibid.). The emergence of CC as a concept for dealing with

the social role of business, has become an important term in management literature and, according

to Wood & Logsdon (Andriof & McIntosh, 2001:86), the replacement in its use as ‘concept of

choice’ in business and scholarly literature.

4.2.2. The Rationale Behind Corporate CitizenshipCC, according to Waddock (Scherer & Palazzo, 2008.:52), carries many of the same implications

as CSR, which as an increasingly popular term is also the topic of much debate as the extent to

which an organisation can act as a citizen is a controversial one. For Wood and Logsdon (Andriof &

McIntosh, 2001:85), a possible cause of the controversy is the lack of a clear and precise

connection between the concepts of CSR and CC in scholarly work. Wood and Logsdon (ibid.), list

some of the areas of ambiguity between CSR and CC as including, firstly CSR as “a broad concern

for many issues and stakeholders, and society at large”, whereas CC’s focus is narrower with a

focus on the local community and charity. Secondly, CSR is described as obligatory and voluntary

realised through “tax payment and law abidance as well as discretionary problem-solving activities”

and can be “hard to operationalize, measure and evaluate”, whereas CC is “largely voluntary, often

with a corporate strategic focus” and is “limited and specific; easier to measure” (ibid.). Even so,

Waddock (Scherer & Palazzo, 2008:51) claims that while corporate responsibility can be seen to

be good practice, much resistance has been levied against fully putting it into practice. The

resistance may, however, be as a result of the lack of clarity which surrounds terminology

associated with the field.

As such, CC can be seen to have replaced CSR, and according to Sethi (Scherer & Palazzo,

2008:75), CC represents the totality of corporate actions, both in meeting legal and regulatory

mandates, but also in the satisfying expectation of an organisation’s important stakeholders and

community needs. Elaborating further, Sethi (Scherer & Palazzo, 2008:78) hypothesises that a

widely recognised reasoning of corporate conduct exists in economic theories where outcomes of

individual actions by an organisation and its stakeholders are determined through exchange

transactions. Crane et al. (Scherer & Palazzo, 2008:31) state that traditional political debates about

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organisations have focused on their role in the ‘inner circle’ of power (Useem, 1984) and on

pressure group activities, political donations, and lobbying (Grand, 1987; Lord, 2000). This

characteristic of the business-society debate, Crane et al. (ibid.) explain, is reflected in recent CC

literature where organisations have become more central in political and social analysis where

social critics point to an organisation’s responsibility for social and political ills (ibid.). As a result,

organisations are the product of and the solution to social and political ills evident in society today.

According to Crane et al. (ibid.), this double status as both the cause and the solution to issues is

based on necessity and need: the willingness of society to grant organisations the freedom to

achieve large-scale economic success and the fear of the power that accompanies this freedom.

4.2.3. A New Development PerspectiveResponsibility and how this is determined and managed is an essential part of CC and citizenship.

According to Marshall (1965), citizenship is the status that ensures that everyone is treated as

equal members of society. This status, according to Sethi (Scherer & Palazzo, 2008:74), is

historically the good organisation or the socially responsible organisation and has been

synonymous with large, highly successful organisations that may have done business globally but

had roots in local communities (ibid.). Today, however, somewhat different visions exist of an idyllic

organisation where market competitive efficiency is combined with stakeholder management to

achieve mutually beneficial outcomes (ibid.:75-76). CC therefore offers a framework within which

society and business relationships can be discussed. Waddell (2000:107) expands further that its

foundation centres on the dual concepts associated with citizenship, namely responsibility and

rights (Waddell, 2000:107). On the one hand, CC reinforces the view that an organisation is an

entity which holds a status equivalent to that of a person. This status however brings with it the

threat of equating human rights with that of an organisation’s rights (ibid.). Conversely, according to

Waddell (2000:107), this status connects business activities to service for mutual benefit and

broader social accountability, holding the promise of wealthier and healthier societies.

The mutual benefit and broader social accountability therefore also requires an awareness of all

spheres of society to ensure the engagement of society at large, including marginalised

communities. As such, Waddell (2000:111) emphasises that marginalised individuals, who exist

outside of the traditional social-economic-political power structure, require an inclusionary strategy

where individuals become actively engaged and influential in development processes. Waddell

identifies the World Bank Model as establishing a development framework. The World Bank Model,

according to Waddell (2000:110), makes reference to a CC model which aims for social,

economic, and political development. This model stresses the importance of partnership between

the organisation and the rest of society, an approach which is in contrast to traditional models

where either the organisation or government is responsible for the development agenda. In an

attempt to define development, Waddell (2000:111) cites the following definition:

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“…a process by which the members of a society develop themselves and their

institutions in ways that enhance their ability to mobilize and mange resources to

produce sustainable and justly distributed improvements in their quality of life

consistent with their own aspirations.”

For an organisation and its CC approach, it is necessary to address social-economic-political

power structures and the empowerment of partners (Waddell, 2000:111). This consideration, posits

Waddell (2000:111) requires an understanding of sectors not as industrial sectors but rather

organisational sectors (business, government, and civil society) each with its own dominant

structural forms, assets, strengths, and core competencies. The first sector, government and its

agencies form the ‘state’ sector is considered the political sphere which is responsible for the

implementation of laws or regulations, their enforcement leading to rigidity (Waddell, 2000:111-

112). The second sector, market, incorporates for-profit businesses and is considered the

economic sphere where business or public interests are the area of focus. These public interests,

Waddell (2000:111) expands, if left unchecked can potentially lead to an organisation monopolising

the market. Finally, civil society, that is community based organisations or NPOs are considered

the social sphere which incorporates activities that benefit society.

The key organising challenge according to Waddell (2000:112) is the creation of outcomes that

both mobilise the development issue and promote participation of organisations. In order to achieve

this, it is necessary to create “institutions and processes that can access each sector’s strengths,

resources, and competencies, and yet alleviate its weaknesses, short-comings and failures”

(Waddell, 2000:112). The CC framework therefore, as Waddell (2000:121) explains, highlights the

need for long-term corporate commitment, this commitment coming at a time when an

organisation’s operating environment in increasingly sensitive to changing market conditions and

rapid staff turnover (Waddell, 2000:121). Consequently, relationships must be embedded in

corporate culture and figure consistently in strategy planning if relationships are to be more than

short-lived individual commitments.

4.2.4. Section SummarySociety’s willingness to grant organisations the freedom to achieve large-scale economic success

brings with it the fear that this power will negatively affect society. Through CC, an organisation

attempts to ensure society of its commitment to meeting legal and regulatory mandates, while also

satisfying the expectations of significant stakeholders and the community. Crane et al. however

highlight that the term CC is applied inconsistently in literature, this fact supporting the need for a

clear, specific, and widely accepted definition of the term. Waddell acknowledges this inconsistent

use of the term and proposes that responsibility and how it is determined and managed is a

necessary consideration. This consideration by Waddell has led to the proposition of a

development model which directs attention to societal, political, and environmental aspects as well

as long-term corporate commitment.

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4.3. The Third Sector “If business is so powerful, and is now doing so much good;

why is so much wrong in the world” 5

Private and public sector activities traditionally characterise the business environment. There is

however a less known or acknowledged sector which exists in the ‘gap’ between the private and

public sector: the third sector (Salamon & Anheier, 1992:311). The third sector, also known as the

voluntary sector, or nongovernmental organisations, operates as within the grey areas of society

(Salamon & Anheier, 1992:311) and in response to failures in the business environment. The

response to these failures is addressed by nonprofit (NPO) and nongovernmental (NGO)

organisations in close collaboration with local governments on projects which play an important role

in the development of local activities, even in instances where a central government has weak links

with NGOs (Clark, 1995:594). This close interaction therefore requires an understanding of the

third sector and what characterises it. In order to develop an understanding and awareness of the

third sector, it is necessary to present an overview of an organisation and exemplify one such

activity that characterises the sector. For that purpose, the United Nations (UN) has been chosen

as a global NGO that addresses phenomena which are caused by social inequality and structural

irregularities. Furthermore, a Shadow Community which is an example of a society is the result of

social inequality and structural irregularities and exists in the ‘gap’ between the private and public

sector.

4.3.1. The Third Sector Theories on NPOs address primarily the “why” question, that is their origins and the institutional

choices involved (Anheier, 2005:120), the answer to this question thereby establishing the purpose

and means of the organisation. This question also leads to expectations about the organisation’s

behaviour and impact and leads to insight into the role of NPOs more generally (ibid.). In an

attempt to develop a theoretical foundation for the third sector, a number of authors have

developed economic, sociological, and political science approaches which address the origins,

behaviour, and impact of non-profits (Anheier, 2005:113). An example of one such theory is

Weisbrod’s (1978) Public Good Theory which attempts to explain the existence of NPOs (Anheier,

2005:120) and sees the resolution to the public good problem as a collective action by the

individuals affected (Anheier, 2005:121). Weisbrod (1997:542) claims the public good theory as an

alternative mechanism for providing collective services. Ben-Ner and Van Hoomissen however

argue that a heterogeneous society is not sufficient, it is necessary that stakeholders who are

concerned with the public good assume control over the production and delivery of public goods

(Anheier, 2005:123). A consideration of stakeholders who care, according to Anheier (2005:123),

requires common preferences which are distinct from those of government or market interest in

order to create social cohesion for the development of an operational context of NPOs. Weisbrod’s

theory therefore offers other theorists a model to build upon, and as Anheier (2005:123-124) 5 Oded Grajew, President, Instituto Ethos (in: Zadek, 2001:1)

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elaborates, Weisbrod argues that as donors ‘vote’ with their financial support, an individual’s vote is

a good indicator of the public’s demand for public good not provided by government.

As such, as NPOs and NGOs are closely interwoven in the fabric of society today and exist as the

result of failures in the business environment, they play an important role as mediators between the

public and private sector as well as the marginalised communities. Due to the close ties to

marginalised communities, NPOs and NGOs can be seen to act as representatives for these

communities and, as Clark (1995:593) claims, help these communities gain a more powerful voice

in the decision making and the resource allocation process. These resources are additional to

developmental assistance and not only attempt to fill the gap but are in response to the failures of

the public and private sectors (Clark, 1995:595). In an attempt to address this gap, local

governments and NGOs enter into partnerships which can influence government policies and

practices and can have a pivotal role in the capacity of an NGO to operate and grow (Clark,

1995:595). An NGO’s role, according to Clark (1995:596) is often described as providing

‘development alternatives’, a term which can be misleading as marginalised communities do not

have the luxury of choice between what the government and NGOs offer.

A healthy state-NGO relationship, as Clark (1995:595) explains, is only possible when a common

objective is shared by both parties. Clark (1995:593) elaborates further that as marginalised groups

are rarely the target of infrastructure and service delivery, regulations, and market mechanisms, it

is necessary that a participatory approach is development. A further point in addition to the need for

a participatory approach is awareness that NPOs and NGOs have several bottom lines. Anheier

(2005:227) claims that these bottom lines are a result of the absence of price mechanisms to

combine interests of volunteers, clients, staff, and other stakeholders, “and to match costs to

profits, supply to demand, and goals to actual achievements”. Consequently, due to numerous

accountabilities to donors, the required standards of professionalism, internal standards of

governance, and the beneficiaries (Walker & Maxwell, 2009:2), NPOs and NGOs have multiple

accountabilities to address.

4.3.2. United Nations and Shadow CommunitiesThe United Nations (UN) which is made up of 192 Member States is committed to a broad range of

issues ranging from sustainable development to human trafficking6. The latest estimates from the

International Labour Organisation covering the period 2002-2011 estimate 20,9 million exploited

individuals on a global level (Attachment 4) These incidents of trafficking have a social and

economic impact on, for example, healthcare and legal systems in destination countries. According

to the Global Report on Trafficking in Persons (2009), human trafficking is a knowledge crisis which

requires that a deeper degree of understanding is created. In response to the increase in human

trafficking, the United Nations Convention against Transnational Organised Crime was adopted on

15 November 2000 and entered into force on 25 December 2003. In line with the UN’s work on

6 http://www.un.org/en/aboutun/index.shtml (Accessed 23 December 2013 at 20:35)

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combating human trafficking, global initiatives have been launched under the auspices of UN

divisions such as the United Nations Office of Drug and Crime (UNODC) and United Nations

Global Initiative to end Trafficking (UN.GIFT). Through industry partnerships and partnerships with

local and national aid organisations, the UNODC and UN.GIFT are active globally. These initiatives

aim at mobilising state and non-state actors to eradicate trafficking by reducing both the

vulnerability of potential victims and the demand for exploitation in all its forms.

Shadow Communities 7 Due to the earning potential of trafficking, global trafficking networks have been established and

existing networks expanded. In an attempt to curb this phenomenon, governments and NGOs have

become active in attempts to address this forced migration to meet the demand for trafficked

women. Traffickers have been known to use a process of forced migration. While these measures

by governments and NGOs can be seen to have achieved a measure of success, traffickers

continue to successfully operate clandestinely. The success of these clandestine networks is

potentially made possible by alliances and flexible networks which make is possible for the

networks to disperse and reassemble with speed and ease (William, 2008:139). The fact that the

phenomenon operates outside of legitimate social and economic channels makes it difficult to

measure the extent to which traffickers benefit financially, or to measure the exact number of

trafficking victims in destination countries. The clandestine nature of this phenomenon forms part of

the tactic of social control which characterises a shadow community, a characteristic which

reinforces the spatial power tactics which traffickers employ to contain victims of trafficking.

Through social isolation and power tactics, traffickers maintain the structure and social construction

of a shadow community.

As a shadow community exists within a context of illegality, the structural and discursive borders

which make up this community are not clearly defined and visible to individuals who exist outside of

a shadow community. However, internally this community is characterised by well-defined and

interconnected power structures which are maintained by the traffickers. This structural irregularity

of a shadow community is therefore held together by an organic bond which can transcend

numerous societal layers, yet have no clearly defined beginning or end. Consequently, a shadow

community exists alongside of an existing traditional community structure and due to its fluid nature

has the flexibility to regenerate and relocate itself and the individuals who exist within it with relative

ease; hence the term ‘Shadow Community’

4.3.3.Section SummaryPrivate and public sector activities traditionally characterise the business environment. Yet a less

acknowledged sector operates in the gap between the private and public sector, and has as a

result become closely interwoven in the fabric of society today. The purpose of the third sector is

therefore to provide these marginalised communities with a more powerful voice in decision making

7 Attachment 3 (Shadow Communities )

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and resource allocation processes. Traditionally, NPOs and NGOs are seen to operate in this grey

area of society, and through a process of mediation between marginalised communities and public

and private sector they attempt to address the needs associated with social inequality and

structural irregularity. As such, through a focus on collective agency, these organisations have

multiple accountabilities in their attempts to meet the needs of marginalised communities.

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4.4. Sub-conclusion

Business and society relations in the 21st

century have resulted in a social divide

which is characterised by, for example,

societies which exists in the shadows of

traditional societal structures. In an

attempt to address this social divide, CC

and stakeholder management present a

theoretical framework for identifying and

managing business and society

relationships. CC activities which guide

an organisation’s attempt to act

responsibly and generate value for both

the organisation and society, can be

seen to acknowledge an organisation’s

commitment to the legal and regulatory

mandates set by society. Stakeholder

management, the identification of

stakeholders according

Fig. 12. Balancing Theory and itsApplication

to their stake, allows for a visualised representation of the stakeholders that can affect or be

affected by an organisation’s CC activities. This visualisation, which takes the form of a web-like

structure, has however remained relatively static in its design since its development. The static

nature of this design and its ability to adequately represent society’s stake requires consideration.

This ability to adequately represent society’s stake is an important factor especially where NPOs

and NGOs have become closely interwoven in the fabric of society and act as mediators between

society and the public and private sector. The purpose of these third sector organisations is

therefore to provide society and marginalised communities with a more powerful voice in decision

making and the resource allocation processes.

As such, the theoretical underpinnings of stakeholder management and CC, in an environment

which is characterised by social inequality and structural irregularity as well as societal and

environmental dynamism require a theoretical foundation that acknowledges the dynamic nature of

business-society relations in the 21st century. Stakeholder management and CC, through a focus

on ‘stakeholders’ and ‘responsibility’ can be seen to provide a theoretical framework from which to

draw inspiration when strategizing and developing communication processes which are directed

toward third sector initiative. However, as illustrated in Figure 12, it is essential that a balance is

created between theoretical underpinnings and the applicability of these in the context of the

phenomenon in which the theory is to be applied. Consequently, it is necessary examine closer the

theoretical underpinnings in relation to the phenomenon under investigation.

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Third Sector

Global Corporate Citizenshi

p

Stakeholder

Theory

Theoretical Concepts

Practical Application

5. Analysis

The following section will present a closer examination of the theoretical concepts addressed in the

Literature Review in order to establish the basis for the discussion. Through a logical progression

through the analysis, possible theoretical strengths and/or weaknesses will be considered in order

to determine the potential for further development on the theory included. In order to guide the

reader through the analysis, Figure 13 has been developed. The purpose of this figure is to visually

support the potential development of the new theoretical approach which will be brought forth in the

Discussion (Chapter 6).

Fig. 13. Analysis Progression

5.1. The Structural Foundation of Stakeholders

The determination of the structural foundation of stakeholder theory requires an understanding of

the guiding principles upon which the theory is based. Stakeholder categorisation is achieved

through the determination of a stakeholder’s ‘stake’ (Section 4). This stake is then represented in a

stakeholder map, which provides insight into the grouping of stakeholders. However, in order to

determine the validity of such a visual illustration, it is necessary to examine closer the guiding

principles upon which stakeholders are visually represented. As such, as Figure 13.a. points to,

Section 5.1. will address the visual foundation of the mapping of stakeholders.

Fig. 13.a. Analysis Progression

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Sociological Foundation

Stakeholder Foundation

Ethical Development

Redefining Stakeholders

Potential for a Change in Mindset

Applying a Change in Mindset

5.1.

5.2. 5.3. 5.4. 5.5.

Sociological Foundation

Stakeholder Foundation

Ethical Development

Redefining Stakeholders

Potential for a Change in Mindset

Applying a Change in Mindset

5.1.

5.2. 5.3. 5.4. 5.5.

5.1.1. Structural Foundation To understand patterns in social networks, an examination of the following is necessary: 1) the

sociological nature of the focus, 2) the distribution of individual relations to foci, and 3) the degree

to which foci organise social interaction among individuals (Feld, 1981:1018). While it is

acknowledged that foci produce patterns of ties (ibid.), an important consideration is that similarities

do not necessarily lead to concentrated interaction (ibid.:1019). The fact that interaction can exist

independently from similarities is necessary especially as social structures have become more

dynamic due to globalisation. As a consequence, the possibilities exists that individuals can share

similarities such as the same social conditions or have the same physiological or sociological

needs yet are geographically separated due to globalisation.

Freeman’s stakeholder model draws inspiration from sociological sciences. When considering that

inspiration has been drawn from sociological sciences, it is also necessary to reflect on the

potential weaknesses that may result from such a comparison. As pointed out by Feld’s (1981)

article, ‘The Focused Organization of Social Ties’, “the study of social networks has often been

carried out without concern for the origins in the larger social context” (ibid.:1015). Feld explains

further that the result of this lack of concern for the larger social context results in most network

analyses ending with the description and labelling of patterns which, when explanations are

offered, rely on “inherent tendencies within networks to become consistent, balanced, or transitive”.

This concern by Feld draws attention to the extent to which the social context has developed from

a more localised social context to a multi-faceted global social context. This is important to note as

whereas earlier societies were easier to localise and define, today’s global communities are

characteristically multi-dimensional. The implication of the dynamic nature of individuals and

society is therefore evident in the multi-dimensionality of communities and social structures. This

multi-dimensionality of communities and the mobility of individuals can be seen to support a shift in

social structures. This shift requires a reassessment of the structural principles which traditionally

guide research and theory on social factors.

Freeman’s stakeholder model can also be seen to draw inspiration from the traditional input-output

model of managerial capitalism (Fassin, 2009:114) (Section 4), which acknowledges the strategic

importance of and role of suppliers, employees, clients, and shareholders. A further structural

consideration according to Mainardes et al. (2011:229) is that Freeman’s stakeholder theory is also

understood to have emerged out of an organisational context. An organisational context, according

to Pfeffer and Salancik (Mainardes et al. 2011:229), is perceived as not being self-sufficient and

therefore dependent on the external environment which is made up of groups external to the

organisation. The dependence on an organisation’s external environment can be seen to support

the capitalist managerial foundation upon which Freeman draws inspiration. It does however also

support an organisation’s centric approach to determining stakeholders.

The analogies that Freeman’s stakeholder model draws, while allowing managers to determine

who an organisation’s stakeholders are, unwittingly also launches a pre-defined graphical

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representation of how stakeholders should be visually depicted. The dilemma then is that

managers are unconsciously bound by a contextual understanding of how stakeholders are

categorised and the extent to which stakeholders can affect or be affected. A further concern is that

there appears to be a lack of consensus in the numerous theories on stakeholder management on

how stakeholders and a stake are defined. However, despite the lack of a clear definition of a

stake, the graphical representation of stakeholders remains consistent: Freeman’s traditional

model. Fassin (2008:882), citing Jansson (2005), elaborates further that managers form the focal

group who enters into contractual relationships with most or all stakeholders. Goodpaster (1991)

points out that this central position of managers is paradoxical (Fassin, 2008:882) as through the

central placement of managers, conflicting interests can arise. The paradox is therefore that

managers manage the interests of the organisation while simultaneously serving as mediator

between the organisation and its stakeholders. Winn (2001) adds that managers are therefore both

identifier and interpreter and thus a crucial mediator of stakeholder influence (ibid.). The implication

of this dual role of managers is that it can affect how stakeholder requirements are identified and

met.

In order to address the question of responsibility, it is necessary to examine closer the interaction

between the organisation and its stakeholders. Fassin (2008:880) suggests that as the organisation

is the focal point of Freeman’s stakeholder model, the impression is created that the stakeholder

has a relationship with the organisation. This is however not the case as, in reality, the stakeholder

is in fact dealing with a representative of the organisation: management (Fassin, 2008:880). A

question that can be raised, however, is that if managers are responsible for determining and

allocating resources, what considerations are drawn upon when assessing the needs of dynamic

stakeholder groups? Moreover, can existing changes to the structural design of the stakeholder

map facilitate dynamic groups? As Hill and Jones (1992) (ibid.:882-883) explain, a manager’s

responsibility is therefore the allocation of strategic resources in the most consistent manner so as

to meet the claims of stakeholder groups.

5.1.2. Stakeholder Maps and the 21 st Century Since Freeman’s traditional stakeholder model and the numerous iterations of this model has

undergone, the visual representations as presented by Freeman and Fassin have consistently

retained the organisation as the focal point of a web-like diagram. Through a consideration of and a

recognition of the role of responsibility, while Fassin’s Integrated Model may offer a possible

solution to the structural weakness of the traditional stakeholder model, a consideration of the role

of responsibility is still necessary. Fassin (2008:885) poses the question: “Do stakeholders have

responsibility for the corporation and responsibilities for other stakeholder?”. This question is

particularly relevant when examining how ‘stakeholders’ and ‘stake’ are addressed in the 21st

century. In an attempt to address the structural weakness of Freeman’s stakeholder model, Fassin

proposes a closer examination of stakeholder terminology. While Fassin’s Stake Model (Section 4)

offers a more nuanced overview of each specific situation, the question still remains: to which

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extent does this overview reflect a contextual representation of environmental factors that can

influence the overall applicability of the stakeholder model? The weakness of the stakeholder

model, in Fassin’s (2009:113) opinion, is the inherent flexibility of stakeholder theory and the mixing

of two interpretations (managerial/legal dimension) which results in ambiguity and vagueness

surrounding stakeholder identification and organisational boundaries. The strategic dimension

distinguishes between definitions with a high strategic effect that limit stakeholders to those that

can affect or are critical to the survival or existence of the organisation. On the other hand, legal or

institutional conditions may force an organisation to deal with stakeholders through, for example,

implicit or explicit contracts. Fassin (2009:126) sees his Stake Model (Figure 9) as eliminating the

vagueness and ambiguity surrounding stakeholder identification and as providing a means of

visualising an organisation’s boundaries and the three levels of an organisation: the business

environment, the social, and political arena. Fassin (2009:128) believes that Freeman’s (1984)

strategic view, which represents stakeholder theory as a managerial tool and closely connected

with the practice of business and value creation, can be restored by defining the organisation’s

boundaries and the use of an integrated visualisation of stakeholder categorisation.

5.1.3. Section SummaryDespite three decades of development, Freeman’s stakeholder model has consistently retained its

web-like structure albeit with minor adjustments to the principles upon which the visual

representation of stakeholders is based. Later work by Fassin attempts to offer a more nuanced

overview of stakeholders through a refinement of Freeman’s stakeholder model. This refinement by

Fassin’s replaces the organisation with management as the focal group. While Freeman’s

stakeholder model acknowledges management’s central role, the nexus of the model is however

still referred to as the ‘organisation’. Fassin however claims that in order to determine

responsibility, it is necessary to identify management as the nexus of the stakeholder map. The

structural design of Fassin’s model nevertheless remains basically unchanged from Freeman’s

traditional model, which supports the claim of cognitive strength of the traditional stakeholder

model. Consequently, the static design and consistent use of the structural format of Freeman’s

stakeholder model can be seen as a potential weakness. This potential weakness is due to a lack

of differentiation, an aspect which can potentially affect how stakeholders and their stake are

determined in the 21st century.

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5.2. Ethical Development - Corporate Citizenship

Marsden and Andriof (1998) state that good CC can be defined as understanding and managing an

organisation’s wider influence on society for the benefit of the organisation and society as a whole

(Andriof & McIntosh, 2001:14). The recognition of these benefits by an organisation and society as

a whole requires an acknowledgment of the rights and responsibilities and the impact of these, for

both business and society. Developing further on Section 5.1., the ethical development of an

organisation will be examined. As illustrated, (Figure 13.b.) Section 5.2. will establish the ethical

framework upon which the potential for a change in mindset will be drawn.

Fig. 13.b. Analysis Progression

5.2.1. Ethical Considerations and Implications of Corporate CitizenshipTo develop business-society relationships which are based on an organisation’s moral commitment

requires a licence to operate (Section 4). This licence to operate is an agreement between

business and society with national laws being the embodiment of a society’s standard for ethical

corporate conduct (Kline, 2010:13). Expectations regarding desirable corporate behaviour, which

are derived from the social contract, presumably include legal requirements which are prone to

change (ibid.). While these laws may embody a society’s standard for ethical corporate conduct, a

consideration is what the potential implications of this conduct are in a country where laws do not

represent an individual’s human rights or where there is a gap between society and the state. The

implication of such conduct can be agreements between an organisation and the state which do

not benefit society. An awareness of an organisation’s impact, and the implications of this, is

therefore a necessity and require an understanding of the expectations, rights, and responsibilities

of individuals and organisations.

Donaldson and Preston (Valour, 2005:201) claim that an organisation must acknowledge that the

interests of stakeholders are of intrinsic value and should behave accordingly. However, individuals

and organisations whose wills and desires diverge can make it difficult to reach agreement

(Buchholz, 1996:449). The inability to reach agreement can harm business-society relations and

also be detrimental to individuals or groups whose ‘stake’ has not been recognised or adequately

addressed. Individuals or groups most likely to be affected by an inability to reach agreement are

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Sociological Foundation

Stakeholder Foundation

Ethical Development

Redefining Stakeholders

Potential for a Change in Mindset

Applying a Change in Mindset

5.1.

5.2. 5.3. 5.4. 5.5.

individuals who exist in the shadows of society and, it is these individuals who are the concern of

third sector organisations.

International organisations, which actively operate as part of the global economy, are essentially

governed by national laws within the countries in which they operate (Kline, 2010:14). The absence

of international laws which govern global business has resulted in a possible gap in the legal

system. This gap in international law according to Kline (ibid.) is due to a lack of consensus among

national governments on fundamental societal objectives to support accepted conduct standards

which are mutually agreed on and will hold up in an international court of law. The absence of an

agreed and enforceable legal standard according to Kline (2010:15) results in a decision making

process which opts for the ‘best’ action under the circumstances rather than the ‘right’ one. This

dilemma poses an ethical dilemma for an organisation as whose responsibility is it to decide what

the ‘best’ action is: business or society? An inability to reach consensus on what the right action is

in cases which involve global crime or social inequalities or structural irregularities can therefore

result in loopholes which create a potential gap in a state’s or NGO’s ability to adequately address

the requirements of marginalised communities.

5.2.2. The Role of Responsibility in Corporate Citizenship Valour (2005:195) states that the aim of CC is to highlight that organisation are powerful public

actors with a responsibility to respect the rights of real citizens in society. The role of CC therefore

requires an awareness of the extent to which an organisation is responsible for meeting ethical,

economic and legal responsibilities (Section 4). But, who is considered a ‘real’ citizen, and how

does Valour classify a ‘real’ citizen? Furthermore, how does a further static visualisation of an

organisation’s area of operation aid an organisation, especially in stances where an organisation’s

operation can affect individuals but is not immediately visible to those developing the strategy?

Waddell (2000:111) emphasises that the need exists for an inclusionary strategy where people

become influential and actively engaged in the development process. The need for such an

inclusionary strategy is no more evident than in the case of the social inequalities and structural

irregularities which increasingly characterise the 21st century. Waddell’s (2000) comment supports

the need for a process based on inclusionary principles. Inclusionary principles, according to Crane

et al. (Andriof & McIntosh, 2001:15-16), see an organisation’s responsibility as one that embraces

an understanding and acknowledges that an organisation’s activities have a follow-on effect both

inside and outside the organisation. As such, to address responsibility and determine

accountability, it is necessary to have a clear overview of the stakeholders involved and their roles.

Accountability on the part of an organisation requires the advancement of the common good, and

this should infiltrate every sphere of an organisation’s activities (Valour, 2005:201). In order to

determine accountability an understanding of who has responsibility or is responsible for what is

needed. Stakeholder management provides the managerial tool with which an organisation

identifies its stakeholders, this identification process aided by an understanding of the

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organisation’s environment and strategies. A point to note however is that these aspects need to

be addressed at various levels, including but not limited to industry sector, company type, local and

national considerations; considerations which expand exponentially depending on the reach of the

organisation. The determination of responsibility and ultimately accountability therefore requires a

process which allows for the continual determination and assessment process while simultaneously

acknowledging the dynamic nature which characterises today’s global economy and society.

An organisation’s ability to address its environments dynamic nature is an important aspect and

one which requires attention. However, the extent to which CC allows for dynamism in its area of

responsibility requires consideration, especially as current visual representations present static

visual illustrations of the areas of responsibility, for example Carroll’s pyramid shaped CSR Model.

Traditional CSR and CC theories visually illustrate spheres of influence and factors requiring

consideration as a one dimensional representation. However, can a static visual illustration, which

offers a one dimensional overview of a context, adequately portray an environment which is

characterised by dynamic processes? These processes are characterised by an unpredictable

global economy, political structures which can have a history of instability, and uncertainty created

by a legal system which is not adequately equipped to deal with business in a global economy.

A visual change is therefore proposed. This change is

from a static representation of an organisation’s sphere

of activity to an illustration which allows for a dynamic

visualisation of the interconnectedness of the

economic, political, and social spheres of global

business and influence. This visual change allows for

better determination and definition of areas of

responsibility. Through the use of the Organisational Sphere of Activity (Figure 14), a dynamic visual tool

is presented that graphically illustrates the iterative

process/processes which characterise business and

society in the 21st century. Through a consideration of

these aspects, attention can be drawn to the

Fig. 14. Organisational Sphereof Activity

interconnected nature of today’s environment which can ensure that all necessary political, social,

and economic spheres of influence are taken into account. The replacement of the traditional visual

illustration of an organisation’s operating environment and areas of responsibility will therefore

allow for a convincing overview of how organisational and societal factors are interrelated.

The points of overlap, where the three spheres converge (red ring), represents the point of

convergence where the iterative process of context development continues on to a further loop of

context development. The need for continual context development is supported by Crane et al.

(Scherer & Palazzo, 2008:44) who claim that corporate responsibility in the field of citizenship is

fundamentally contestable as citizenship is a dynamic concept, and organisations do not fit easily

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within a single political role. This dynamic illustration therefore exemplifies the iterative process

(black arrows) through which an environment is affected, and an organisation and stakeholders can

affect and be affected by this process. The visually interactive process visualises the

interconnectedness of factors which require consideration, the interconnectedness of these factors

thereby broadening the understanding of processes which characterise an organisation’s

environment. Consequently, this understanding facilitates the determination of areas of

responsibility and can potentially aid an organisation’s ability to develop strategies.

5.2.3. Section SummaryThe expansion of business-society relationships in the 21st century has resulted in a greater social

demand for ethical business practices. These practices require the determination of stakeholders

and areas of responsibility, both within an organisation but also within society. There is, however,

a lack of clarity surrounding the definition of ‘responsibility’ according to existing literature, an

aspect which can affect an organisation’s ability to identify and assign areas of responsibility. In an

attempt to address the traditionally static determination of an organisation’s area of responsibility,

the Organisational Sphere of Activity has been developed to allow for the iterative nature of

environmental factors which characterise business and society in the 21st century.

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5.3. Redefining Stakeholders

Developing further on the structural development of stakeholder theory and the resulting visual

representation of this, with consideration given to how ethical considerations have resulted in a

process through which an organisation’s responsibility is identified, it is necessary to examine

closer how existing stakeholder and society considerations can be improved to allow for a more

inclusionary approach to the mapping of stakeholders. This examination can potentially allow for

the redefinition of stakeholders.

Fig. 13.c. Analysis Progression

To address the lack of clarity surrounding an organisation’s area of responsibility, from a

geographic perspective, it is necessary to develop an understanding of how societal structures are

categorised. A traditionally accepted understanding of

community structure is local, national, and

international (Figure 15). Building on this traditional

view of community structure, business strategies have

traditionally been categorised as either, or a

combination of, local, national and international.

Furthermore, each sphere of operation has been

tailored to address area specific considerations during

an organisation’s strategy process. Much discussion

however surrounds the definition of civil society and

community, and at times the two are used

interchangeably.

Fig. 15. Traditional Community Structure

5.3.1. Community vs Civil Society in a Stakeholder Context In order to clarify the uncertainty surrounding the understanding of community and civil society

(also known as national society), Lépineux (2005) proposes a clarification of how community and

civil society differ (Section 4). Lépineux’s (2005:101) clarification sees civil society as a stakeholder

per se, distinct from communities and other specific groups, this differentiation visually illustrated in

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Local

National

International

Sociological Foundation

Stakeholder Foundation

Ethical Development

Redefining Stakeholders

Potential for a Change in Mindset

Applying a Change in Mindset

5.1.

5.2. 5.3. 5.4. 5.5.

Figure 16: organisation (red), community (green), and civil/national society (purple). Lépineux’s

distinction between community and civil society to a higher degree reflects the sociological

foundation upon which Freeman (1984) bases his

stakeholder theory. A point of consideration though is that

moral interests allow for the inclusion of civil society

based on a moral claim whereas economic interests

generally do not allow for the inclusion of civil society. As

such, Lépineux (2005:101) points to the failure to

recognise the importance of civil society and the

relegation of this society to a subordinate or incidental

position, thereby failing to recognise civil society as a

fundamental stakeholder. Lépineux (ibid.) expands further

that without recognition of society, stakeholder theory is

incomplete. Furthermore, when one considers

globalisation and the social divide that is being created by

Organisation

Community

Civil / National Society

Global

Fig. 16. Visual Representation of Lépineux’s Distinction between

Community and Society

this phenomenon, global organisations can be seen to have accumulated great social powers. The

accumulation of this social power, according to (Lépineux, 2005:102), has resulted in an

expectation by civil society that an organisation should act responsibly and help to reduce the

social divide that is being created.

A further differentiation between societies exists: national versus global societies (Figure 17).

Lépineux (2005:102) expands that organisations are the main social and economic actors, and that

their collective activities have an effect on a national society. This effect is evident as social

institutions such as organisations fulfil the role of employer, employing the largest part of the labour

force (Lépineux, 2005:102). In addition to its role as employer, an organisation’s choice of strategy

can influence the fate of societies in which they

operate (ibid.). While Lépineux makes a valid point

that an organisation’s strategy can affect societies, an

important consideration, which also needs to be

addressed, is the industry sector in which the

organisation operates, that is public, private, or third

sector. The reason for this consideration is that each

sector will have sector specific goals around which

strategies are developed. For example, an NGO will

base its strategies on seeking the best possible

outcome for the charities or marginalised communities

they are committed to aiding. The ability of an NGO to

meet its commitments is however placed under

Fig. 17. Visual Representation of Lépineux’s Distinction between National

and Global Society

pressure when, as Lépineux (2005:102) claims, today’s economic system produces more and more

inequalities which result in an economic system where a divide exists between those who benefit

from it and those who do not. The economic system, which has a national effect, also characterises

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Organisation

Community

National Society

Global society

the global society as an organisation’s local business environment can be interconnected with the

societies of all the countries in which it operates.

5.3.2. Traditional Stakeholders vs Lépineux’s Social Cohesion Through recognition of society as more than a mere collection of individuals where society exists

as a distinct reality bound together by an organic bond, society can be seen as social cohesion on

a worldwide scale (Section 4). As such, Lépineux (2005:108) sees social cohesion as applying on

the local, national, and global level, these levels being a context within which stakeholders exist.

Elaborating further on the structure of society,

Lépineux reflects on how stakeholders are

categorised: economic versus moral

stakeholders. Lépineux’s acknowledgement of

economic (blue) and moral (yellow) stakeholders

(Figure 18), that is business and societal

stakeholders both nationally and globally, allows

for a broadening of the scope for determining

stakeholders. This broadening of the stakeholder

view promotes an inclusionary view of

stakeholders. Whereas traditional stakeholder

models can be seen to provide a one dimensional

view of stakeholders (Section 5.1.), this one

dimensionality can and does affect how

stakeholders are viewed and classified. A further

point which Lépineux (2005:102) raises is the

Fig. 18. The Organisation and itsStakeholders (2005)

duality of stakeholders, adding further that it is an issue which has not been adequately addressed.

An important consideration therefore is the extent to which managers are aware of this duality and

the consequences of a lack of awareness of this duality. Due to the extent to which stakeholder

mapping is applied in organisations today, it can be argued that managers are aware of the

possible duality of stakeholders. A concern however is that an organisation may unintentionally

omit a stakeholder. As such, the duality of stakeholder roles is an important consideration, and one

that Lépineux (2005) appears to acknowledge and address. However, the extent to which

Lépineux’s acknowledgement of duality adequately addresses the needs of stakeholders who exist

in the shadows of society, or outside a manager’s immediate sphere of awareness, is a point of

debate and one that requires further examination.

5.3.3. Section SummaryLépineux makes a distinction between community and civil society stating that each is a

stakeholder per se. Broadening the understanding of society further, Lépineux identifies three

levels of social structure where individuals are united through an organic bond which is

characterised by unifying principles that go beyond the individual. As such, Lépineux recognises

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society as more than a mere collection of individuals where society exists as a distinct reality bound

together by social cohesion on a worldwide scale. Consequently, the implication of Lépineux’s

extended classification allows for an understanding that stakeholders exist at various levels of

society.

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5.4. The Potential for a Change in Mindset

Business today has resulted in social inequalities and structural irregularities which are not

restricted to areas traditionally associated with these phenomena (Section 4). According to

Lépineux (2005:103), the global nature of organisations today can therefore be seen to bear a

measure of responsibility for the deepening social divide in countries where they operate.

Furthermore, based on awareness that mechanisms can exist implicitly, and have an effect on a

stakeholder and an organisation, it is possible to encourage an inclusionary approach to the

mapping of stakeholders. In order to exemplify how the mapping of stakeholders can be further

developed, it is necessary to consider the rationale behind the development of a three part

contemporary stakeholder mapping process. As illustrated in Figure 13.d., Section 5.4. will address

the potential for a change in mindset through a further development of the points of consideration

raised in the earlier analysis.

Fig. 13.d. Analysis Progression

5.4.1. Conceptualising a Contemporary Stakeholder Mapping ProcessThere appears to be a consistent application of Freeman’s stakeholder map, placing focus on the

manager as the mediator between the organisation and its stakeholders (Section 4). Wolfe and

Putler (2002) expand further that much of stakeholder literature is susceptible to magnifying,

blurring and/or overlooking legitimate requirements (Fassin, 2009:115). An awareness of the role of

a manager and the potential implications of blurring or overlooking legitimate requirements can

have far reaching effects on a stakeholder and an organisation. For an NGO, this ability to

effectively map stakeholders in an environment which is dynamic due to increasing social inequality

and structural irregularities, the ability to effectively map stakeholders is of importance as resources

are allocated based on this knowledge. Engels (2005) claims that the focus of stakeholder theory is

more than the identification and possible integration of stakeholders (ibid.:120). This is a valid point

as it also has the potential for developing a change in mindset as it raises the possibility of a

potential shift in focus when addressing the mapping of stakeholders. This potential is made

possible through the reconsideration of the process by which an organisation chooses to express

or define its responsibility toward stakeholders. A Contemporary Stakeholder Mapping Process

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Sociological Foundation

Stakeholder Foundation

Ethical Development

Redefining Stakeholders

Potential for a Change in Mindset

Applying a Change in Mindset

5.1.

5.2. 5.3. 5.4. 5.5.

(CSMP) (Figure 19) can therefore be seen to potentially facilitate the stakeholder mapping process

in a third sector operating environment.

In the context of a shadow community (yellow),

a community which exists in the shadows of a

traditional society, it is necessary to consider to

which extent an NGO (red) tasked with

providing aid to a shadow community is aware

of this community’s needs. This level of

awareness by the NGO is an important one as

this stakeholder group can be perceived to be

without ‘voice’. The lack of a ‘voice’ can be a

result of the secrecy which surrounds a shadow

community, a factor which may lead to their

needs being overlooked. A further area of focus

are the political, environmental, and social

factors (green) which have an effect not only at

the community level of society but also on

Fig. 19. A Contemporary StakeholderMapping Process (CSMP)

national and global level. A further consideration given the layered nature of society is: community

(green), national society (purple), and the global society (blue). Consequently, based on the

emergent nature of an NGO’s environment, and an acknowledgement of social inequality and

structural irregularities, an interactive and iterative dimension to the stakeholder mapping

process is required.

5.4.2. Guiding Principles of a Contemporary Stakeholder Mapping ProcessIn order to address the potential for a change in mindset through a modification of the existing

stakeholder mapping process, it is necessary to acknowledge and consider potential gaps in

theory. These gaps include the fact that existing stakeholder theory does not appear to have a

clear definition of a ‘stakeholder’ and ‘stake’, the absence

of a clear distinction between business and societal

stakeholders, a lack of acknowledgement of economic

and moral considerations (Section 4). Applying Figure 20,

the initial part of establishing an inclusionary approach to

the mapping of stakeholders in a business-society

relationship in the third sector is the determination of the

societal structure. Thus, progressing outward from the

centre, the NGO (red) is centrally placed within the

community in which it operates (green). The central

placement of the NGO visually signifies the central role of Fig. 20 Society and StructuralAspects

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NGO

the NGO and the context which characterises its operating environment. The national society, or

civil society as per Lépineux (Section 5.3.), is representative of the nation state (purple) in which

the NGO is based. Lastly, through the inclusion of global society (blue), allowance is made for

stakeholders that are not immediately linked to the NGO but can potentially affect or be affected by

the NGO. A consideration of the three tiered structure of society makes allowance for recognition of

a broader view of stakeholders. Accordingly, through consideration of the layered structure of

society, the potential exists for an inclusionary approach to the identification of societal

stakeholders who need to be considered even though they are not immediately visible to the

organisation.

The second part of the visual development process recognises the current theoretical gap in ethical

business considerations and practices: the lack of a clear definition for CSR and CC (Section 4),

the difficulty associated with operationalising this, and the lack of a holistic approach to its

operationalisation. Moreover, social demands vary in time and space and even within the same

group of stakeholders (Valour, 2005:194). This variance across time and space can make it difficult

to determine a single event or cause. An

acknowledgement of the time and space continuum

and a recognition of the dynamic nature of global

business can therefore facilitate the development of

a visual representation of an organisation’s spheres

of influence. The potential therefore exists for the

development of a process which acknowledges the

emergent nature of an organisation’s environment.

Progressing outward from the centre of Figure 21,

the NGO (red) is once again centrally placed within

the three spheres of societal impact (green). This

central placement of the NGO visually depicts its role

Fig. 21. Spheres of Societal Impact

within the context of its operating environment and the spheres which can potentially have an

influence on individuals and the organisation. The three spheres therefore represent factors which

can have an effect on the NGO and also the organisation’s areas of influence.

Developing further on the first two mapping processes a

consideration of the organisation’s sphere of responsibility

is necessary. Acknowledging the fact that an organisation

(red) is context specific, and in line with the context of the

thesis, the shadow community (yellow) has been

centrally placed within the organisation. The central

placement of the shadow community visually reinforcesFig. 22. Core Focus

the organisational focus and the cause to which the organisation is committed. The final stage, but

no less important, is therefore the interplay between the NGO and a shadow community.

Expanding further on the context specific nature of an organisation, an NGO’s context can be

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Shadow Community

categorised by its area of responsibility, for example UN.GIFT (Section 4) which focuses on

combating human trafficking. As a consequence of this context specific nature, the NGO will have

the knowledge and skill set necessary to effectively address stakeholders who are affected by and

can affect victims of trafficking. Furthermore, the skill set developed through this context specific

operating environment will also allow the NGO to develop management and communication

strategies specific to the organisation’s context. The justification for positioning the shadow

community within the NGO sphere of influence is therefore that as a shadow community is not in a

position to adequately address their own needs, it is necessary for the NGO to take on the

responsibility of managing this. As Waddell (2000:111) explains, poverty is not just caused by a

lack of money but can be due to the fact that individuals do not have connections and a role in the

systems that produce wealth. This dependence on an NGO by a shadow community can be seen

to support this claim by Waddell.

5.4.3. Section SummaryFor an organisation to effectively address stakeholder mapping in the 21st century, it is necessary

that the mapping process acknowledges the dynamic nature of the environment in which

organisations operate and individuals exist. An acknowledgement of this dynamic nature requires

an acceptance of the potential for a change in the practice of stakeholder mapping. This has led to

the development of the Contemporary Stakeholder Mapping Process which proposes a three

part visual process which guides management through the stakeholder mapping process. The first

step of the guide is the identification of organisation’s ‘core focus’ (a marginalised community).

Secondly, the development of an overview of environmental aspects that can affect the

organisation’s core focus is established through the inclusion of the ‘spheres of societal impact’. Lastly, the mapping process includes ’society and structural aspects’ which establishes an

overview of society and societal structures within which an organisation operates.

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5.5. The Applicability of a Change in Mindset

Section 5.4. has established a potential for a change in mindset, this potential being possible

through the consideration of a CSMP. However, for a change in mindset to be possible, it is

necessary that the mechanism proposed can be applied. In order to examine the applicability of a

contemporary approach to stakeholder mapping, Section 5.5. (Figure 13.e.) will examine and apply

the process developed in the preceding section.

Fig. 13.e. Analysis Progression

5.5.1.Acknowledgement of Dynamic Environmental Factors and Societal Structures Lépineux (2005:103) recognises that a global society is emerging that does not express itself

through institutional devices such as governments. In an attempt to address this phenomenon,

global initiatives such as the United Nations Global Compact (UN Global Compact), launched by

Kofi Annan (Lépineux, 2005:103), have been implemented. Such initiatives according to Lépineux

(2005:102) exemplify a changing mindset where stakeholder groups and civil society are

increasingly exerting pressure on organisations for greater integration of social dimensions.

Society is constituted by the dynamic adjustment between the organisation and society at large,

this adjustment being reflected in social expectations which evolve from these relationships

(Buchholz, 1996:450). As a result, an organisation can be seen to bear a measure of responsibility

for the emerging dynamism which exists in societal structures today. To address this dynamic

nature, an acknowledgment of the extent to which individuals are included is an important design

consideration for theorists attempting to address an inclusionary approach to stakeholder mapping.

Through the incorporation of the ‘society and structural consideration’ (Figure 20) of societal

structure, the structural layering of an organisation’s operating environment is visible. It is however

strategically inappropriate to assume that a single generic visual representation can represent all

organisations as, for example Lépineux, Fassin, and Freeman. In the case of a CSMP, allowance

is made for differences in organisational and sector specific dynamics through the redefinition of

the focal point. In the case of private sector organisations, the role of management as the mediator

between the organisation and its stakeholders is still recognised. However, in a third sector context,

management’s role can be viewed as that of a gatekeeper. This position of gatekeeper entails the

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Sociological Foundation

Stakeholder Foundation

Ethical Development

Redefining Stakeholders

Po

te

nt

ia

l f

or

a C

ha

ng

e i

n M

in

ds

etAp

pl

yi

ng

a C

ha

ng

e

in

Mi

nd

se

t

5.5. 5.4. 5.1.

facilitation of strategies and communication associated with its ‘core focus’, the shadow community.

Due to the central placement of the shadow community, decisions made and resources committed

are therefore based on the requirements of this community.

Additionally, environmental considerations such as politics, society, and economics can be

understood as dynamic environmental factors, factors which not only affect an organisation but

also its stakeholders. An acknowledgement of this dynamism is visually illustrated in the ‘spheres

of societal impact’ (Figure 21) where the three propellers interconnected and overlap with societal

structures. Through an iterative process, the overlap between environmental and societal

structures to varying degrees affects the structural layers of society and an organisation’s operating

environment. While a traditional stakeholder map, in a private sector context, may present a

plausible overview of an organisation’s environment, third sector operational goals are however not

based on financial gain but rather one of welfare improvement. Consequently, a CSMP makes

allowance for the dynamic nature of an operating environment while also acknowledging the role of

management through its inclusion in the CSMP. Hence, management has the role of a gatekeeper

between these environmental factors and the shadow community which is/or can be affected by

these factors.

The application of the ‘spheres of societal impact’ (Figure 21) when determining stakeholders and

their stake allows for visual progression through the environment and a cognitive acknowledgement

of the dualism of stakeholders: stakeholders as employee-consumer, supplier-customer, etc.

Stakeholder dualism however is not the only form of dualism which the ‘spheres of societal impact’

recognise, it also makes allowance for the interconnectedness of environmental factors, for

example socio-political, socio-economic, etc. Through recognition of the different degrees of effect

and societal structures, a third sector organisation is better prepared to deal with the dynamic

nature of a shadow community, and as such better positioned to meet the strategic and

communication processes necessary to address the requirements of its ‘core focus’. The

application of the ‘spheres of societal impact’ can facilitate the development of an overview of

stakeholders who have a stake in the ability of the organisation to meet its goals. These

stakeholders and stakes can exist on three levels, firstly, locally, where the local communities meet

the direct costs related to helping a shadow community through, for example hospitals and social

workers who provide daily aid and services to the shadow community. Duality is a characteristic of

this environment as spheres of social impact can overlap, for example socio-political and socio-

economic factors can be evident in an environment. This means that socio-political factors such as

the community’s desire to alleviate the suffering of trafficking victims within a shadow community as

well as the policies in place to facilitate this desire. Additionally, the shadow community itself can

be seen to be grounded on socio-economic factors both within the victim’s country of origin but also

grounded on local socio-economic factors within the country where victims now live. As a

consequence, due to the dynamic nature of a shadow community as well as the dynamic

environment in which it exists, the NGO as a gatekeeper can facilitate the flow of aid and

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communication of the requirements of this community thereby providing the community with a

‘voice’.

Secondly, nationally, the power of governments is increasingly diminishing, and legislative

structures are regularly being challenged due to globalisation. In light of this, pressure is

increasingly being placed on organisations and global institutions to fulfil the role of ‘government’

through, for example, CC. Meeting the expectations of society and fulfilling the role of CC requires,

by both local and national organisations, that there is an awareness of how environmental factors

can facilitate or hinder an organisation’s ability to meet societal expectations. The CSMP makes it

possible for an organisation to identify national stakeholders who hold a stake in the ability of the

organisation to meet the shadow community needs. This ability to meet the needs of a shadow

community can be achieved by applying the dualism of socio-political factors, with attention

directed toward the fact that governments are responsible for executing laws and policies. These

policies and laws are not only industry but also country specific and can affect and/or be affected

by not only the national society but also local and global societies. Furthermore, as a shadow

community, is structurally constituted by victims from a number of countries, this fact presents

logistical problems for the NGO both locally and globally as cross border legislative considerations

need to be taken into account. These legislative considerations can be further impacted by the host

country’s law and policies, especially as there is much debate on how best to protect victims of

trafficking. Consequently, by being in a position to visualise societal structures and the dynamic

nature of environmental factors, as well as the interconnectedness of these, one is better

positioned to gain an overview of interconnected factors which can affect an organisation and

stakeholders.

Lastly, globally, taking into account organisations such as the United Nations and initiatives like the

UN Global Compact, the development of a broader overview of the societal factors is possible. The

development of this overview by an NGO will allow the organisation to identify stakeholders on a

global scale. The benefit associated with this is that not only do these global organisations like the

UN have a more comprehensive overview of societal factors, but they also have connections to

similar NGOs in other countries. While organisations involved with similar initiative may not be

immediately linked to a specific organisation, they may however have knowledge of stakeholders in

their local or national societies that can be beneficial to another organisation and in turn a shadow

community. While the immediate focus here is not on the shadow community as the focal group,

the organisation as the gatekeeper possesses the structural ability to gain access to this

information. This again highlights the structural layering and dynamism which characterises a

shadow community. Consequently, an awareness of this structural layering and dynamism is an

important consideration for strategy and communication processes. Furthermore, the

interconnected and dynamic nature of environmental factors and societal structures supports the

need for a mechanism which allows management in the role of gatekeeper to identify a

stakeholder’s stake and through this facilitate strategy development and communication.

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5.5.2. Collaboration and Gatekeeping As a society is constituted by the dynamic adjustment between the organisation and society

(Buchholz, 1996:450), it is necessary that an organisation takes the perspective of society as a

whole and incorporates the standards and authority of society. A negotiation between business and

society results in a decision concerning which social issues require attention, and how many

resources should be allocated for the resolution of these (ibid.:446). Furthermore, as the social

behaviour of a population is dependent on relations between individuals, and as the probability of

contact is not the same for every point of connection (Rapoport & Horvath, 1961:280), it is

therefore not feasible to assume that each business-society relationship will be the same. The fact

that business-society relationships vary, and that a shadow community in itself is dynamic, requires

that an organisation is able to act as mediator or gatekeeper (Figure 23). The role of gatekeeper

implies an ability to navigate the structural layering and dynamism which characterises a

stakeholder’s environment today. Fassin (2009:113) sees stakeholder management as becoming

an important tool for transferring ethics to management practice and strategy, which supports the

organisations role as gatekeeper. The combing of stakeholder management with management’s

role as gatekeeper can facilitate strategy and communication processes. Furthermore, as ethical

business practices are increasingly being placed under the spotlight, the increases in business-

stakeholder relationships are a key component of the emerging CC framework (Waddell,

2000:108). According to Carroll & Buchholz (2006) and Crane & Matten (2004), stakeholder

management has therefore gradually been adopted as the leading red thread for merging business

and society requirements (Fassin, 2009:113). This increase in attention given to ethical business

practices and stakeholder management therefore also supports the need for a mechanism which

can address social issues through business-society relationships.

Phillips et al. (2003) see stakeholder theory as a theory of organisational strategy and ethics

(ibid.:119). As such, strategy development and communication processes can be seen as ‘carriers’

of ethical practices, these strategies and processes being developed by managers. Additionally,

third sector organisations are not motivated by the same strategic goals and objectives as a public

or private sector organisation. Furthermore, the manager in his role as gatekeeper has access to

both explicit and tacit knowledge which is specific to his organisation and the shadow community

they are working with, knowledge which can benefit the shadow community. The role of a

gatekeeper can therefore be exemplified as follows: when a new law is passed on trafficking, the

principles of this law filter through the structural layers of society to the NGO that acts as the

gatekeeper to the shadow community. The application of, or enactment of, the principles of the law

are therefore specific to that particular context as explicit and implicit occurrences merge to create

a context which is specific to that organisation and the dynamism surrounding the shadow

community.

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The organisation can be seen to act as co-ordinator

between its CC efforts and the needs of the focal group

and its stakeholders. The role of the gatekeeper

therefore develops a clear visual representation

between traditional stakeholder reasoning which sees

the organisation as the nexus, with management as the

responsible agent, and managerial capitalism which

finds its roots in financial gain. This central placement of

the organisation, as a consequence, creates a cognitive

link between stakeholders and the organisation.

However, as a third sector organisation is not motivated

Fig. 23. An NGO as aGatekeeper

by financial gain, it is necessary to challenge the existing cognitive association in an attempt

to ‘re-route’ the focus to the organisation’s real reason for being: the shadow community. As is the

case in many third sector initiatives, the stakeholder in whose interest activities are initiated is

unable to manage these initiatives, and this is therefore the primary role of the gatekeeper:

management of initiative.

5.5.3. Section SummaryThe application of the CSMP allows for a process whereby societal structures and dynamic

environmental factors can be identified. This identification is essential in a sector which exists to

address societal inequality and structural irregularities which are the result of a dynamic business

environment. Through a visualisation that acknowledges the structural layering which is evident in

society today and dynamic environmental factors, it is possible to identify specific needs of a

marginalised community. This process of identification is facilitated by a gatekeeper, which is an

NGO that is strategically positioned to act as coordinator between the marginalised community and

its stakeholders. The NGO’s primary focus is therefore the marginalised community, for example a

shadow community, which does not possess the network through which to gain access to the

necessary resources.

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Gatekeeper / NGO

Shadow Community

5.6. Sub-conclusion

Through a closer examination of the strengths and weaknesses of existing theory, potential gaps

can and will become visible. The extent to which these strengths and/or weaknesses can present a

possible theoretical gap can only be ascertained by placing theories within the context in which

they will be applied. As such, through a consideration of the role of business and society

relationships in the 21st century, specifically in relation to the role of CC and stakeholder

management, the analysis has revealed that there is an apparent theoretical gap in terms of how

stakeholders and their stake are addressed. This gap can be seen as a result of management’s

placement as the nexus from which all other stakeholders are represented. This gap is further

established by the cognitive strength of Freeman’s traditional stakeholder model which provides the

framework for visually illustrating stakeholders.

In accordance with an increase in awareness of ethical business practices and business

commitment to meeting regulatory and legal mandates, an understanding of the processes

affecting third sector activities is necessary. NPOs and NGOs, which through collective agency

have become interwoven in the fabric of society in the 21st century, are therefore increasingly

entering into partnerships with public sector organisations and society. There is however, during

strategy and communication planning, an apparent dependence on Freeman’s traditional

stakeholder mapping process, a process which has resulted in the generalised application of this

mapping process across all industry sectors: public, private, and third sectors. Furthermore,

corporate citizenship’s apparent lack of clarity surrounding the definition of ‘responsibility’

necessitates the need for iterative processes which can facilitate the development of an overview

of environmental aspects, that is social, economic, and political aspects. As a result, the

Organisational Sphere of Activity can be seen to provide a visual tool with which an organisation

can gain an overview of the interconnection of societal aspects with environmental aspects.

In order to address the theoretical gap in CC and stakeholder management within the context of

the third sector, the analysis has proposed the application of the CSMP. The application of the

CSMP allows for the identification of societal structures and dynamic environmental factors, factors

which can influence how stakeholders can affect or be affected by an organisation’s ‘core focus’

(the shadow community). Consequently, through a gatekeeper facilitated identification process, it is

possible to identify specific stakeholder needs through a visualisation that acknowledges the

structural layering of society and dynamic environmental factors.

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6. Discussion “A fundamental concern for others in our individual and community lives

would go a long way in making the world the better place we so passionately dreamed of.”8

Partnerships, according to Lunnan and Haugland (2008:545) have a reported failure rate which

ranges between 30 – 70 percent. This failure rate is an important consideration as third sector

initiatives are dependent on partnerships and the extent to which stakeholders intersect to create

third sector initiatives. Gulati (1998) expands further that these partnerships involve exchange and

sharing or co-development of, for example, services and resources (Lunnan & Haugland,

2008:545). These factors, Lunnan and Haugland (2008:545) explain, require the structuring of a

partnership based on partner contributions, with consideration given to how contributions are linked

to the strategies of partners and value creation. Value creation for the partners can benefit the third

sector organisations that in turn pass this on to their initiatives. Understanding value creation in the

third sector therefore requires an acknowledgement of the fact that numerous partners come

together to present a unified front on a particular initiative. This unified front requires that an

organisation is aware of complex communication processes which characterise communication and

facilitate strategic planning by an organisation. Consequently, due to the nature of alliances and the

importance placed on value creation for the partners, it is necessary to discuss what constitutes

value and how this can be realised as well as its effect on the communication processes.

6.1. Structural Synthesis vs a Change in Mindset

In order for a third sector organisation to benefit from a CSMP, a clear understanding of how

individuals and society are intricately interwoven and the relevance of their role in the development

of a change in mindset and the communication of this is necessary. The promotion of a change in

mindset requires involvement by individuals and partners, involvement which can be promoted

through ‘collective agency’. ‘Collective agency’, Koschmann et al. (2012:333) explain, is the ability

to act and influence a number of relevant outcomes beyond what an organisation could achieve on

its own. The ability to influence numerous outcomes, Lawrence et al. (2002) argue, is not merely an

issue of structural arrangements but an emergent process which results from communication

processes that are distinct from market or hierarchical mechanisms of control (Koschmann et al.,

2012:333). When considering the potential of effective stakeholder mapping, it is interesting to

consider how a change in mindset can create a foundation from which strategy development and

communication processes can occur. In order to create such a foundation, an awareness of the

interconnected nature of individuals is necessary as a third sector organisation’s ability to

effectively address the needs of stakeholders is dependent on the organisation’s strategy

8 Nelson Mandela

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development and communication processes. Weick views organisations as synchronised

behaviours in which bi-directional sequences of interaction form the basic building blocks, which

through their continuing interaction have the capacity to create, maintain, and dissolve

organisations (Putnam et al, 2009:6). This approach views organisations as systems of social

practices, texts, or memories derived from language and action (ibid.:9). Accordingly, the

Communicative Constitution of Organisation (CCO) approach moves beyond local construction of

communication to illustrate how dislocal practices and resources are an important consideration

(Putnam & Nicotera, 2010:162). As a result, an organisation and its communication is no longer

distinguishable one from the other and as such are mutually constitutive (Putnam et al, 2009:9).

Consequently, it can be argued that the importance of individuals and their relevance in the

development of a change in mindset and the communication of this is an important aspect as they

possess the ability to influence numerous outcomes.

The ability to influence numerous outcomes requires an organisation’s openness to a change in

mindset as business and society are in a constant state of negotiation over social issues and

resources. Buchholz (1996:446) expands further that stakeholder theory and social contract theory

are both based on the assumption that the individual is the basic building block of society. This

recognition provides the framework for aiding the negotiation and decision making process as it

recognises both business and society’s role in meeting not only societal expectations but also an

organisation’s accountability to society. This recognition further reinforces the duality of roles of

individuals, this duality of roles however requires awareness during meaning negotiation. Meaning

negotiation is an important aspect as communication is characterised by both implicit and explicit

elements, where implicit elements hold deeper meaning and affect interactions between

individuals. Communication is thus understood as a complex process of meaning negotiation and

construction where meaning is more than what exists within an individual’s mind but rather the

intersubjective product of coordinate interaction (Koschmann et al., 2012:335). This intersubjective

product of meaning negotiation and construction, it can be argued, necessitates the recognition of

the interconnected nature of individuals who have the ability to influence a change in mindset

through a text which is representative of the actors’ objective and/or commitment to the third sector

initiative.

For meaning negotiation and construction to occur, an organisation requires awareness of its

stakeholders and their stake. In order to determine this, management turns to the stakeholder

model, a visual illustration of the bi-directional nature of the relationships between the organisation

and different groups. The mapping of these bi-directional relationships, it can be argued, is

subjective and according to Fassin (2008:880) can be seen as a synthesised representation of

social constructs that simplify and reduce reality. It can therefore be argued that such simplification

of social constructs, as a consequence, can both positively and negatively affect the academic

value of a stakeholder map. An example of such a negative effect is the equal representation of all

stakeholders. This equal representation may be due to a lack of awareness of the mechanisms

which can affect a stakeholder and consequently result in a specific stakeholder requirement. An

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important factor related to this misrepresentation is that it can result in a lack of sensitivity to the

needs of a specific stakeholder group. This misrepresentation not only affects stakeholders

negatively but is also a factor which can affect an organisation’s strategy development and

communication processes. As such, the equal representation of all stakeholders does not

cognitively acknowledge that certain stakeholder needs may be greater than others, thereby

resulting in strategy development and communication processes which are more general rather

than targeted at specific stakeholder requirements. The application of the CSMP, which it is

acknowledged is also a cognitive assumption of possible mechanisms that can affect an

organisation and individuals, however challenges the simplistic representation and possible

uncritical application of the traditional stakeholder model across all industry sectors. The CSMP,

attempts to encourage a closer examination of the context within which an organisation operates

and how stakeholder models are applied. Through this examination and the proposal of possible

contextual considerations, the prescriptive nature of current mapping processes is challenged in

favour of a more emergent approach which acknowledges a dynamic understanding and

representation of factors or mechanisms which characterise business and society today. This

acknowledgment, it can be argued, encourages openness toward the possibility that unobservable

and deeper lying factors can potentially hinder or facilitate a change in mindset.

The development of a foundation for a change in mindset requires involvement by individuals as

social behaviour is strongly dependent on others, with certain individuals having a greater influence

than others (Rapoport & Horvath, 1961:280). It can therefore be discussed that as individuals make

up both business and society, and due to the fact that certain individuals have a greater influence

than others, the interplay which occurs between individuals can determine the extent to which

individuals are interconnected. A possible implication of this interplay between individuals is self-

interest. Self-interest, as Buchholz (1996:449-450) explains, may bring individuals together yet may

result in separate motivations and desires which continually collide and make it difficult to arrive at

mutually satisfactory outcomes. This inability to reach agreement may be due to differences in how

communication occurs between the organisation and its stakeholders, or among the individuals

themselves. Misunderstanding may stem from the differences in how individuals interpret

communication across national borders or within the organisation and how this is reflected in their

interaction. For an NGO directly involved with a shadow community, awareness of the dynamism

which exists within this community and amongst the individuals can facilitate strategy development

and effective communication processes. Consequently, it is important that the mapping process,

and the role it plays based on the assumption that individuals explicitly and implicitly can influence

business-society relationships, acknowledges that individuals are an important consideration in the

strategizing of a change in mindset through the communication of an inclusionary approach to the

stakeholder mapping process.

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6.1.1. Section SummaryManagement and their role in the promotion of an organisation’s change in mindset is an important

consideration as the communication which is produced as a result of this change in mindset is

representative of the organisation and has the potential to influence numerous outcomes. As such,

a change in mindset requires an acknowledgement of the interconnectedness of individuals, this

interconnectedness establishing the infrastructure through which a change in mindset occurs. It

can therefore be argued that the CSMP facilitates the framework necessary for an emergent

approach to the identification of mechanisms which can potentially influence how a stake is

identified and characterised based on how a stakeholder can affect or is affected by the

organisation’s core consideration.

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6.2. The Significance of a Change in Mindset

Organisations today are the main economic and social actors and are increasingly faced with

issues which find their roots in civil society (Lépineux, 2005:102). As organisations possess a great

deal of social power, which brings with it an expectation that the organisation will act responsibly, it

can be argued that organisational strategy in the 21st century requires re-evaluation. This re-

evaluation is necessary as not all industry sectors are the same. An example of this is the private

sector which is managed for financial and the third sector where the focus is on society and the

quality of life for a marginalised. As such, in order to address the difference in business practices

between sectors, it can be argued, that a change in mindset is required where the stakeholder

mapping process refocuses attention away from the organisation in a third sector context and

redirect it to the organisation’s reason for being: the marginalised community or ‘core focus’.

As a marginalised community is not a recognised entity with recognised laws and regulations, but

is none the less the focal point, NGOs become the intermediary between the stakeholders and the

marginalised community. The NGO or NPO as the gatekeeper is therefore a necessity as the

organisation exists according to recognised laws and regulations and thereby have the authority to

lend a voice to the marginalised community. As such, the NGO, it can be argued, is adequately

equipped to act as facilitator or gatekeeper. Furthermore, as the government’s focus is primarily

directed at society at large, this focus creates a potential weakness in the government’s ability

meet the needs of all its citizens which leaves a void to be filled by organisations. Due to this void

partnership between and across industry sectors bring together organisations with different abilities

in an attempt to address this void. The significance of a change in mindset is evident in the ability

of partnerships to meet the needs of marginalised communities through the development of

strategies and communication processes which address the morality and technicality of social

involvement today. Valour (2005:194) claims that while organisations may be accountable to

multiple constituents, due to their licence to operate. A concern however are the risks associated

with an organisation’s inability to adequately meet the requirements of all its constituents. A further

point of consideration is as Waddell (2000:118) claims, the possible tendency of non-profit

organisations to become more like business. While this can be understood to be a valid concern,

as both private and third sector organisations depend on economic mechanisms, it can be debated

to which extent it is possible to assign financial value to a third sector ‘product’ which is the

generation of humanitarian value. On the other hand, the private sector organisation has a product

which has a market value for which it is possible to determine a value through a cost analysis.

As suggested earlier, commitment to a specific industry sector requires sector specific

communication and strategy development. While it can be debated the degree to which an

organisation should approach strategy development and implementation from either an emergent

or prescriptive approach, it is agreed that the outcome of either one of these strategies does and

will have an effect on the organisation, its stakeholders, and the partnerships. A point of discussion

however is the diversity which exists in the multi-layered meaning creation process the

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communication and strategy development process. This iterative process develops multiple levels

of meaning negotiation among individuals, which according to Koschmann et al. (2012:335)

supports an interactive and dynamic negotiation of meaning. Meaning creation is an essential

element of communication as, according to Ashcraft et al. (2009), communication is more than the

mere transmission of information but rather a complex process of meaning construction and

negotiation during which actors make use of interpretations and symbols to create meanings that

organise and control activity and knowledge. It can therefore be argued that the traditional

prescriptive approach will address the strategy process in a linear fashion which can negatively

influence meaning and meaning negotiation as meaning is not allowed to develop as it would in a

more social context. An emergent approach would however increases focus on contextual aspects

of strategy development as dynamic and environmental complexity is acknowledged and seen as

part of the development process. The outcome of the dynamic and complex strategy development

is the carried through in the communication process by individuals who align actions with a

common objective. Taylor and van Every (2000) see this alignment of actions in relation to a

common objective occurring through an ongoing dialectic of conversations and texts (Koschmann

et al., 2012:335). The significance of a change in mindset is therefore the ability to develop

mutually beneficial partnerships which acknowledge an emergent process which facilitates multi-

layered meaning construction processes that are carried through into the communication

processes of individuals. These processes will consequently, strengthen strategy development and

communication processes which convey an organisation’s commitment to establishing a

contemporary stakeholder mapping process which allows for an inclusionary approach to the

recognition of the requirements of a marginalised community.

6.2.1. Section SummaryOrganisations today possess great social power and through this bear moral and ethical

responsibility for ensuring that society does not carry the cost of business activities. The implication

of this responsibility is that for a third sector organisation to effectively address its strategy

development and the communication of this, it is necessary that mutually beneficial partnerships

are established that acknowledge an emergent process which facilitates multi-layered meaning

construction. Consequently, it is argued that this meaning construction is particularly significant

when societal and environmental dynamics can affect an organisation’s ability to establish an

inclusionary stakeholder mapping process.

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6.3. Benefits of a Contemporary Stakeholder Mapping Process

6.3.1. The Role of Trust An interesting point of departure in the discussion of the CSMP is the benefits to be gained and the

role of trust. As the analysis highlighted, the role of responsibility and how this is assigned is an

important aspect within stakeholder theory and CC. While responsibility is also a necessity, trust is

an essential aspect in the third sector. Trust is not only an element of human interaction but also

has an effect on an organisation’s strategy. CC, as Andriof & McIntosh (2001:14) explain, is the

understanding and management of an organisation’s wider influences on society for the benefit of

the organisation and society as a whole. Consequently, if an organisation is able to combine a

CSMP with strategy development, this combination can be beneficial to an organisation. As

organisations increasingly possess great social power, society has an expectation that business

will be conducted ethically and for the benefit of society. While an organisation may view this

requirement by society from the perspective of its responsibility to society, society trusts that an

organisation will honour its responsibility. Trust can be seen to be an essential aspect for an

organisation as without trust, individuals are less likely to participate in the communication process.

It is therefore necessary that an organisation builds trust and credibility with its stakeholders by

recognising their role in the communication process.

Understanding how communication occurs is necessary as an organisation is crafted through its

communication. According to Koschmann et al. (2012:350), communication has the capacity to

constitute and sustain complex organisational forms. This ability is made possible by collective

agency where individuals and organisations are active in the communication process. A

consequence of this collective agency is the ability of individuals to influence the communication

process which is emergent and reflects the context within which it is produced. This collective

agency of individuals is an important consideration as, as Waddell (2000:118) notes, it is not

unusual for the business sector to question what third sector organisations can offer them, and this

may result in hostility between the sectors. In the event of hostility, it can be discussed to which

extent a lack of trust between the partners has resulted in a lack of clarity in an organisation’s

communication of the value to be gained from its activities. A third sector perspective, an

organisation could therefore benefit from the application of the CSMP as part of its strategy

development process, where focus is placed on how a marginalised community’s needs can be

met and aid delivery enhanced. Consequently, through the application of the CSMP, strategy

development can be improved and aid delivery enhanced, thereby allowing the organisation to

communicate consistent and credible information which provided stakeholders with measurable

data.

6.3.2. Trust and MeasurabilityIn a sector where value is not measured in ‘Dollars and Cents’, but rather in the value it provides to

society, this value is therefore not measured on an organisation’s balance sheet. Furthermore, in a

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sector where partnerships are an essential part of third sector initiatives, measurability is a

necessity. In an attempt to address this measurability, Koschmann et al. (2012:350) suggest that

theory on communication as constitutive of an organisation offers a possible means of measuring

the success of partnerships as it grounds the constitution of these partnerships within

communicative processes. As such, this communicative process allows for an explanation of how

to increase the value of partnerships. Value creation is therefore an important aspect in

partnerships, and it can be argued that it is an aspect which can be facilitated through trust.

Partnerships, within or across sectors, are entered into on behalf of marginalised individuals and

are the result of government’s inability to meet the expectations of society. As such, organisations

are increasingly assuming the role of government (Section 4), this role placing great social power in

their hands. This social responsibility requires that trust is developed not only between the

organisation and society but also between the organisation and its partners. This relationship is an

important aspect for measuring the effectiveness of the partnerships and the benefits that

have/have not been achieved through the partnership. Furthermore, the relationships which are

built up around these partnerships play a deciding role in the unifying of individuals to the strategy

of the organisation. This unification can be facilitated by a communication framework which

addresses the intricacies of partnerships. As Koschmann et al. (2010:338) state, the

communicative constitution of an organisation offers a descriptive framework which explains

partnerships as textual coorientation systems. This framework, Koschmann et al. (2010:338)

elaborates, also locates the capacity for collective agency and its role in an authoritative text. This

authoritative text can benefit an organisation and its communication.

The unification of partners can be facilitated through trust, and this trust is also an important

element of the CSMP as this same reliance on trust is a necessity not only for the marginalised

community but also as a result of the role of a third sector organisation. Without this trust, strategy

cannot be developed and put into practice as it is necessary to create a context where individuals

feel comfortable with the ability and commitment of the NGO. An important consideration during the

communication of a strategy is the extent to which cultural backgrounds and organisational culture

can influence the ability of the NGO to effectively address and communicate the needs of a

marginalised community. A point to note is therefore that the establishment of trust does not occur

overnight, but rather is a long term process and is specific to individuals. As such, a concern for an

NGO is that if the gatekeeper leaves the organisation, the trust that has been built up with an

individual or community marginalised is at risk of being lost. Awareness of cross boundary

communication and the role of trust, it can be argued, is therefore a necessity when the individual

acts as gatekeeper. Consequently, through a change in mindset from within the NGO, it is possible

to maintain a constant level of service to the marginalised community as all individual can be seen

to hold the same mindset, and this mindset is communicated to partners and society through

individuals and the strategy development and communication process of the NGO.

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6.3.3. CSMP’s Convergence with a Business-Society Relationship While the role of trust and measurability are important contemplations for a model that requires

collaborative participation, it is however also necessary to consider how the benefits attainable

from collaborative partnerships can be facilitated as well as the benefits achievable from this. The

global nature of business today can be seen to support the development of a global mindset by

individuals and organisations. A global mindset represents knowledge structures (Gupta et al,

2008:138) and can be seen as a way of being rather than a set of skills (Lovvorn and Chen,

2011:276). While this development of a global mindset can benefit an organisation, it can also be

argued that it encourages private sector involvement in global issues through global CC initiatives

which involve third sector initiatives. Communication, as the process by which an organisation’s

mindset is communicated, is therefore a necessary consideration in the point of convergence

between a business and society relationship.

An organisation’s mindset, Gupta (2008:120) expands, is the combined mindset of individuals

adjusted for the distribution of power and mutual influence among individuals. The communication

of this mindset, it can be argued, is the result of micro and macro level communicative

considerations. Communication, Kuhn (2012:548) explains, is producer and carrier of

organisational reality, and he therefore warns against a division between macro and micro level

communication deliberations. Kuhn (2012: 44) elaborates further that entities such as organisations

and institutional fields are favoured on a macro level, with individuals, groups, and routines

considered on a micro level. In terms of this differentiation between micro and macro level

communication, while it may be perceived as logical from a theoretical standpoint, it can be argued

that communication occurs across organisational boundaries and is the product of social activity.

As such, awareness of the fact that communication is the product of social activity is a necessity for

the promotion of a change in mindset, as it is through social activity that a change in mindset is

made possible.

Due to the dynamic nature of business and society relationships, a point for discussion is the point

of convergence where business and society meet on third sector initiatives. The initial point of

contact is established through an identification of the needs of the marginalised community. The

identification of these needs is performed from the perspective of the community, this perspective

is made possible by the ‘core focus’ design of the CSMP. While the identification of needs is an

essential part of an NGO’s initiative, it is also important that an organisation is able to meet the

requirements which are identified. Especially where these requirements are the result of

government’s inability to provide, for example services and infrastructure which traditionally has

been government’s responsibility. Clark (1995:593) elaborates further that the provision of services

and infrastructure, regulations and market mechanisms, and economic policy are seldom targeted

toward vulnerable groups. As such, a need exists for greater involvement by society and business

in developing participatory development approaches which can help to prevent social irregularities

and structural irregularities. The convergence of business with the third sector in collaborative

activities result in new organisational structures which Waddell (2000:119) claims should be

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thought of as new forums for negotiating solutions to social issues. It can therefore be argued that,

through a process where more context specific data is collected, through use of the CSMP, it is

possible for the NGO to effectively address resource requirements and the communication of these

requirements. The dynamic approach of the CSMP, through a visualisation of the overlap between

societal and environmental aspects, facilitates the development of an overview of mechanisms

which can affect the community, as well as cross sector or partnership strengths that can

potentially be used to the NGO’s advantage. Furthermore, the CSMP can allow for the identification

of cross sector opportunities or threats and overlaps in areas of focus or resource availability. The

identification of these overlaps can benefit an NGO with multiple partners and initiatives as the

areas of overlap that emerge provide an overview of where resources can be pooled thereby

reducing costs. This ability to pool resources can financially benefit an NGO, which depends on

financial aid from the public and private sector. Consequently, it can be argued that the CSMP

prevents the duplication of costs through the pooling of aid delivery and aid services where

possible, thereby reducing wastage and redundancy.

As Kuhn (2012:568) notes, communication is understood as a process of negotiation where the

negotiation process is understood as a guiding movement through conceptual or physical space.

However, not only is the negotiation process guiding movement, it also conjures up the notion of

interaction aimed at generating or solidifying a relationship (often rendered in terms of negotiating a

contract) (Kuhn, 2012:568). This negotiation process between the NGO and partners therefore

requires meaning negotiation and construction which can solidify the relationship not only in legal

terms but also based on the tacit element of trust. The benefit of trust, especially in instances

where a partnership has been successful, enables an NGO to draw on this past relationship due to

the credibility that has been established. The transferability of this credibility, it can be argued,

thereby becomes the base for further development on communication and the third sector initiative.

6.3.4. Section Summary In order to benefit from a CSMP, it is not only important that an awareness of environmental and

societal aspects is considered but also how these aspects can be effectively incorporated into the

stakeholder mapping process. Through a consideration of the role of trust in the application of the

CSMP, it is argued that it is possible for an organisation to maximise the benefits attainable from an

inclusionary approach to the stakeholder mapping process. As such, the development and role of

trust is significant and is an aspect which can facilitate communication between and across societal

levels: local, national, and global spheres.

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6.4. Sub-Conclusion

Through a change in mindset, the possibility exists that an inclusionary approach to stakeholder

mapping can be established. This possibility is established through the development of the CSMP

which it can be argued facilitates the framework necessary for an emergent approach to the

identification of societal and environmental factors which can affect stakeholders. As such,

managers are a central aspect in the promotion of a change in mindset, and it is through their role

as facilitators or gatekeepers that stakeholder involvement is encouraged. In order to promote this

change in mindset, it is necessary that managers are prepared to facilitate this change in mindset

through a strategy development and communication process that acknowledges the role of

individuals. Consequently, as communication is an essential part of strategy development and the

communication of this, it is argued that meaning construction is of particular significance for an

organisation that wishes to communicate a change in mindset. Furthermore, through a

consideration of the role of trust in the application of the CSMP, it is argued that it is possible for an

organisation to maximise the benefits attainable from an inclusionary approach to the stakeholder

mapping process.

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7. Conclusion

The main purpose of the thesis has been to address the potential for a change in mindset through

the creation of a further theoretical perspective on the stakeholder mapping process. The need for

a change in mindset is caused by the increase in private and public business activities in the 21st

century which have resulted in the redefinition of traditional boundaries and an increase in the

social divide. This social divide has necessitated an inclusionary approach to the stakeholder

mapping process, during which a comprehensive overview of stakeholder requirements can be

achieved. The achievement of this overview can potentially facilitate business-society relationships.

In an attempt to address the increase in the social demand for ethical business practices,

organisations are increasingly entering into partnerships. These partnerships, which are guided by

corporate citizenship activities, can be perceived as an organisation’s attempt to act responsibly

and generate value for both the organisation and society through an acknowledgement of the legal

and regulatory mandates set by society. These business activities may potentially overlap with third

sector initiatives by non-profit and non-governmental organisations. Non-profit and non-

governmental organisations today have become interwoven in the fabric of society in the 21 st

century, and they provide society and marginalised communities with a more powerful voice in the

decision making and resource allocation process. The identification and allocation of this

responsibility has traditionally been aided by a static visual representation of stakeholders which

does not allow for the dynamic societal and environmental factors which characterise contemporary

business.

Based on the dynamic nature of business and society in the 21st century, it is necessary that the

theoretical underpinnings upon which strategy and communication processes are based

acknowledge this dynamism. It is therefore essential that a balance is created between theoretical

underpinnings and the application of these in the context of the issue in focus. For that reason, it is

proposed that in order to facilitate the identification and allocation of organisational resources in the

third sector, the process by which requirements are identified needs to acknowledge the complexity

surrounding these requirements. It is however necessary to acknowledge the cognitive strength of

the traditional stakeholder model which, due to its generic design, has led to its indiscriminate

application across all business sectors. As stakeholder requirements can be seen to differ

considerably in the third sector from those of the private and public sector, it has been proposed

that a contemporary approach to how stakeholders are mapped in the third sector can potentially

facilitate an inclusionary approach to the stakeholder mapping process. Consequently, for a

contemporary stakeholder mapping process to facilitate the communication of sector specific

requirements in a third sector business-society relationship, it is proposed that a Contemporary

Stakeholder Mapping Process (CSMP) is applied by third sector organisations in order to

effectively address the identification and allocation of resources. The guiding principle behind the

CSMP is the recognition of the ‘core focus’ as the nexus of an organisation’s mapping process,

which through a consideration of the impact of the ‘spheres of societal impact’ and ‘society and

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structural aspects’ can identify the requirements of a marginalised community. To further place the

CSMP into perspective, it has been discussed to which extent contemporary business-society

relationships rely on aspects of trust and individual meaning construction. Accordingly, to fully

benefit from a contemporary approach to stakeholder mapping, it is essential that the relevance of

a gatekeeper is acknowledged as it is through the gatekeeper that effectual stakeholder mapping is

made possible and an organisation’s communication strategy facilitated. This need for a context

specific mapping process is a necessity in the third sector, where global society and community

formations are in a constant state of flux. As a tool to bring about a change in mindset and thereby

facilitate communication strategies in the third sector, the Contemporary Stakeholder Mapping

Process enables an inclusionary approach to stakeholder mapping.

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8. Future Consideration

While the potential benefits to be gained from visual representations of stakeholders have a

positive aspect, it is also necessary to consider the extent to which these visual representations

have made allowance for cultural aspects. As Kuhn (2012:44) explains, entities such as

organisations and institutional fields are favoured on a macro level, with individuals, groups, and

routines considered on a micro level. Kuhn (2012: 44) clarifies that a difference exists between

macro and micro level considerations, that is macro level considerations relate to organisational

theory, and micro level considerations to organisational behaviour. When applying visual

representations, which are based on theoretical concepts and depend on individuals for the

application of this theory, it is therefore necessary to consider the implications of the origins of this

theory. Numerous authors, in an effort to address the theoretical foundation of stakeholder

management, corporate citizenship, and third sector mechanisms, have developed theories which

offer a tool with which to gain insight into these theoretical fields. These theories are however

mainly developed against the backdrop of wealthier western countries. The implications of this,

according to Anheier (2005:120), is that these theories can be seen to apply to developed, liberal

market economies first and foremost, and have limited applicability in other economic systems

such as for example transition economies. Additionally, if one considers for example corporate

citizenship and third sector theory, developed by Crane et al. and Anheier respectively, these

theories also find their roots in western theoretical assumptions. Many of these authors also come

from wealthy first world countries which traditionally have not been affected by the same social

inequality and structural irregularities as less developed countries. The effect of this western focus

to theory development can be seen to present a possible cross cultural dilemma. Consequently, as

communication is context specific and develops through the interaction of individuals, this

interaction being both implicit and explicit, the need therefore exists for a closer examination of the

implication of applying theory which is grounded in western thinking, yet which is taught and

applied both in both eastern and western cultures.

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