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S Y M P O S I U M
RESPONSIBLE LEADERSHIP AND STAKEHOLDER
MANAGEMENT: INFLUENCE PATHWAYS AND
ORGANIZATIONAL OUTCOMES
JONATHAN P. DOH
NARDA R. QUIGLEY
Villanova University
The construct of responsible leadership has gained considerable traction in contemporary management scholarship. Yet defining and operationalizing how responsible
leadership manifests in organizational outcomes has posed challenges. In this paper,
we draw from stakeholder theory to offer a more fully formed view of how responsible
leadership influences organizational processes and outcomes. We provide descriptions
of two distinct pathways through which leaders and their organizations exhibit and
project their responsible leadership behaviors and actions: psychological and knowledge-based. We suggest that these two pathways constitute process mechanisms that
advance and disseminate specific signals and messages and, ultimately, actions and
outcomes. We provide brief illustrations of three companies and their leaders to
underscore the potential of our framework. We conclude with implications for research and practice.
challenges. For example, Siegel (in Waldman & Siegel, 2008) suggested that truly responsible leadership must include the strategic use of CSR, such
that leaders leverage CSR instrumentally to benefit
shareholders. Waldman (also in Waldman & Siegel,
2008) argued against such rigid instrumentality,
suggesting instead that responsible leadership must
involve multiple stakeholder groups in decision
making because doing so supports the firms longterm sustainability. These two contrasting perspectives underscore the nascent condition of the responsible leadership construct and the need to
further elaborate the processes through which responsible leadership manifests in organizational
outcomes.
In this paper, we seek to partially reconcile these
divergent perspectives (and others) by drawing
from stakeholder theory (cf. Cragg, 2002; Donaldson & Preston, 1995) to contribute to a more fully
developed theory of responsible leadership. Prior
research suggests that a stakeholder approach to
management is positively associated with longterm performance (e.g., Cragg, 2002; Rowley & Berman, 2000). Indeed, the ongoing viability and sur-
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that these two pathways constitute process mechanisms that direct and disseminate specific signals
and messages and, ultimately, actions and outcomes. We provide brief illustrations of three companies and their leaders to underscore the potential
of our framework. We conclude with implications
for research and practice. This approach should be
viewed as a complement that can augment the classic do no harm and do good dimensions of the
responsible leadership construct that have appeared in prior literature. Before addressing the
two pathways, we first review recent research that
has explored the relationship between responsible
leadership and stakeholder management.
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ship is most likely to occur among social entrepreneursthose individuals who believe that the purpose of their business is to create innovative
solutions to societal problems (Mair & Marti, 2006;
Nicholls & Cho, 2006) while maintaining some
level of self-sustainability (rather than necessarily
profits).
These leaders must balance their emotional concern for a targeted group of stakeholders who are in
need with the rational demands associated with
running the organization, which often proves to be
difficult. In any case, the idealists approach tends
to be very servant-based, in that he or she is serving
the needs of a set of targeted stakeholders (e.g.,
Mittal & Dorfman, 2012; Sendjaya, Sarros, & Santora, 2008; Van Dierendonck, 2011). Interestingly,
Pless and colleagues (2012) did not explicitly tie
the different orientations toward responsible leadership to leadership effectiveness, likely because
there are few empirical studies to support this connection. Moreover, the literature to date has not
fully specified the pathways through which responsible leaders exert their unique abilities to influence organizational processes and outcomes.
Beyond Shareholders: The Responsibilities of
Responsible Leaders
In considering the emergent work on the connection between responsible leadership and stakeholder management, the literature is converging on
the idea that responsible leaders have a view of
their personal accountability that goes beyond serving the needs of shareholders/owners alone. Responsible leadership also likely requires a proactive dialogue with other stakeholders who will be
affected by the actions of the organization. This
kind of an approach requires a particularly open,
transparent, and confident leadership orientation,
such that the leader is able to both interact with and
prioritize stakeholders effectively and detect cues
and emergent trends so that they can be incorporated
into firm strategy and organizational processes. In the
next section, we discuss how responsible leaders may
influence organizational dynamics and, in so doing,
shape organizational outcomes.
RESPONSIBLE LEADERSHIP, INFLUENCE
PATHWAYS, AND ORGANIZATIONAL
OUTCOMES
Leaders clearly can influence multiple levels of
analysis in and around organizations (e.g., Yukl,
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2012). While Voegtlin and colleagues (2012) considered the positive outcomes associated with responsible leadership at the macro, meso, and micro
levels, here we explicate how leaders may influence such outcomes through stakeholder engagement. We highlight two pathways through which
responsible leaders using a stakeholder approach
may engender positive outcomes: psychological
and knowledge-based (see Figure 1).
Pathway 1: Psychological Benefits of Responsible
Leadership
While research that explicitly examines how the
stakeholder approach works at the individual level
is scarcefor the simple reason that the literature
on stakeholder theory has tended to be more macro
in nature (e.g., Donaldson & Preston, 1995)a responsible leadership approach that is more inclusive of the needs of various stakeholder groups is
likely to resonate psychologically at the individual
level, resulting in higher levels of engagement with
the organization. The broader leadership literature
within organizational behavior has much to add to
our understanding of why a stakeholder-oriented
approach may be particularly effective in terms of
psychologically motivating and influencing employees. Sully de Luque and colleagues (2008), for
example, using a cross-cultural sample of CEOs and
their followers, provided convincing evidence that
when leaders assign a greater level of importance to
stakeholders, subordinates perceive them as more
visionary (rather than autocratic). This, in turn,
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FIGURE 1
Proposed Model: Responsible Leadership, Pathways, and Outcomes
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knowledge sharing. Therefore, the knowledgebased pathway clearly represents a set of mechanisms that responsible leaders taking a broad approach to stakeholders can use to positively
influence outcomes at multiple levels of analysis.
We acknowledge that this perspective is somewhat
idealized; in reality, it must be balanced with time
management, resource constraints, and bounded
rationality (Voegtlin et al., 2012).
Last, we note that the psychological and knowledge-based pathways are not entirely discrete or
mutually exclusive, although we have discussed
them separately here for the purposes of clarity.
Rather, they can and do coexist, either in a temporally concurrent or sequential fashion. That is, behavior and action resulting from the psychological
pathway may precede that which emanates from
the knowledge-based pathway (e.g., the Walmart
example we discuss below) or vice versa (the Coke
and DuPont examples, also below). Moreover, as
shown in Figure 1, these cases underscore the reality that these pathways are often mutually reinforcing, dynamic, and recursive, such that movement on one begets action on the other and
vice versa.
In the next section we provide three brief examples from the world of corporate sustainability to
illustrate our perspective and the explanatory
power of the psychological and knowledge-based
pathways.
RESPONSIBLE LEADERSHIP PATHWAYS:
EXAMPLES FROM CORPORATE
SUSTAINABILITY LEADERSHIP
Sustainability has emerged as an important societal issue and one that corporations have begun to
incorporate into their business strategy and their
broader social engagement (Bansal, 2002; Orlitzky,
Siegel, & Waldman, 2011). Organizational leaders
are recognizing that addressing sustainability challenges may improve their standing with their stakeholders and potentially translate into a stronger
reputation (Flammer, 2013). Significant variance
exists, however, in what firms and leaders believe
are the potential benefits of committing to sustainable management practices (Aguilera, Rupp, Williams, & Ganapathi, 2007). Anecdotal evidence suggests that individual leaders can have a profound
impact on a companys decision to move affirmatively toward a more sustainable business model.
Often, a crisis or personal epiphany is the catalyst that drives a leaderand the companyin the
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the psychological pathway, the personal experiences and dedication of Cokes leaders offered the
potential to spill over to the organizations culture,
although it is difficult to discern the depth and
breadth of that effect from secondary sources alone.
It is clear, however, that both Isdell and Kent embodied a deep personal commitment to sustainability, and that those psychological commitments
were increasingly used to galvanize Coca-Colas
employees. Ultimately, the knowledge-based and
psychological pathways appear to have converged
in these two leaders ability to mobilize CocaColaand many other individuals and organizationsto this mission of responsible environmental leadership.
DuPont and Chad Holliday
DuPont was one of the codevelopers of ozonedepleting chlorofluorocarbons (CFCs) used in refrigerants and aerosol spray cans, and in the 1980s
the company was one of the largest producers of
CFCs in the world, with a 25% market share. It was
also the target of aggressive criticism from NGOs
such as Greenpeace, whose members scaled one of
its plants facing a highway (on which thousands of
drivers passed each day) to hang a banner that read,
Number 1 in contributing to destruction of the
ozone layer. Like Coca-Cola, DuPont faced a serious crisis, and leaders sought to change the context
and process for decision making. Again, both the
knowledge-based and psychological pathways provided mechanisms to facilitate change.
DuPont has made a great deal of progress toward
sustainability in the ensuing years, first under the
leadership of Chad Holliday and then under Ellen
Kullman. The companys recent strong commitment to environmental sustainability has included
phasing out the production of CFCs, dramatically
improving energy efficiency at its plants around the
world, substantially reducing water use and waste,
and developing new energy-saving products and
services such as Tyvek building insulation. DuPont
has since received a number of awards for its sustainability accomplishments. For his part, Holliday
has served on numerous NGO boards and government committees, including the ClimateWorks
Foundation, and acted as co-chair of the UN Secretary-Generals High-Level Group on Sustainable
Energy for All.
From 2000 to 2010, when he retired, Holliday
frequently commented on his philosophy and rationale for moving DuPont toward a more sustain-
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As a responsible leader, Holliday used the knowledge-based pathway to increase the psychological
commitment of DuPonts employees to his sustainability initiatives. Like Coke, DuPont also recognized the need to open up its organizational boundaries and engage with nontraditional stakeholders,
such as NGOs. Holliday noted:
Twice a year, DuPont invited about 10 NGOs to a
meeting with about 10 of the companys business
leaders. . . . The first meeting we had was tough, but
it was amazing how the experience opened us up. It
helped us understand the sensitivities in a variety of
areas, as well as how NGOs thought, and we went
about accomplishing our strategy differently as a
result. Sometimes we actually identified market
opportunities because of the dialogues. . . . These
experiences also enabled us to avoid a lot of conflicts because we learned where the hot spots
were. And we developed such good relationships
with NGOs that they were willing to help us. When
DuPont did face a situation and the press called
these NGOs, they were able to explain our views
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This passage underscores a fairly substantial reorientation in the process through which DuPont as an
organization acquired, processed, and disseminated knowledge from and to its stakeholders.
Based on Hollidays comments, it seems that DuPont was actually engaging in an organization-wide
responsible leadership development initiative with
the explicit purpose of training leaders to be able to
incorporate the views of multiple stakeholders in
their decision-making processes.
Ellen Kullman, who succeeded Holliday as chair
and CEO of DuPont, has maintained DuPonts commitment to sustainable enterprise. In a recent interview with Leaders magazine (2012, p. 20), she
remarked:
When I joined DuPont in the 1980s, sustainability
was very important to the then CEO. He called himself a chief environmental officer he was a real
pioneer. Chad Holliday also championed sustainable development, so its embedded now in what we
do. We not only think about footprint reduction
when we think about sustainability; we think about
it from a numerator standpoint, how we create products that keep the environment or the world safe.
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ideas presented as potentially threatening and critical. This willingness to engage with critical external stakeholders was a hallmark of DuPonts sustainability experience. Indeed, DuPont appeared to
sometimes engage with fringe stakeholders to
gain important knowledge (Hart & Sharma, 2004).
In addition, DuPont pursued several innovative
mechanisms for sharing knowledge and encouraging participatory development of the sustainability
program. The personal commitment and interest of
DuPonts leaders also suggest activity along the
psychological pathway, although that influence,
again, is not as clear or evident as the knowledgebased pathway.
It is important to reiterate that the examples
above reflect only the positive attributes of responsible leadership exhibited by these leaders. Each
has also been faulted for several mistakes, errors,
and even transgressions. We have deliberately and
intentionally included only those leadership attributes that help to reveal the pathways of influence
of responsible leadership that we outlined above.
Table 1 provides a summary of these cases, noting the leaders involved, the primary impetus that
resulted in an increase in responsible leadership,
the main pathways through which responsible
leadership had an impact, and the levels of affected
outcomes.
CONCLUSIONS AND FUTURE RESEARCH
It is clear that our understanding of the concept
of responsible leadership is evolving and becoming
more defined as more scholarship appears on the
subject. We have tried here to further link the responsible leadership (and the broader leadership)
literature to stakeholder theory by explicating the
pathways through which responsible leaders influence outcomes at multiple levels of analysis within
organizations. Further, we have attempted to show
how responsible leaders who take an open and
inclusive approach to understanding and incorpo-
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TABLE 1
Corporate Sustainability and Responsible Leadership Pathways at Walmart, Coca-Cola, and DuPont
Company
Walmart
Coca-Cola
DuPont
Leaders
Rob Walton
Lee Scott
Neville Isdell
Muhtar Kent
Chad Holliday
Ellen Kullman
Initial prompt
Pathway
Primarily psychological
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communicate with the stakeholders who are critical to their ability to make good decisions?
Finally, future work should examine empirically
whether the pathways we have proposed here are
as important as theory would suggest critically,
the linkages and interactions among these pathways, leadership characteristics, and outcomes
need attention. In particular, we have suggested
that our model portrays a reflexive and dynamic
process, but we have provided only anecdotal evidence of that. We also make some inferences about
succession and the influence of prior leaders on their
successors (e.g., Holliday and Kullman, Isdell and
Kent, and Walton and Scott), although this very important process deserves more comprehensive analysis and scrutiny.
Future research should also examine whether
there are best practices or preferred methods by
which leaders can manage the flow of knowledge
with critical stakeholders. Even more broadly, we
still need to know more about how responsible
leaders prioritize stakeholder groups such that they
can manage communication and knowledge-sharing in a logical fashion. It is clear that much work
remains to be done on the practical side of responsible leadershipwhich leads one to ask, what can
we do, on the academic/research side, to provide
advice and/or assistance to those leaders who wish
to be considered as responsible as part of their
legacy? These and other questions must continue to
be examined in future research on responsible leadership. We hope to have provided a start in this
direction.
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