Purpose This paper aims to clarify the relationship between the voting and engagement behaviour o... more Purpose This paper aims to clarify the relationship between the voting and engagement behaviour of institutional investors, i.e. institutional investor stewardship behaviour, and the enactment of stewardship by corporate boards. In doing so, this paper contributes to the evaluation of contemporary corporate governance systems and provides recommendations for the redesign of these systems. Design/methodology/approach This paper is based on a qualitative exploratory descriptive research study into assumed, prescribed and the actual behaviour of institutional investors. Their behaviour is explored through a survey and in-depth interviews with global institutional investors. Findings The prescription of institutional investor stewardship behaviour and the exploration of actual behaviour from an investors’ perspective led to the conclusion that assumed institutional investor stewardship exists variously as either “in form” (i.e. measured by compliance to the relevant corporate governance code) or “in substance” (i.e. the actual behaviour from the investors and investee companies’ perspective). The results suggest that that institutional investors’ actual stewardship behaviour as global investors requires a nuanced conclusion about the existence of institutional investor stewardship. Research limitations/implications Although the number of semi-structured interviews with institutional investors was limited to just 14, these interviewees represent the majority share in terms of market capitalisation of Dutch listed companies. Additional research could clarify the perspective of other investors, such as pension funds and private investors. Practical implications The outcome of this research can serve as input for corporate governance reforms in the preambles of governance codes and the prescribed principles and best practice provisions of corporate governance and stewardship codes. This research identifies opportunities for further academic research to enrich the understanding of the role of institutional investors in enacting corporate stewardship. Social implications This paper contributes to furthering the understanding of the mechanisms by which institutional investors, through their behaviour, contribute to enacting stewardship through their corporate boards. This is an important part of the corporate social responsibility of institutional investors. It also triggers a dialogue about the social and environmental impacts of stock listed companies. Originality/value This paper fulfils an identified need to develop knowledge about new paradigms and offers a more integrated approach to corporate governance reforms in terms of the role of institutional shareholders in the promotion of good corporate governance.
ABSTRACT The classic divide between the state and the market is fading. Increasingly, companies a... more ABSTRACT The classic divide between the state and the market is fading. Increasingly, companies are being held accountable for issues such as fair trade, environmental degradation and the socioeconomic situation in a region. Companies are asked to expand their corporate agenda. The corporate world realises that it cannot ignore this societal demand for a broader responsibility. It realises that companies could also benefit themselves from corporate social responsibility (CSR). Working on CSR means that an organisation tries to take into account additional values and responsibilities, with a long-term perspective, in order to anticipate the expectations and critical viewpoints of all parties involved. Implementing CSR requires a company's perspective to be reoriented so that new relationships can be formed, new values can be defined, and new strategies can emerge in order to redefine the corporate responsibilities. This is more than just another business project. Ultimately, it involves revisiting the very core of the organisation, and this poses some important challenges for organisations. The question we put forward in this article is: how can an organisation become competent in terms of CSR? We argue that CSR is both process and content: companies learn in a stepwise manner how to strengthen CSR competencies such as integrity, loyalty, and quality. Further, it is assumed in this paper that individuals alone cannot meet the challenges in CSR. They also require certain competencies on a collective level, competencies that have to be developed organisationwide. The structure of this article is as follows. Firstly, we present CSR as a strategic challenge (Section 2). We argue that an organisation needs new competencies in order to develop CSR. Next, we reason why these competencies need to be developed 3 This paper stems from a research project that is currently being implemented by a consortium of the University of Twente, University of Nijmegen, and Nyenrode University (all in the Netherlands). It is part of a research programme on CSR by the Dutch Ministry of Economic Affairs. The focus of our project is on identifying strategies, mechanisms, and instruments that organisations may employ in embedding CSR. Particular attention is paid to the question of how organisations can ensure that CSR is not a one-off experience but becomes relevant throughout the organisation. The empirical part of the research consists of in-depth case studies within four Dutch companies. The experiences within these companies as well as the theoretical debate within the consortium have guided us when writing the paper.
Journal of sustainable finance & investment, Jul 3, 2015
This is the first literature review on Socially Responsible Investment (SRI) funds. Although SRI ... more This is the first literature review on Socially Responsible Investment (SRI) funds. Although SRI funds flourish, we know very little about these investment vehicles. This article reviews academic literature on SRI funds published during the past 25 years. It discusses the current state of theoretical research on SRI funds and identifies future research opportunities by analysing the characteristics, contents and methodological aspects of the literature and identifying research priorities and strategic options. Current research on SRI funds, it is shown, typically departs from a financial perspective and focuses predominantly on financial performance. In addition, most research is produced at European and North American universities, and there is little attention for social performance or discussion about the principles underlying SRI funds. We therefore argue that important future research opportunities exist with regard to the promise of SRI funds to attain both their financial and social goals.
ABSTRACT The classic divide between the state and the market is fading. Increasingly, companies a... more ABSTRACT The classic divide between the state and the market is fading. Increasingly, companies are being held accountable for issues such as fair trade, environmental degradation and the socioeconomic situation in a region. Companies are asked to expand their corporate agenda. The corporate world realises that it cannot ignore this societal demand for a broader responsibility. It realises that companies could also benefit themselves from corporate social responsibility (CSR). Working on CSR means that an organisation tries to take into account additional values and responsibilities, with a long-term perspective, in order to anticipate the expectations and critical viewpoints of all parties involved. Implementing CSR requires a company's perspective to be reoriented so that new relationships can be formed, new values can be defined, and new strategies can emerge in order to redefine the corporate responsibilities. This is more than just another business project. Ultimately, it involves revisiting the very core of the organisation, and this poses some important challenges for organisations. The question we put forward in this article is: how can an organisation become competent in terms of CSR? We argue that CSR is both process and content: companies learn in a stepwise manner how to strengthen CSR competencies such as integrity, loyalty, and quality. Further, it is assumed in this paper that individuals alone cannot meet the challenges in CSR. They also require certain competencies on a collective level, competencies that have to be developed organisationwide. The structure of this article is as follows. Firstly, we present CSR as a strategic challenge (Section 2). We argue that an organisation needs new competencies in order to develop CSR. Next, we reason why these competencies need to be developed 3 This paper stems from a research project that is currently being implemented by a consortium of the University of Twente, University of Nijmegen, and Nyenrode University (all in the Netherlands). It is part of a research programme on CSR by the Dutch Ministry of Economic Affairs. The focus of our project is on identifying strategies, mechanisms, and instruments that organisations may employ in embedding CSR. Particular attention is paid to the question of how organisations can ensure that CSR is not a one-off experience but becomes relevant throughout the organisation. The empirical part of the research consists of in-depth case studies within four Dutch companies. The experiences within these companies as well as the theoretical debate within the consortium have guided us when writing the paper.
This paper aims to enhance our understanding of the relationship between organizations' strat... more This paper aims to enhance our understanding of the relationship between organizations' strategic orientation (i.e., instrumental, equidistant, and stewardship) and their innovational strategy (i.e., organizational ambidexterity and open innovation), and this relationship's influence on their sustainability performance. We expected organizations' strategic orientation to influence their innovational strategy and exhibit better corporate sustainability. We focused on 12 different multinational organizations in the Eurozone and found that inbound open innovation acts as a driver for corporate sustainability while simultaneously positively enabling organizations to pursue both financial and social initiatives. After suggesting open innovation as a new corporate sustainability antecedent, we only found empirical evidence of inbound open innovation. However, we would suggest that if organizations incorporated outbound open innovation in their strategy, they could likely impro...
More and more organizations formulate a code of conduct to stimulate responsible action of people... more More and more organizations formulate a code of conduct to stimulate responsible action of people within the organization. Usually much time and energy is spent fixing the content of the code. Then there is the challenge of implementing and maintaining the code. This is a tricky process in which too many organizations get stuck. The code then turns into nothing but the notorious "paper in the drawer", so that the purpose of a responsible organization is not achieved. The challenge here is to utilize the awakening and dynamics that have originated with the formulation of the code to procure a continuous process of reflection on central values and standards. This paper presents an assessment method that can support this process.
The case can be ordered via The Case Centre, Reference no. 214-012-1 , Teaching note Reference no... more The case can be ordered via The Case Centre, Reference no. 214-012-1 , Teaching note Reference no. 214-012-8
Purpose This paper aims to clarify the relationship between the voting and engagement behaviour o... more Purpose This paper aims to clarify the relationship between the voting and engagement behaviour of institutional investors, i.e. institutional investor stewardship behaviour, and the enactment of stewardship by corporate boards. In doing so, this paper contributes to the evaluation of contemporary corporate governance systems and provides recommendations for the redesign of these systems. Design/methodology/approach This paper is based on a qualitative exploratory descriptive research study into assumed, prescribed and the actual behaviour of institutional investors. Their behaviour is explored through a survey and in-depth interviews with global institutional investors. Findings The prescription of institutional investor stewardship behaviour and the exploration of actual behaviour from an investors’ perspective led to the conclusion that assumed institutional investor stewardship exists variously as either “in form” (i.e. measured by compliance to the relevant corporate governance code) or “in substance” (i.e. the actual behaviour from the investors and investee companies’ perspective). The results suggest that that institutional investors’ actual stewardship behaviour as global investors requires a nuanced conclusion about the existence of institutional investor stewardship. Research limitations/implications Although the number of semi-structured interviews with institutional investors was limited to just 14, these interviewees represent the majority share in terms of market capitalisation of Dutch listed companies. Additional research could clarify the perspective of other investors, such as pension funds and private investors. Practical implications The outcome of this research can serve as input for corporate governance reforms in the preambles of governance codes and the prescribed principles and best practice provisions of corporate governance and stewardship codes. This research identifies opportunities for further academic research to enrich the understanding of the role of institutional investors in enacting corporate stewardship. Social implications This paper contributes to furthering the understanding of the mechanisms by which institutional investors, through their behaviour, contribute to enacting stewardship through their corporate boards. This is an important part of the corporate social responsibility of institutional investors. It also triggers a dialogue about the social and environmental impacts of stock listed companies. Originality/value This paper fulfils an identified need to develop knowledge about new paradigms and offers a more integrated approach to corporate governance reforms in terms of the role of institutional shareholders in the promotion of good corporate governance.
ABSTRACT The classic divide between the state and the market is fading. Increasingly, companies a... more ABSTRACT The classic divide between the state and the market is fading. Increasingly, companies are being held accountable for issues such as fair trade, environmental degradation and the socioeconomic situation in a region. Companies are asked to expand their corporate agenda. The corporate world realises that it cannot ignore this societal demand for a broader responsibility. It realises that companies could also benefit themselves from corporate social responsibility (CSR). Working on CSR means that an organisation tries to take into account additional values and responsibilities, with a long-term perspective, in order to anticipate the expectations and critical viewpoints of all parties involved. Implementing CSR requires a company's perspective to be reoriented so that new relationships can be formed, new values can be defined, and new strategies can emerge in order to redefine the corporate responsibilities. This is more than just another business project. Ultimately, it involves revisiting the very core of the organisation, and this poses some important challenges for organisations. The question we put forward in this article is: how can an organisation become competent in terms of CSR? We argue that CSR is both process and content: companies learn in a stepwise manner how to strengthen CSR competencies such as integrity, loyalty, and quality. Further, it is assumed in this paper that individuals alone cannot meet the challenges in CSR. They also require certain competencies on a collective level, competencies that have to be developed organisationwide. The structure of this article is as follows. Firstly, we present CSR as a strategic challenge (Section 2). We argue that an organisation needs new competencies in order to develop CSR. Next, we reason why these competencies need to be developed 3 This paper stems from a research project that is currently being implemented by a consortium of the University of Twente, University of Nijmegen, and Nyenrode University (all in the Netherlands). It is part of a research programme on CSR by the Dutch Ministry of Economic Affairs. The focus of our project is on identifying strategies, mechanisms, and instruments that organisations may employ in embedding CSR. Particular attention is paid to the question of how organisations can ensure that CSR is not a one-off experience but becomes relevant throughout the organisation. The empirical part of the research consists of in-depth case studies within four Dutch companies. The experiences within these companies as well as the theoretical debate within the consortium have guided us when writing the paper.
Journal of sustainable finance & investment, Jul 3, 2015
This is the first literature review on Socially Responsible Investment (SRI) funds. Although SRI ... more This is the first literature review on Socially Responsible Investment (SRI) funds. Although SRI funds flourish, we know very little about these investment vehicles. This article reviews academic literature on SRI funds published during the past 25 years. It discusses the current state of theoretical research on SRI funds and identifies future research opportunities by analysing the characteristics, contents and methodological aspects of the literature and identifying research priorities and strategic options. Current research on SRI funds, it is shown, typically departs from a financial perspective and focuses predominantly on financial performance. In addition, most research is produced at European and North American universities, and there is little attention for social performance or discussion about the principles underlying SRI funds. We therefore argue that important future research opportunities exist with regard to the promise of SRI funds to attain both their financial and social goals.
ABSTRACT The classic divide between the state and the market is fading. Increasingly, companies a... more ABSTRACT The classic divide between the state and the market is fading. Increasingly, companies are being held accountable for issues such as fair trade, environmental degradation and the socioeconomic situation in a region. Companies are asked to expand their corporate agenda. The corporate world realises that it cannot ignore this societal demand for a broader responsibility. It realises that companies could also benefit themselves from corporate social responsibility (CSR). Working on CSR means that an organisation tries to take into account additional values and responsibilities, with a long-term perspective, in order to anticipate the expectations and critical viewpoints of all parties involved. Implementing CSR requires a company's perspective to be reoriented so that new relationships can be formed, new values can be defined, and new strategies can emerge in order to redefine the corporate responsibilities. This is more than just another business project. Ultimately, it involves revisiting the very core of the organisation, and this poses some important challenges for organisations. The question we put forward in this article is: how can an organisation become competent in terms of CSR? We argue that CSR is both process and content: companies learn in a stepwise manner how to strengthen CSR competencies such as integrity, loyalty, and quality. Further, it is assumed in this paper that individuals alone cannot meet the challenges in CSR. They also require certain competencies on a collective level, competencies that have to be developed organisationwide. The structure of this article is as follows. Firstly, we present CSR as a strategic challenge (Section 2). We argue that an organisation needs new competencies in order to develop CSR. Next, we reason why these competencies need to be developed 3 This paper stems from a research project that is currently being implemented by a consortium of the University of Twente, University of Nijmegen, and Nyenrode University (all in the Netherlands). It is part of a research programme on CSR by the Dutch Ministry of Economic Affairs. The focus of our project is on identifying strategies, mechanisms, and instruments that organisations may employ in embedding CSR. Particular attention is paid to the question of how organisations can ensure that CSR is not a one-off experience but becomes relevant throughout the organisation. The empirical part of the research consists of in-depth case studies within four Dutch companies. The experiences within these companies as well as the theoretical debate within the consortium have guided us when writing the paper.
This paper aims to enhance our understanding of the relationship between organizations' strat... more This paper aims to enhance our understanding of the relationship between organizations' strategic orientation (i.e., instrumental, equidistant, and stewardship) and their innovational strategy (i.e., organizational ambidexterity and open innovation), and this relationship's influence on their sustainability performance. We expected organizations' strategic orientation to influence their innovational strategy and exhibit better corporate sustainability. We focused on 12 different multinational organizations in the Eurozone and found that inbound open innovation acts as a driver for corporate sustainability while simultaneously positively enabling organizations to pursue both financial and social initiatives. After suggesting open innovation as a new corporate sustainability antecedent, we only found empirical evidence of inbound open innovation. However, we would suggest that if organizations incorporated outbound open innovation in their strategy, they could likely impro...
More and more organizations formulate a code of conduct to stimulate responsible action of people... more More and more organizations formulate a code of conduct to stimulate responsible action of people within the organization. Usually much time and energy is spent fixing the content of the code. Then there is the challenge of implementing and maintaining the code. This is a tricky process in which too many organizations get stuck. The code then turns into nothing but the notorious "paper in the drawer", so that the purpose of a responsible organization is not achieved. The challenge here is to utilize the awakening and dynamics that have originated with the formulation of the code to procure a continuous process of reflection on central values and standards. This paper presents an assessment method that can support this process.
The case can be ordered via The Case Centre, Reference no. 214-012-1 , Teaching note Reference no... more The case can be ordered via The Case Centre, Reference no. 214-012-1 , Teaching note Reference no. 214-012-8
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