Activists as Moral Entrepreneurs: How Shareholder Activists Brought Active Ownership To Switzerland

Abstract

Action from activists is at the origin of many initiatives that end up injecting moral concerns into the way companies operate. In such instances, activists function as moral entrepreneurs that lastingly change the definition of what constitutes morally acceptable corporate behavior. Yet, in order to have such a lasting effect on companies, activist efforts need to pass through multiple stages that deal with both the effective mobilization of their own constituents and the triggering of corporate responses that can induce broader change in the economy. In the present article, we study how local shareholder activists initiated and helped sustain the process that led to the establishment of active ownership in Switzerland between 1997 and 2011. Active ownership refers to the active engagement of shareholders with firms to push them towards considering environmental, social, and corporate governance (ESG) criteria in their decision-making. The case illustrates the processual nature of moralizing dynamics initiated by activists and emphasizes the long-term and cumulative nature of many moralization projects.

The Fate of Social Modernity

“…In other areas, charismatic leaders in religious or political movements prove to be influential actors (Zúquete 2020). Some operate as moral entrepreneurs reforming institutions and organisations with reference to their own values (Becker 1995;Waeger and Mena 2019). In all these dimensions, individual agency matters greatly to modern societies.…”

Keep Your Eyes on the Prize: A goals-based approach to studying social movements in markets

“…Regarding the latter, the spread of new practices in an organizational field happens because later adopters imitate earlier adopters of these practices. We know that such imitation accelerates when firms that were formerly known for resisting the alteration movement switch their stance and adopt the promoted practice (Briscoe & Safford, 2008; Waeger & Mena, 2019) or when firms have made changes on the basis of accumulating evidence, rather than confrontational interactions with movements (Briscoe et al, 2015). There are also less voluntary forms of spread, for instance when these new practices become part of supply chain governance at lead firms (Levy, 2008) or when trade associations (Van Wijk et al, 2013) and private regulatory initiatives (Bartley, 2018; Haack & Rasche, 2021) require member firms to adopt them.…”

Capitalizing on Capitalism: How Impact Investing in Geneva Emerged among the Traditional Financial Field

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