How Scandals Act as Catalysts of Fringe Stakeholders’ Contentious Actions Against Multinational Corporations

Abstract

In this article, we build on the stakeholder-politics literature to investigate how corporate scandals transform political contexts and give impetus to the contentious movements of fringe stakeholders against multinational corporations (MNCs). Based on Adut’s scandal theory, we flesh out three scandal-related processes that directly affect political-opportunity structures (POSs) and the generation of social movements against MNCs: convergence of contention toward a single target, publicization of deviant practices, and contagion to other organizations. These processes reduce the obstacles to collective actions by fringe stakeholders by pushing corporate elites to be more sensitive to their claims, by decreasing MNCs’ capability to repress contentious movements, by forcing the targeted MNCs to formalize a policy to monitor and eradicate the controversial practices, and by helping fringe stakeholders find internal and external allies to support their claims. This conceptual model of scandals as catalysts of contentious actions contributes to a better understanding of stakeholder politics by unveiling the role of the political context in the coordination of fringe stakeholders.

Blame Game Theory: Scapegoating, Whistleblowing and Discursive Struggles following Accusations of Organizational Misconduct

“…In particular, we suggest that given the difficulty in morally evaluating and attributing responsibility for misconduct in complex organizations and settings, accused actors will attempt to influence audiences’ sensemaking by employing discursive strategies aimed at avoiding blame. Rather than focusing on blame games as a sensemaking process that generates explanatory content (Boudes & Laroche, 2009), we argue that blame games potentially disturb the sensemaking processes in the aftermath of an accusation of misconduct (Daudigeos, Roulet, & Valiorgue, 2020). Our theory highlights the agency that accused actors have to actively shape the social construction of misconduct, thereby revealing the potential for manipulation by these actors.…”

“…The validity of claims made by scapegoating or whistleblowing could be examined, and the level of caution to be exercised would depend on interpreting the available evidence. When a scandal makes organizational misconduct visible (Daudigeos et al, 2020), stakeholders will be tempted to take existing discourses at face value, and follow the majority point of view (Adut, 2005; Clemente & Roulet, 2015). Our framework serves as a useful reminder that the discursive positions taken by actors suspected of misconduct serve as a strategic tool to influence the meaning-making of audiences.…”

Greenwashing and public demand for government regulation

“…The term "private politics" refers to "actions by private interests such as activists that target private agents, often in the institution of public sentiment" (Baron and Diermeier, 2007, p.600). By and large, this includes different forms of activism against firms' business conduct, most prominently by means of coordinated boycotts of firms' products (Daudigeos et al, 2018;Endres and Panagopoulos, 2017;McDonnell et al, 2015). In contrast to private politics mechanisms, the question if corporate business conduct is subject to accountability via a public politics mechanism -citizens' attitudes towards firms and citizens' regulatory preferences in particular -is much less well-understood (McDonnell and Werner, 2016).…”

Greening the Economy Through Voluntary Private Sector Initiatives or Government Regulation? A Public Opinion Perspective

“…Conversely, the belief in a reactive greening process implies that private sector actors will reduce the environmental impact of their business only when societal or regulatory pressures become strong (Boiral and Heras-Saizarbitoria, 2017;Daudigeos et al, 2018). If, indeed, firms mainly responded to external motivations, corporate environmentalism would be rather about appearance than about substance due to the absence of incentives that make firms automatically develop and adapt their business models in a pro-environmental way.…”