Making Sense of Stigmatized Organizations: Labelling Contests and Power Dynamics in Social Evaluation Processes

Abstract

How do social audiences negotiate and handle stigmatized organizations? What role do their heterogenous values, norms and power play in this process? Addressing these questions is important from a business ethics perspective to improve our understanding of the ethical standards against which organizations are judged as well as the involved prosecutorial incentives. Moreover, it illuminates ethical concerns about when and how (the exploitation of) power imbalances may induce inequity in the burdens imposed by such social evaluations. We address these questions building on two event-based case studies involving Hells Angels Motorcycle Club Norway, and contribute to organizational stigma theory in three ways. First, social evaluations of a stigmatized organization by multiple audiences are found to interact, collide and combine in a labelling contest. Second, we show that labels employed in this contest are pushed to either negative extremes (‘moral panic’) or positive extremes (‘moral patronage’). Finally, we show when and how power represents a double-edged sword in social evaluation processes, which can be wielded either to the benefit or to the detriment of the actors under evaluation.

Standing on the Shoulders of Goffman: Advancing a Relational Research Agenda on Stigma

“…Moreover, Piazza and Perretti (2015) argue that Similar to individuals, organizations may be stigmatized because of their: (i) appearance, as in the case of "dot-com" firms after the bursting of the Internet bubble (Glynn & Marquis, 2004); (ii) behavior, such as in the case of organizational misconduct (Greve et al, 2010); or, (iii) group membership, as in the case of the arms industry. (Vergne, 2012) Although variations in the sources of stigma can be identified from the different theoretical lenses used, three things are common: (a) the normative drivers of social audiences' evaluations are essential (Kvåle & Murdoch, 2022a) to uncover the origins of stigma; (b) key audiences such as the media and the government play a critical role (Hampel & Tracey, 2017;Reuber & Fischer, 2010;Roulet, 2015Roulet, , 2020 in directing the public's attention toward or away from the stigmatizing attributes (Piazza & Perretti, 2015;Vergne, 2012); and (c) power is the mechanism through which a stigmatizing label is enacted as a means of social control (Hudson, 2008;Hudson & Okhuysen, 2014;Link & Phelan, 2001).…”

“…Although variations in the sources of stigma can be identified from the different theoretical lenses used, three things are common: (a) the normative drivers of social audiences’ evaluations are essential (Kvåle & Murdoch, 2022a) to uncover the origins of stigma; (b) key audiences such as the media and the government play a critical role (Hampel & Tracey, 2017; Reuber & Fischer, 2010; Roulet, 2015, 2020) in directing the public’s attention toward or away from the stigmatizing attributes (Piazza & Perretti, 2015; Vergne, 2012); and (c) power is the mechanism through which a stigmatizing label is enacted as a means of social control (Hudson, 2008; Hudson & Okhuysen, 2014; Link & Phelan, 2001).…”

“…Supportive audiences are motivated to obtain social and economic benefits from their interactions with targets (Helms & Patterson, 2014). Yet, they do not take visible and salient support positions most likely to avoid stigma transfer (Kvåle & Murdoch, 2022a). As noted, while some supportive audiences have the legitimacy and power to overcome efforts of stigmatizing audiences, others do not.…”

“…Second, there is rapidly growing theoretical interest in audiences who work with stigmatized or marginalized actors and, therefore, may experience stigma transfer (Bruyaka et al, 2018; Desai, 2011; Hudson & Okhuysen, 2009; Janney & Gove, 2011; Pontikes et al, 2010; Pozner, 2008). Overall, the interest of scholars in understanding and serving the marginalized (Tracey & Phillips, 2016), and the democratization of social media audiences with the ability to project negative labels and accounts (Roulet & Clemente, 2018) which can have significant implications for businesses and society (Kvåle & Murdoch, 2022a), and the extraordinary and increasing impact that social evaluations like stigma have (Pollock et al, 2019) ensure the persistence of stigma studies.…”

Shame On You! Unpacking the Individual and Organizational Implications of Engaging with a Stigmatized Organization

“…A smaller second strand of literature directs attention instead to the role of evaluators outside stigmatized organizations. These studies aim to assess how opposing evaluations by multiple social audiences interact to define what is normal and what is stigmatized (Ertug et al, 2016; Kvåle and Murdoch, 2021; Shadnam et al, 2020).…”