The Strategic Cognition View of Issue Salience and the Evolution of a Political Issue: Landis & Gyr, the Hungarian Uprising and East-West Trade, 1953–1967

Abstract

Why do firms facing similar stakeholder issues respond quite differently? The recently introduced strategic cognition view of issue salience and firm responsiveness (hereinafter: issue salience model) seeks to tackle this core question of stakeholder theory. I extend the nascent theorizing with a historical case study in order to rethink the model's firm-centric perspective. The firm under examination in this historical case study is the Swiss multinational Landis & Gyr (LG) during the Cold War period. Like many other Swiss exportoriented companies in the 1950s and early 1960s, LG was challenged by Swiss pressure groups, which were highly effective at putting an issue on the public agenda: the call to break off trade relations with the communist East. The empirically grounded explanation of issue interpretation and response mechanisms derived from this case study offers two key theoretical implications: First, it shifts our focus outwards, toward the social and political context, in which issues evolve and play out over time. This elaboration seeks to understand the role of the social and political surroundings in constituting firm-specific issue interpretation processes and response outcomes. Second, the findings suggest that the issue salience model emphasizes an overly homogenizing conception of the firm. By pointing towards the tensions and ambiguities in a firm's collective sensemaking efforts, I start a critique of the theory in order to push this important stream of research further.