Abstract:
In recent years, stakeholders have put pressure on organizations to increase their social and environmental performance, and stakeholder engagement has become a strategic instrument of corporate social responsibility. This thesis aims to explore the association between stakeholder engagement and the corporate sustainability performance, while considering the moderating impact of the country’s stakeholder-orientation. To do so, a sample of 80 European public firms was selected, and data was gathered in a unique panel data covering three-year period. First, content analysis of CSR reports was performed to assess the stakeholder engagement score, based on a self-constructed index. Results show a general improvement of SE process, with firms performing higher SE scores over time. Subsequently, the empirical analysis is carried out through a pooled OLS regression. The results support the positive and significant association between CSP and SE, meaning that involving stakeholders in the decision-making process helps firms to address social and environmental issues more effectively and to improve the CSP. This positive association is stronger for firms headquartered in stakeholder-oriented countries. This study extents current literature on stakeholder theory and on the operationalization and measurement of stakeholder engagement.
