Stakeholder 360TM
  

                          Social Capital, Sustainable Development, and the Corporation       espaņol

  
   by Robert Boutilier, Ph.D.
  
 
 
 
Social Capital and Business
 
    
 
Management research shows that social capital between a company and its various stake-holders confers numerous strategic advantages. It confirms the common sense observation that socially isolated entities can be easily manipulated by opportunistic coalitions using a 'divide and conquer' strategy.1
 
  
 
The advantages of high social capital in stakeholder relationships include:2
  • Better access to financial capital
  • More innovation, greater corporate capacity to learn
  • Lower supply chain costs
  • Lower turnover/recruitment costs
  • Smoother regulatory approvals
  • Advance warning about socio-political risks and opportunities
    
 
1 For a theoretical elaboration of this point see:
     Rowley,T.J. 1997. Moving beyond dyadic ties: A network theory of stakeholder influences. Academy of Management Review, 22(4): 887-910.
2 For reviews of studies demonstrating these benefits, see:
     Svendsen,A.C., Boutilier,R.G., Abbott,R.M., and Wheeler,D. 2001. Measuring the business value of stakeholder relationships: Part One. Toronto: Canadian Institute of Chartered Accountants.
     Svendsen,A.C., Boutilier,R.G., and Wheeler,D. 2003. Stakeholder relationships, social capital and business value creation. Toronto: Canadian Institute of Chartered Accountants.
    
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