Employee wellbeing and stakeholder ranking

Emotional culture

At Vail Resorts, customer service staff aren’t given scripts. The ski resort company simply tells everyone to “go out there and have fun”. Every year, there’s a Have Fun award that goes to the member of staff responsible for the best initiative promoting fun at work. To keep staff pepped up and smiling, Vail offers off-the-job perks as well, like adventure trips and first access to the ski slopes (it’s called “first tracks”).

For some cultures (think most of Northern Europe), such strategies might sound toe-curling. But the fault is on them. Companies’ emotional culture is, the authors argue, as important for success as its cognitive culture: i.e. the shared values, norms, and assumptions by which an organisation is guided. Employees’ commitment, creativity, decision making, performance and retention rates are all directly linked to how emotionally in tune fellow workers are. The paper cites the example of firefighters, who prize playing pranks with one another. Yet, unexpectedly for a male-dominated profession, “companionate love” also features strongly. So words of encouragement when fellow firefighters are struggling after a tough job, say, or a bear hug for someone who was choked up over a personal issue. Joviality helps teams coordinate better on the job because all the joking makes them aware of one another’s weaknesses, while workplace affection sees them through the trauma of their jobs.

Yet, despite the evidence in its favour, emotional management gets a bad wrap in the office. Managers often see it as invasive, “soft” or unprofessional. Even then, however, emotions still play a role (suppression is an emotion). What’s more, emotions spread. A grumpy boss will all too often give rise to an unhappy, demotivated team. An angry team leader, in contrast, spreads fear. And so on.

So what can be done? Three things at least. First, go with what you’ve already got. Think about “gentle nudges” during the working day: a meditation break, mindfulness apps, a “kudos board” on which you can write nice things about your colleagues. Second, model healthy emotions. If you walk into a room with a smile on your face, others are more likely to start smiling too. Lastly, fake it. If you don’t feel especially kind or loving or charitable at a particular moment in time, just pretend you are. Social psychology shows that by “deep acting”, you can coax yourself into the real thing. Furthermore, social psychology shows that others pick up on a dominant emotion and begin to conform to it too. The emotional ripple effect.

Note, leaders are particularly important when it comes to creating an emotional culture for an organisation. “Large, symbolic emotional gestures are powerful,” the paper concludes. These have to be backed up by every-day behaviours. If not, cynicism reigns.

Barsade, S, and O’Neill, O (Jan-Feb 2016), “Manage Your Emotional Culture”, Harvard Business Review, 58-66.

Stakeholder influence

In 2009, environmental activist group Greenpeace released the film “Slaughtering the Amazon”, highlighting the effect of cattle-raising on deforestation. Shortly afterwards, sports companies Nike and Adidas ordered their suppliers to stop using leather sourced from Brazil’s iconic rainforest. The example is one of hundreds where pressure from an external stakeholder has influenced corporate practices. But which stakeholders are most effective? And what effect does such pressure have on a company’s market performance?

Drawing on the findings of a survey of top managers in a range of Swiss private firms, this paper draws on both resource dependency theory and institutional theory to interrogate these questions. The order of primacy within stakeholder groups is interesting. Topping the list of influencers is employees, followed by consumers and investors. Contrary to assumed logic, government ranks comparatively poorly as a motivating driver for CSR implementation – an argument that plays into the hands of Friedmanites and other neoliberal advocates of voluntary action. “Secondary” stakeholders, of which the media and NGOs are the most notable, exert only moderate pressure. Their success at getting companies to sit up and listen all depends on how much influence they appear to hold with those stakeholders who really count. This is classic stakeholder theory, albeit played out with impressive granular statistical analysis.

The paper’s most important contribution relates to the effect of CSR implementation on market performance. Unequivocally, the findings reject the notion that CSR and shareholder wealth maximisation operate in opposition. The competitive advantage that responsible companies glean derives mainly from intangible resources such as reputational advantage and culture development. The more turbulent the business environment (defined as “market dynamism”), the more important to adopt CSR practices and enhance performance in response to stakeholder pressure, the paper concludes. “This recommendation may hold especially true in economic crises, when churn among employees and customers is high and NGOs and media highlight irresponsible business behaviours.”

A more nuanced analysis of the relationship between stakeholder pressure and CSR implementation would have been welcome. What role do factors such as stakeholder power and legitimacy play, for instance? The paper could benefit from a wider research base too. Does this play out the same in Sweden and South Korea as Switzerland? This marks an important addition to the stakeholder theory literature, all the same.

Helmig, B, Spraul, K, and Ingenhoff, D (Feb 2016), “Under Positive Pressure: How Stakeholder Pressure Affects Corporate Social Responsibility Implementation”, Business & Society 55(2) 151–187.

On Campus

The University of Lugano’s Dr Peter Seele and London Metropolitan University’s Dr Samuel Idowu are among the confirmed speakers at the Academic CSR Summit on 5 April 2016 in Ludwigsburg, Germany. The event, which carries the title “Market Disruptions – Driver for Sustainable Development”, coincides with the German CSR Forum.

Maryland-based Laureate Education, the world’s largest higher education company, has become a certified B Corporation. The B Corp certification recognises entities that meet a range of standards related to social and environmental performance, transparency and accountability.

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