Stakeholder Value Creation: Legitimating Business Sustainability

Abstract

The purpose of this chapter is to examine how business sustainability is considered and legitimated in stakeholder value creation studies. Based on a review of stakeholder value creation literature, a stakeholder value creation typology is presented. The typology consists of four categories, which are (1) focal firm orientation with economic value perspective, (2) stakeholder orientation with economic value perspective, (3) focal firm orientation with multiple value perspective, and (4) stakeholder orientation with multiple value perspective. Each category tells a somewhat different story of what the purpose of business is, who are the important stakeholders, what role does sustainability play in business, and how business sustainability is legitimated. A closer analysis reveals that the category of stakeholder orientation with a multiple value perspective shows the most potential to build the legitimacy of business sustainability on the profound meaning of sustainability with economic, social, and environmental dimensions. In this category, business sustainability is legitimized in terms of cooperative stakeholder relationships, continual negotiations, and collective efforts, where versatile value is created for various stakeholders, including values related to sustainability. The recommendations for future research draw attention to versatile and broad understanding of value, stakeholders, and value creation and dynamic, systemic, and multilevel stakeholder relationships and collaboration as subjects to understand the legitimation of business sustainability.