The Cooperation Complexity Rainbow: Challenges of Stakeholder Involvement in Managing Multinational Firms

Abstract

Management of multinational enterprises is a complex and challenging task. This complexity also exists in managing value chains and interactions among interest groups. The objective of this paper is to highlight and present a theoretical framework on challenges that multinational corporations face when integrating their stakeholders in management processes. In a multinational corporation, value-based management and long term value creation require the consideration of all stakeholders in the strategic decision-making process. Involving stakeholders is not only an activity aligned with social responsibility but also necessary for ensuring effective corporate governance. An extensive literature review resulted in the development of a conceptual framework which can be used for addressing these challenges. The essential issues of this framework are presented in four categories: relationships, environmental context, management (including structure and strategy issues) and stakeholder engagement. Future research might involve a large scale survey to enhance the understanding of the issue and empirically test the theoretical framework.