Organizational capabilities and value creation for stakeholders: evidence from publicly traded companies

Abstract

Purpose

This paper investigates specific organizational capabilities related to stakeholder relationship capability and the effect of the latter on value creation.

Design/methodology/approach

The authors propose and test whether organizational capabilities related to knowledge, engagement, moral and adaptation are positively related to stakeholder relationship capability. The authors then test the effect of stakeholder relationship capability on the creation of greater value for stakeholders. The study tests the hypotheses with paneled data composed of a sample of 116 publicly traded companies in Brazil for a total of 275 observations taken over three years.

Findings

The findings show that there is a positive and significant relationship between knowledge, engagement, moral and adaptation capabilities and stakeholder relationship capability. Stakeholder relationship capability has been shown to have a positive and significant effect on greater value creation for stakeholders.

Practical implications

Analysis of the processes and practices that serve as the basis for each capability is meaningful for managerial practices, as it offers a more detailed understanding of the routines pertaining to each capability. Practical discussions on operational procedure levels are a meaningful and attainable way for managers to apply stakeholder theory.

Originality/value

The investigation of the specific capabilities enabling value creation between the company and its stakeholders contributes to the discussion of the connections between stakeholder theory and the resource-based view (RBV).

Citation

Barakat, S.R., Boaventura, J.M.G. and Gabriel, M.L.D.S. (2022), "Organizational capabilities and value creation for stakeholders: evidence from publicly traded companies", Management Decision, Vol. 60 No. 8, pp. 2311-2330. https://doi.org/10.1108/MD-05-2021-0576