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Purpose – This paper aims to explore the power of one of the primary organizational stakeholders (shareholders) in the development of a corporate social performance (CSP) score. Few research works in the CSP empirical literature have studied the relationship between stakeholder power and CSP. Design/methodology/approach – Stakeholder theory is used as a theoretical framework to explain how shareholder voting power can influence the CSP level of French publicly listed companies. Stakeholder theory is tested through the operationalization of Ullmann’s (1985) three-dimensional model. Hypotheses related to shareholder voting power, strategic posture and financial performance are formulated through a literature review. A Data Envelopment Analysis approach was presented as a strong tool to measure CSP level. Multiple linear regressions were undertaken to test the hypotheses in a sample of 129 French companies between 2006 and 2007. Findings – The results indicate that companies with dispersed ownership and high proportion of institutional shareholders record a high score of CSP. Strategic posture measured by the implementation of environmental certification standard was positively and significantly related to CSP. Financial performance does not affect significantly the level of CSP. Originality/value – This paper is the first to empirically analyse the relationship between Ullmann’s three-dimensional model and CSP level in the French context. It offers to managers a better understanding of the power that certain stakeholders can use to acquire satisfaction.
Lahouel et al. (Tue,) studied this question.