A Political Mediation Model of Corporate Response to Social Movement Activism

This paper uses a theory of social movement outcomes, the political mediation model, to explain why certain corporations targeted by boycotts are more likely to concede to boycotters' demands. Hypotheses developed from this model predict that boycotts threaten tangible and intangible resources held by corporate targets, that these threats are transmitted indirectly through media coverage of the boycotts, that past declines in sales or reputation create opportunities for a movement to have influence, and that the level of threat posed by a boycott generates more influence when targeted against corporations that recently experienced declines in sales or reputation. Results from analyses of a sample of corporate boycotts reported in major national newspapers in the U.S. between 1990 and 2005 provide support for the political mediation model. Corporate targets of boycotts were more likely to concede when the boycott received a great deal of media attention. The effect of media attention was amplified when the corporate target previously experienced a decline in its reputation.

[1]  P. Koku,et al.  The Financial Impact of Boycotts and Threats of Boycott , 1997 .

[2]  D. Mcadam Tactical Innovation and the Pace of Insurgency , 1983 .

[3]  E. Q. D. Puente,et al.  Empirical Analysis of the Relationship Between Corporate Reputation and Financial Performance: A Survey of the Literature , 2003 .

[4]  Theodore Sasson,et al.  Media Images and the Social Construction of Reality , 1992 .

[5]  Sidney Tarrow,et al.  Comparative Perspectives on Social Movements: States and opportunities: The political structuring of social movements , 1996 .

[6]  F. Rojas Social Movement Tactics, Organizational Change and the Spread of African-American Studies , 2006 .

[7]  Gerald F. Davis,et al.  Social movements and organization theory , 2005 .

[8]  R. Hess Power in organizations. , 2003, Journal of nursing scholarship : an official publication of Sigma Theta Tau International Honor Society of Nursing.

[9]  Ronald K. Mitchell,et al.  Toward a Theory of Stakeholder Identification and Salience: Defining the Principle of who and What Really Counts , 1997 .

[10]  Kimberly D. Elsbach MANAGING ORGANIZATIONAL LEGITIMACY IN THE CALIFORNIA CATTLE INDUSTRY - THE CONSTRUCTION AND EFFECTIVENESS OF VERBAL ACCOUNTS , 1994 .

[11]  J. Griffin Corporate restructurings: ripple effects on corporate philanthropy , 2004 .

[12]  J. Ruiz Moreno [Organizational learning]. , 2001, Revista de enfermeria.

[13]  P. Burstein,et al.  The Impact of Political Parties, Interest Groups, and Social Movement Organizations on Public Policy: Some Recent Evidence and Theoretical Concerns , 2002 .

[14]  G. Dowling,et al.  Corporate reputation and sustained superior financial performance , 2002 .

[15]  Holly J. McCammon,et al.  How Movements Win: Gendered Opportunity Structures and U.S. Women's Suffrage Movements, 1866 to 1919 , 2001, American Sociological Review.

[16]  Andrew J. Hoffman,et al.  INSTITUTIONAL EVOLUTION AND CHANGE: ENVIRONMENTALISM AND THE US CHEMICAL INDUSTRY , 1999 .

[17]  Henrich R. Greve,et al.  Organizational Learning from Performance Feedback: A Behavioral Perspective on Innovation and Change , 2003 .

[18]  D. Mcadam Political Process and the Development of Black Insurgency, 1930-1970 , 1982 .

[19]  Timothy G. Pollock,et al.  Media Legitimation Effects in the Market for Initial Public Offerings , 2003 .

[20]  Brayden G. King,et al.  Signals or Mixed Signals: Why Opportunities for Mobilization are not Opportunities for Policy Reform , 2007 .

[21]  J. Harrison,et al.  STAKEHOLDERS, SOCIAL RESPONSIBILITY, AND PERFORMANCE: EMPIRICAL EVIDENCE AND THEORETICAL PERSPECTIVES , 1999 .

[22]  Marc Schneiberg 2. Organizational heterogeneity and the production of new forms: Politics, social movements and mutual companies in american fire insurance, 1900–1930 , 2002 .

[23]  M. Leiblein,et al.  Do make or buy decisions matter? The influence of organizational governance on technological performance , 2002 .

[24]  Shorey Peterson,et al.  The Modern Corporation and Private Property. , 1933 .

[25]  C. Fombrun,et al.  What's in a Name? Reputation Building and Corporate Strategy , 1990 .

[26]  Rakesh Khurana Searching for a Corporate Savior: The Irrational Quest for Charismatic CEOs , 2002 .

[27]  K. Andrews,et al.  Social Movements and Policy Implementation: The Mississippi Civil Rights Movement and the War on Poverty, 1965 to 1971 , 2001, American Sociological Review.

[28]  Curtis M. Grimm,et al.  The impact of market actions on firm reputation , 2006 .

[29]  Nicole C. Raeburn Changing Corporate America from Inside Out , 2004 .

[30]  Tim Rowley Moving Beyond Dyadic Ties: A Network Theory of Stakeholder Influences , 1997 .

[31]  Luigi Zingales,et al.  The Corporate Governance Role of the Media , 2002 .

[32]  R. Berk An introduction to sample selection bias in sociological data. , 1983 .

[33]  H. Rao The Social Construction of Reputation: Certification Contests, Legitimation, and the Survival of Organizations in the American Automobile Industry: 1895–1912 , 1994 .

[34]  Susan Olzak,et al.  Organizational Diversity, Vitality and Outcomes in the Civil Rights Movement , 2007 .

[35]  J. D. McCarthy,et al.  Protest Events: Cause or Consequence of State Action? The U.S. Women's Movement and Federal Congressional Activities, 1956-1979 , 1999 .

[36]  Robert N. Stern,et al.  The External Control of Organizations: A Resource Dependence Perspective. , 1979 .

[37]  Michael Useem,et al.  Investor Capitalism : How Money Managers Are Changing the Face of Corporate America , 1996 .

[38]  Frederick D. Sturdivant,et al.  Consumer Responses to Socially Questionable Corporate Behavior: An Empirical Test , 1977 .

[39]  David L. Deephouse,et al.  Media Reputation as a Strategic Resource: An Integration of Mass Communication and Resource-Based Theories , 1999 .

[40]  W. Gamson,et al.  Comparative Perspectives on Social Movements: Framing political opportunity , 1996 .

[41]  D. Bromley Reputation, image, and impression management , 1993 .

[42]  Jeff Frooman Stakeholder Influence Strategies , 1999 .

[43]  Fabio Rojas,et al.  From Black Power to Black Studies: How a Radical Social Movement Became an Academic Discipline , 2010 .

[44]  Herbert Kitschelt,et al.  Political Opportunity Structures and Political Protest: Anti-Nuclear Movements in Four Democracies , 1986, British Journal of Political Science.

[45]  Gardiner C. Means,et al.  The Modern Corporation and Private Property. , 1934 .

[46]  Dennis E. Garrett The Effectiveness of Marketing Policy Boycotts: Environmental Opposition to Marketing , 1987 .

[47]  Samuel B. Bacharach,et al.  Research in the Sociology of Organization. , 1994 .

[48]  A. Heene,et al.  Managing the reputation of restructuring corporations: send the right signal to the right stakeholder , 2004 .

[49]  Guido Berens,et al.  Corporate Associations in the Academic Literature: Three Main Streams of Thought in the Reputation Measurement Literature , 2004 .

[50]  Richard C. Fording The Conditional Effect of Violence as a Political Tactic , 1997 .

[51]  M. Friedman,et al.  Consumer Boycotts in the United States, 1970–1980: Contemporary Events in Historical Perspective , 1985 .

[52]  C. Oliver STRATEGIC RESPONSES TO INSTITUTIONAL PROCESSES , 1991 .

[53]  S. Soule,et al.  THE TARGETS OF SOCIAL MOVEMENTS: BEYOND A FOCUS ON THE STATE , 2004 .

[54]  Joseph E. Luders The Economics of Movement Success: Business Responses to Civil Rights Mobilization1 , 2006, American Journal of Sociology.

[55]  J. Patell CORPORATE FORECASTS OF EARNINGS PER SHARE AND STOCK-PRICE BEHAVIOR - EMPIRICAL TESTS , 1976 .

[56]  Andrew John,et al.  The Boycott Puzzle: Consumer Motivations for Purchase Sacrifice , 2003, Manag. Sci..

[57]  L. Preston,et al.  The Stakeholder Theory of the Corporation: Concepts, Evidence, and Implications , 1995 .

[58]  M. Lipsky,et al.  Protest as a Political Resource , 1968, American Political Science Review.

[59]  Maureen A. Scully,et al.  4. Passion with an umbrella: Grassroots activists in the workplace , 2002 .

[60]  Sarah A. Soule,et al.  When Do Movements Matter? The Politics of Contingency and the Equal Rights Amendment , 2004 .

[61]  Debra C. Minkoff,et al.  Conceptualizing Political Opportunity , 2004 .

[62]  J. D. McCarthy,et al.  The use of newspaper data in the study of collective action , 2003 .

[63]  Michael A. Berger,et al.  Social Movements in Organizations: Coup d'Etat, Insurgency, and Mass Movements , 1978, American Journal of Sociology.

[64]  Antoaneta P. Petkova,et al.  Being good or being known: An empirical examination of the dimensions, antecedents, and consequences of organizational reputation , 2005 .

[65]  Simon Zadek,et al.  The Civil Corporation: The New Economy of Corporate Citizenship , 2001 .

[66]  E. Amenta When Movements Matter: The Townsend Plan and the Rise of Social Security , 2006 .

[67]  J. Goodwin,et al.  Caught in a Winding, Snarling Vine: The Structural Bias of Political Process Theory , 1999 .

[68]  Marco Giugni,et al.  Social Protest and Policy Change: Ecology, Antinuclear, and Peace Movements in Comparative Perspective , 2004 .

[69]  D. Smith,et al.  The Shareholder Primacy Norm , 1998 .

[70]  Hayagreeva Rao,et al.  COVERT POLITICAL CONFLICT IN ORGANIZATIONS: Challenges from Below , 2003 .

[71]  Mayer N. Zald,et al.  Power in Organizations. , 1971 .

[72]  Gerald F. Davis,et al.  Introduction: Social Movements in Organizations and Markets , 2008 .

[73]  Robert Jackall,et al.  Moral mazes: The world of corporate managers , 1988 .

[74]  M. Clarkson A Stakeholder Framework for Analyzing and Evaluating Corporate Social Performance , 1995 .

[75]  Robert Jackall,et al.  Moral mazes: The world of corporate managers , 1989 .

[76]  Edwin Amenta,et al.  A Hero for the Aged? The Townsend Movement, the Political Mediation Model, and U.S. Old-Age Policy, 1934-1950 , 1992, American Journal of Sociology.

[77]  S. Key Toward a new theory of the firm: a critique of stakeholder “theory” , 1999 .

[78]  A. Hoffman,et al.  Not All Events are Attended Equally: Toward a Middle-Range Theory of Industry Attention to External Events , 2001 .

[79]  David Vogel,et al.  The Market for Virtue , 2005 .

[80]  Jarol B. Manheim The Death of A Thousand Cuts: Corporate Campaigns and the Attack on the Corporation , 2000 .

[81]  David L. Deephouse,et al.  An Examination of Differences between Organizational Legitimacy and Organizational Reputation , 2005 .

[82]  Edwin Amenta,et al.  Age for Leisure? Political Mediation and the Impact of the Pension Movement on U.S. Old-Age Policy , 2005 .

[83]  C. Oliver SUSTAINABLE COMPETITIVE ADVANTAGE: COMBINING INSTITUTIONAL AND RESOURCE- BASED VIEWS , 1997 .

[84]  Charles Perrow,et al.  Insurgency of the Powerless: Farm Worker Movements (1946-1972). , 1977 .

[85]  E. Amenta,et al.  Stolen Thunder? Huey Long's "Share Our Wealth," Political Mediation, and the Second New Deal , 1994 .

[86]  Clarke A. Chambers,et al.  Poor People's Movements: Why They Succeed, How they Fail , 1978 .

[87]  Roderick M. Kramer,et al.  Members' Responses to Organizational Identity Threats: Encountering and Countering the Business Week Rankings , 1996 .

[88]  N. Fligstein,et al.  The Architecture of Markets , 2015 .

[89]  William A. Gamson,et al.  The strategy of social protest , 1975 .

[90]  Rachel Schurman,et al.  Fighting “Frankenfoods”: Industry Opportunity Structures and the Efficacy of the Anti-Biotech Movement in Western Europe , 2004 .

[91]  D. S. Meyer Social Protest and Policy Change: Ecology, Antinuclear, and Peace Movements in Comparative Perspective , 2005, Perspectives on Politics.

[92]  Brayden G. King,et al.  Social Movements as Extra-Institutional Entrepreneurs: The Effect of Protests on Stock Price Returns , 2007 .

[93]  J. McGuire,et al.  Corporate Social Responsibility and Firm Financial Performance , 1988 .

[94]  Alison Mackey,et al.  A Social Actor Conception of Organizational Identity and Its Implications for the Study of Organizational Reputation , 2002 .

[95]  Brayden G. King,et al.  The Stages of the Policy Process and the Equal Rights Amendment, 1972–19821 , 2006, American Journal of Sociology.

[96]  C. Ross,et al.  Protest Group Success: The Impact of Group Characteristics, Social Control, and Context , 1981 .

[97]  Michael Lounsbury,et al.  Institutional Sources of Practice Variation: Staffing College and University Recycling Programs , 2001 .

[98]  Martin Gargiulo Two-step leverage: Managing constraint in organizational politics , 1993 .

[99]  T. Jones INSTRUMENTAL STAKEHOLDER THEORY: A SYNTHESIS OF ETHICS AND ECONOMICS , 1995 .

[100]  Stephen W. Pruitt,et al.  The impact of union-sponsored boycotts on the stock prices of target firms , 1988 .

[101]  Jerold B. Warner,et al.  Using daily stock returns: The case of event studies , 1985 .

[102]  C. Coulton,et al.  Interaction Effects in Multiple Regression , 1993 .

[103]  Marco Giugni,et al.  How social movements matter: past research, present problems, future developments , 1999 .

[104]  Charles J. Fombrun,et al.  Reputation: Realizing Value from the Corporate Image , 1996 .

[105]  J. D. McCarthy,et al.  Comparative Perspectives on Social Movements , 1997 .

[106]  A. F. Conard Beyond Managerialism: Investor Capitalism? , 1988 .

[107]  M. T. Kennedy,et al.  Getting Counted: Markets, Media, and Reality , 2008 .

[108]  Sherry J. Holladay,et al.  Unpacking the halo effect: reputation and crisis management , 2006 .

[109]  Yang Su,et al.  The War at Home : Antiwar Protests and Congressional Voting , 1965 to 1973 Author ( s ) : , 2007 .

[110]  Wallace N. Davidson,et al.  Influencing Managers to Change Unpopular Corporate Behavior through Boycotts and Divestitures , 1995 .

[111]  R. Bromley The Death of a Thousand Cuts: Corporate Campaigns and the Attack on the Corporation , 2002 .

[112]  Charles J. Fombrun,et al.  Constructing competitive advantage: The role of firm-constituent interactions , 1999 .

[113]  Barry M. Staw,et al.  What Bandwagons Bring: Effects of Popular Management Techniques on Corporate Performance, Reputation, and CEO Pay , 2000 .

[114]  Leonard S. Rubinowitz,et al.  Social Movements and Social-Change Litigation: Synergy in the Montgomery Bus Protest , 2005, Law & Social Inquiry.

[115]  J. Heckman Sample selection bias as a specification error , 1979 .

[116]  D. Strang,et al.  Social Movements and Organization Theory: ORGANIZATIONAL CHANGE AS AN ORCHESTRATED SOCIAL MOVEMENT: RECRUITMENT TO A CORPORATE QUALITY INITIATIVE , 2005 .

[117]  M. Friedman,et al.  Consumer Boycotts: Effecting Change Through the Marketplace and Media , 1999 .

[118]  Charles Tilly,et al.  How Social Movements Matter , 1999 .

[119]  J. Barney Firm Resources and Sustained Competitive Advantage , 1991 .

[120]  Stephen W. Pruitt,et al.  Determining the effectiveness of consumer boycotts: A stock price analysis of their impact on corporate targets , 1986 .

[121]  D. Snow,et al.  The Outcomes of Homeless Mobilization: The Influence of Organization, Disruption, Political Mediation, and Framing , 2000, American Journal of Sociology.

[122]  Mark C. Suchman Managing Legitimacy: Strategic and Institutional Approaches , 1995 .

[123]  Paul M. Hirsch,et al.  Social Movements, Field Frames, and Industry Emergence: A Cultural-Political Perspective , 2003 .

[124]  M. Friedman,et al.  Capitalism and Freedom , 1963 .

[125]  S. Soule,et al.  Protest and Policymaking: Explaining Fluctuation in Congressional Attention to Rights Issues, 1960-1986 , 2007 .

[126]  C. Morrill,et al.  Social Movements and Organization Theory: THE IMPACT OF SOCIAL MOVEMENTS ON ORGANIZATIONS: ENVIRONMENT AND RESPONSES , 2005 .

[127]  Gregory R. Berry Organizing Against Multinational Corporate Power In Cancer Alley , 2003 .

[128]  J. Papastavrou,et al.  Accounting for Endogeneity When Assessing Strategy Performance: Does Entry Mode Choice Affect Fdi Survival , 1998 .

[129]  John Cowley,et al.  Poor People's Movements: Why They Succeed, How They Fail , 1978 .

[130]  J. D. McCarthy,et al.  Protest under Fire? Explaining the Policing of Protest , 2003, American Sociological Review.