For decades, scholars have debated the corporate objective. Scholars have either advocated a corporate objective focused on generating value for shareholders or creating value for multiple groups of stakeholders. Although it has been established that the corporate objective can shape many aspects of the corporation—including culture, compensation, and decision making—to date, scholars have not yet explored its psychological impact; particularly, how the corporate objective might influence employee well-being. In this article, we explore how two views of the corporate objective affect (...) employee self-determination, a key component of overall psychological need satisfaction and well-being. We hypothesize that a corporate objective based on creating value for multiple stakeholders will increase employee psychological need satisfaction as compared to one focused on creating value for only shareholders. Across four experimental studies and one field survey, we find consistent support for our hypotheses and test three facets of a stakeholder-focused corporate objective. Theoretical implications and future research directions are discussed. (shrink)

Can business humanize its stakeholders? And if so, how does this relate to moral consideration for stakeholders? In this paper we compare two business orientations that are relevant for current business theory and practice: a stakeholder orientation and a profit orientation. We empirically investigate the causal relationships between business orientation, humanization, and moral consideration. We report the results of six experiments, making use of different operationalizations of a stakeholder and profit orientation, different stakeholders, and different participant samples. Our findings support (...) the prediction that individual stakeholders observing a stakeholder-oriented firm see the firm’s other stakeholders as more human than individual stakeholders observing a profit-oriented firm. This humanization, in turn, increases individual stakeholders’ moral consideration for the firm’s other stakeholders. Our findings underscore the importance of humanization for stakeholders’ moral consideration for each other. This paper contributes to a deeper understanding of the firm as a moral community of stakeholders. Specifically, we move away from a focus on managers, and how they can make business more moral. Instead we direct attention to stakeholders, and how business can make these stakeholders more moral. (shrink)

Scant research has examined the effects of an organization’s stakeholder orientation on the cognition and attitudes of employees. Our study focuses on how one aspect of an organization’s objective, its stakeholder orientation, affects employee job satisfaction. Through seven studies utilizing different samples and measures, we theorize and demonstrate that employees with a higher perceived stakeholder orientation experience enhanced job satisfaction. We provide correlational field data and causal experimental evidence to show that increased employee perspective-taking is one potential mediator of this (...) effect. These results contribute to our understanding of job satisfaction and perspective-taking by showing how employee orientation toward other stakeholders affects their attitude toward their job and social cognition. We also expand the focus of stakeholder orientation beyond normative philosophy and toward understanding its effects on the cognitions and attitudes of organizational members to provide a basis for examining the behavioral implications of different stakeholder orientations. (shrink)