Stakeholder Management in Small and Medium-Sized Enterprises

Master's Thesis from the year 2009 in the subject Business economics - Business Management, Corporate Governance, grade: 17/20 (1,3), Solvay Brussels School of Economics and Management, course: International Master in Management Science, language: English, abstract: This study derives a model of stakeholder management in small and medium-sized enterprises which describes the process from the owner-managers' personal ethics to the firm's eventual engagement with its stakeholders. Following a thorough review of literature published on stakeholder theory, ethical behaviour in organizations, and small and medium-sized companies, five hypotheses are put forward on which the model is based. The results of three case studies on owner-managed micro-enterprises from the Belgian beer producing industry are used to test the validity of the model and the hypotheses.The results of the case studies on Belgian micro-breweries support the major part of the proposed SME stakeholder management model and the hypotheses it is based on. The perception of legitimate stakeholders is based on the personal ethics of the owner-manager. These are determined by the owner-manager's preference for a certain normative core and his stage of cognitive moral development. Perceived stakeholders will possess power over the company and/or have a legitimate moral or legal claim on the firm. Individual and situational moderators exist which can influence the transition from the owner-manager's personal ethic to his perception of important stakeholders. Relevant individual factors are the owner-manager's type and length of education and employment, family background, culture and nationality, as well as his locus of control. Situational influences found to be important are the views of relevant peers, (psychological) sanctions and rewards, moral intensity, and moral framing. The company's actual stakeholder management depends on whom the owner-manager perceives to be legitimate stakeholders. It may be