Cross‐Sector Partnerships: An Examination of Success Factors

• Date: 01 March 2018
• Author: Kanwalroop Kathy Dhanda,Laura Pincus Hartman
• Published date: 01 March 2018
• DOI: http://doi.org/10.1111/basr.12139

Cross-Sector Partnerships: An

Examination of Success

Factors

LAURA PINCUS HARTMAN AND KANWALROOP KATHY DHANDA

ABSTRACT

In this paper, we examine the drivers involved in an alter-

native business model: cross-sector social partnerships

(CSSPs) between for-profit, predominantly multinational

corporations (MNCs) and nonprofit organizations (NPOs).

We explore these cross-sector social partnerships (CSSPs)

from the perspective of these primary stakeholders, exam-

ining the questions of power differentials and the defini-

tions and determinants of success. In order more deeply

to understand these drivers, we review the evolution of

the concept of “value” and the perception of the value that

each stakeholder brings to the partnership. We then

describe and offer the results of an empirical, qualitative

study of 18 CSSPs, where we analyze each partner’s rep-

resentations of success, outcomes sought and distinc-

tions in determinants of value within the partnerships.

At time of submission, Laura Pincus Hartman was Director, Susilo Institute for Ethics in the

Global Economy, Boston University, Questrom School of Business. Hartman currently is

Executive Director, The School of Choice, Mirebalais, Haiti. E-mail: LHartman@depaul.edu.

Kanwalroop Kathy Dhanda is Professor of Management, Sacred Heart University, Fairfield, CT,

USA. E-mail: dhandak@sacredheart.edu.

V

C2018 W. Michael Hoffman Center for Business Ethics at Bentley University. Published by

Wiley Periodicals, Inc., 350 Main Street, Malden, MA 02148, USA, and 9600 Garsington

Road, Oxford OX4 2DQ, UK.

Business and Society Review 123:1 181–214

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INTRODUCTION

Over the past quarter century, remarkable changes have

taken place within and across the for-profit and nonprofit

organization (NPO) sectors

1

that have demonstrated a vast

capacity for impact on social issues, often from a position of vested

interest. Privatization and deregulation policies, the globalization of

supply chains, and advances in information and production tech-

nologies have accelerated flows of capital and trade across increas-

ingly porous national borders, resulting in the intensification of the

global impact of institutional practices on a broad and diverse

array of stakeholders. These economic globalization processes have

outpaced global governance arrangements, exposing nations to the

potential volatility and uncertainty of global markets at an unprec-

edented level, disproportionately impacting vulnerable economies

in developing countries, and therefore those individuals at the base

of the economic pyramid (United Nations Conference on Trade and

Development 2012). As an outgrowth of these trends, the same

period has seen a dramatic proliferation of NPOs seeking to

address socioeconomic barriers or challenges that increasingly

exceed the boundaries, resources and, in some instances, political

will of nation states. Between 1990 and 2000, the number of inter-

national NPOs grew by approximately 450% (Dahan et al. 2010);

and, in 2012, more than 1.5 million NPOs were in operation in the

United States, alone (U.S. Department of State 2012). As global

trends have encouraged growth in the scope of activity and the

impact of both the for-profit and nonprofit sectors, cross-sector

relationships have undergone an evolution, as well.

In this article, we examine the drivers involved in an alternative

and relatively creative business model: cross-sector social partner-

ships (CSSPs) between for-profit, predominantly multinational cor-

porations (MNCs) and NPOs. We explore these CSSPs from the

perspectives of both of these primary stakeholders, examining the

questions of power differentials and the definitions and determi-

nants of success. In order more deeply to understand these drivers,

we review the evolution of the concept of “value” and the perception

of the value that each stakeholder brings to the partnership. We

then describe and offer the results of an empirical study of 18

CSSPs,

2

where we analyzed each partner’s representations of

182 BUSINESS AND SOCIETY REVIEW

success, outcomes sought, and distinctions in determinants of

value within the partnerships.

On the basis of this examination, we suggest that there is a per-

suasive business case to be made on behalf of MNC engagement in

partnerships with NPOs in order to fulfill their corporation mis-

sions as well as basic social needs in many arenas of significant

impact, such as education, sustainability, humanitarian relief, and

others. However, we learned that the foundations of that collabora-

tion—how it is forged and implemented—are highly germane to its

ultimate capacity to create value. The more that MNCs are able to

recognize the NPO capacity for and perspective on value, and the

more that NPOs are able similarly to be aware of and benefit from

the MNC focus on strategic implementation and oftentimes a prag-

matic, utilitarian balancing of interests, the more that the partner-

ship will be able to flourish and succeed. What is most important

in establishing a CSSP that is perceived as bringing value to all

partners is a recalibration of mental models such that the viability

of co-creating value is affirmed by those partners.

PARTNERSHIPS IN CONTEXT: EXISTING MENTAL

MODELS

While much has been written on corporate social responsibility

(CSR) over the last several decades, scholars have convened on the

Davis and Blomstrom (1975) definition of the term, later extended

by Carroll: “The social responsibility of business encompasses the

economic, legal, ethical, and discretionary expectations that society

has of organizations at a given point in time” (Carroll 1979, p. 500;

see also Carroll 1991, 1999; Waddock 2004). The original CSR

umbrella thus covers not merely compliance and ethics but also

volunteerism and philanthropy (see, e.g., May et al. 2007).

During the 1990s, the tension between NPOs and MNCs increased

to what some considered confrontational, with NPOs seeking to

impact corporate behavior through negative pressure focusing on

expanding corporate responsibilities, and companies responding with

CSR initiatives aimed at restoring or improving their public reputa-

tions (focusing on their social/community building efforts) (Doh

2008). During this period, most NPO attention was oriented toward

corporations who were perceived by the public or the media as

183HARTMAN AND DHANDA