Delinking Legitimacies: A Pluriversal Perspective on Political CSR

• Published date: 01 May 2016
• DOI: http://doi.org/10.1111/joms.12173
• Author: Maria Ehrnström‐Fuentes
• Date: 01 May 2016

Delinking Legitimacies: A Pluriversal Perspective on

Political CSR

Maria Ehrnstr€om-Fuentes

Hanken School of Economics

ABSTRACT This study critically examines the concept of political CSR, or legitimacy creation

through deliberation, as something that can be universally agreed upon in places where

incommensurable differences exist. Through a comparative case study of two local stakeholder

groups – one urban and one rural – involved in a conflict over a pulp mill in the south of

Chile, this paper asks: 1) why did the two groups choose different participation strategies in

the deliberation over the desirability of the mill? Based on multiple data sources, the study

finds differences in how each community made sense of the world through place-bound social

imaginaries, which affected the stakeholders’ willingness to participate in deliberation. The

findings suggest that legitimacy cannot be universally secured through dialogues that seek

consensus at the expense of occluded imaginaries, rather it exists as a pluriversal construct. If

political CSR is to play a role in legitimacy creation across imaginaries, the focus should be

on constructing economic alternatives embedded in place that supports the co-existence of

different forms of life.

Keywords: decolonial, deliberation, incommensurable differences, legitimacy, pluriverse,

political CSR, social imaginaries

INTRODUCTION

Recent debates on how corporations should act in an increasingly globalised world have

suggested that greater communication between corporations and their stakeholders

should be promoted. This has come about as a response to the growing sense of distrust

that corporations have faced from the public at large. In this context, Palazzo and

Scherer (2006) suggest a shift in the focus of how corporations gain and maintain their

legitimacy, from a purely self-interested and pragmatic legitimacy towards a more

morally informed legitimacy. In the wake of globalisation, this shift is seen as particularly

Address for reprints: Maria Ehrnstr€om-Fuentes, Hanken School of Economics, Supply Chain Management

and Social Responsibility, Arkadiankatu 22, P.O. Box 479, 00101 Helsinki, Finland (maria.ehrnstrom@

hanken.fi).

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C2015 John Wiley & Sons Ltd and Society for the Advancement of Management Studies

Journal of Management Studies 53:3 May 2016

doi: 10.1111/joms.12173

necessary as nation states are losing their ability to regulate business activities, and the

emergence of heterogeneous values and lifestyles has undermined the taken-for-granted

socially acceptable rules and norms that were once the guiding principles of legitimate

corporate conduct (Scherer and Palazzo, 2011; Scherer et al., 2009).

Legitimacy is often referred to as the necessary ‘social license to operate’ that a firm

requires from society, or more precisely from its stakeholders, in order to enter and

remain in business and, ultimately, to survive as a company. Inspired by Habermas’

(2005 [1996]) theory of communicative action, Palazzo and Scherer (2006), recommend

deliberation as a way of arriving at a mutual understanding with the broader civil soci-

ety on how corporations should act. This shift from a purely strategic, profit-maximising

focus, where corporate action is driven by the goal of increasing shareholder value, to

one where corporations and civil society organisations work together to regulate the

market through democratic principles, is what they have promoted under the concept of

‘political CSR’ (Palazzo and Scherer, 2006; Scherer and Palazzo, 2007, 2011; Scherer

et al., 2009). As they summarise: ‘[P]olitical CSR suggests an extended model of gover-

nance with business firms contributing to global regulation and providing public

goods...where private actors such as corporations and civil society organizations play

an active role in the democratic regulation and control of market transactions’ (Scherer

and Palazzo, 2011, p. 901).

Most of the research taking Sche rer and Palazzo’s framework of political CSR as its

starting point has looked at the relationships be tween companies and influe ntial stake-

holder groups such as large interna tional NGOs or powerful civil societ y groups that

manage to impact the corporate agenda through successful negotiation (Baur and Pal-

azzo, 2011; Baur and Schmit z, 2011; Mena and Palazzo, 2012 ). However, little atten-

tion has been paid to marginalised or even excluded stakeholders th at lack the power

to make their voices heard, and have views that are incommensurabl e with the solu-

tions proposed by large mult inational corporations (e.g., rural communities that se e

their livelihoods threatened or even destroyed by the arrival of multinational firms in

need of land and resources for t heir business activities) (E dward and Willmott, 2008,

p. 420).

Although Scherer and Palazzo acknowledge the challenge of reaching a common

solution – in the form of consensus – in what they describe as ‘value-based conflicts’

(Palazzo and Scherer, 2006, p. 83), their proposal does not clarify how legitimacy is

formed and sustained through deliberation in situations where the interests of the corpo-

ration and its stakeholders are incommensurable. Paradoxically, they note that in cases

where different values are disputed, communication might even ‘fuel the conflict’

(Palazzo and Scherer, 2006, p. 83), and that ‘this process sometimes provokes funda-

mentalist and nationalist backlashes that even further challenges the existing democratic

order’ (Scherer and Palazzo, 2011, pp. 902–3).

When incommensurable differences exist regarding the use of land between corporate

entities and local community stakeholders, what is one party’s gain is the other’s loss;

there is no consensus that can be reached, no win-win situations to be found. For the

companies, their own survival may depend on how their activities are perceived by its

local and global stakeholders, since this can determine both their access to land and

resources as well as to financing and markets (Owen and Kemp, 2013). For those whose

434 M. Ehrnstr€om-Fuentes

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C2015 John Wiley & Sons Ltd and Society for the Advancement of Management Studies