This paper aims to describe the emerging practice of joint management‐stakeholder‐committees (JMSCs) in which corporate executives take decisions in collaboration with stakeholders.
To identify firms involving stakeholders in their governance arrangements, the authors analysed 51 companies regularly participating in Business in the Community's Corporate Responsibility Index in the UK. The data provided by the index as well as corporate reports were then analysed to evaluate the impact of JMSCs on corporate decision‐making.
The research finds that JMSCs strongly influence corporate governance mechanisms such as monitoring and measurement as well as the policy development of firms.
The analysis builds on corporate responses given to the questionnaire sent by the Corporate Responsibility Index as well as corporate reports. Future research is encouraged to triangulate findings with stakeholder opinions on the effectiveness of JMSCs.
JMSCs prove to be an effective tool to involve stakeholders in corporate decision‐making processes. Owing to their effectiveness JMSCs are more likely to create trust between firms and their stakeholders.
The paper is the first empirical investigation into the effectiveness of engaging stakeholders in joint management‐stakeholder committees, demonstrating the impact and effectiveness of such engagement.
