José Luis Retolaza

Ontological Stakeholder View: An Innovative Proposition

This article describes a theoretical way of understanding business enterprise, for what it is used the stakeholder theory as a theory of the firm. Thus, the purpose of this article is to show an innovative perspective called ontological perspective of stakeholders that relies on a phenomenological model where the subjective perspective of agents is the key, from a purely monetarist model to an economic, social and emotional value creation model, and from a deductive model of stakeholder interests to an inductive model. The main contributions are: add a new perspective to the different classifications made of stakeholder theory, avoid monetarist reductionism under the concept of value in a way that the manager takes into account all interconnected interests of stakeholders, and finally prioritize interests map instead of roles map without accepting the assumption that the role involves joint and no conflicting interests.

Ethical Banks: An Alternative in the Financial Crisis

This paper studies the differences between traditional financial intermediaries (commercial banks, saving banks and credit cooperatives) and ethical banks that focus on positive social and ethical values. The credit crisis calls into question the functionality and good performance of traditional banks. The full incorporation of ethical values and principles by traditional financial intermediaries might be a form to solve their misleading financial situation. We have analyzed four factors that theoretically mean ethical differences: information transparency, placement of assets, guarantees and participation. These four factors are grouped in an index called Radical Affinity Index (RAI). The paper is focused on the study of RAI using a sample of 120 European banks. The evidence shows, that transparency of information and placement of assets are factors that differentiate ethical banks and the rest of financial intermediaries. The guarantees and participation, which seemed to be useful factors to differentiate ethical aspects of banks, do not support clear evidence to the analysis. In sum, RAI is a functional and useful index to show the ethical policy of financial intermediaries.

Legitimizing and Delegitimizing Factors of Firms in Society: Is It a Problem of Communication or Strategic? An Approach Based on the Distributed Social Value as the Key Factor for the Organizations’ Social Legitimacy

There is an increasing concern about the value contributed by firms to the society as a whole. Transnational companies are particularly being questioned; therefore, legitimation for this kind of corporations is demanded. This chapter analyses four delegitimizing factors: negative added value, negative equity, tax evasion and moral hazard associated to potential situations of bankruptcy. Three legitimizing factors will also be analysed: added value distributed to stakeholders, value distributed by “non-market” mechanisms and emotional value generated to different stakeholders of the entity. Since the lack of legitimation affects large companies to a greater degree, two hypotheses related to the size of the firms have been tested. The first has to do with a larger presence of delegitimizing factors in large firms. The second analyses a smaller distribution in this sort of firms of value generated to stakeholders that are not shareholders assessed by means of the social efficiency ratio (SER). The obtained results allow for identifying whether the criticism towards large firms is supported by objective factors (confirmed hypothesis) or subjective ones (rejected hypothesis) and consequently whether the transnational companies should base their action plans of social legitimation on strategy or on communication.

Crowdlending as a Socially Innovative Corporate Financial Instrument

Purpose Crowdfunding is an emergent practice that is increasing exponentially as a means of financing to complement company capital. This chapter focuses on an innovative way of organizing peer-to-peer lending, known as crowdlending. The characteristics of crowdlending are social reward or interest and using the Internet as a medium for communication, prospection and raising funds. To fill the gap in the literature in this regard, this chapter addresses the following questions: Can crowdfunding be considered as a feasible conventional financial tool? What makes crowdlending work? Is it possible to apply the mutual cash holding (MCH) model to crowdlending as well as to previous examples such as the Mondragon Corporation and Trocobuy? Methodology/approach We use three cases (Mondragon Corporation, Trocobuy and Arboribus) to highlight financial tools that use the concept of stakeholder theory that is based on the collaborative management of cash surpluses. Using the Delphi technique combined with in-depth interviews we demonstrate the contribution of the MCH model to crowdlending. We show that the model could be applied to different organizations, thereby indicating its robustness and implying that it could be used in many other cases. Findings The present study suggests that crowdlending describes a new financing tool as a principal form of lending; it enables companies to implement a financial tool that allows for social development and stakeholder participation and that can ensure companies’ financial sustainability. Practical implications This model is based on six elements: expectations of mutual benefits, trust, management, guarantees, mutual profit and benefit. It suggests mutual benefit and positive social values for all stakeholders. However, cash surpluses will be efficiently used only when crowdlending is relevant to investors’ economic objective, because crowdlending as a social innovation does not in itself guarantee economic benefit. Originality/value The chapter provides evidence of crowdlending in practice. The research compares key cases in which the MCH model is applied. It also provides important insights into crowdlending as a social innovation.

Empirical Evidence of Spanish Banking Efficiency: The Stakeholder Theory Perspective

Over recent years the structure of Spanish banking has been changing rapidly and a primary motivation, at least theoretically, has been the search for greater efficiency. This study aims to contribute to the established literature by using the frontier methodology to estimate and compare the economic, social and overall efficiency for the population of Spanish savings banks and banks in 2005 and 2009. The perspective used is based on the Stakeholder Theory because of the differentiation in terms of stakeholder participation between savings banks and banks. The results obtained indicate significant differentiation between these two groups of financial institutions in relation to social and economic efficiency, even though Spanish savings banks are not less efficient globally than banks.