Business & Society

This review shows how the relationship between nongovernmental organizations (NGOs) and businesses has been examined in business and society, management, and international business (IB) literatures. Altogether 88 relevant studies have been identified through the analysis of article abstracts from 11 leading journals in these fields. The articles have been classified into three categories according to their focus: NGO—business interface, NGO—business— government interface, and NGOs as one of many corporate stakeholders. Six main themes are identified: (a) Activism and NGO influence, (b) dyadic partnership (NGO—business), (c) cross-sector partnership (NGO—business— government), (d) global governance and standardization, (e) national-level governance, and (f) stakeholder management. The state of the research topic is assessed, and implications and avenues for further research are provided.

The article assesses the achievements and limitations of the private regulation of global corporate conduct. Private regulation occurs through voluntary, private, nonstate industry and cross-industry codes that address labor practices, environmental performance, and human rights policies. The author argues that while private regulation has resulted in some substantive improvements in corporate behavior, it cannot be regarded as a substitute for the more effective exercise of state authority at both the national and international levels. Ultimately, private regulation must be integrated with and reinforced by more effective state-based and enforced regulatory policies at both the national and international levels.

The Global Reporting Initiative (GRI) has successfully become institutionalized as the preeminent global framework for voluntary corporate environmental and social reporting. Its success can be attributed to the “institutional entrepreneurs” who analyzed the reporting field and deployed discursive, material, and organizational strategies to change it. GRI has, however, fallen short of the aspirations of its founders to use disclosure to empower nongovernmental organizations (NGOs). The authors argue that its trajectory reflects the power relations between members of the field, their strategic choices and compromises, their ability to mobilize alliances and resources, and constraints imposed by the broader institutions of financial and capital markets. The authors draw three notable implications from this study. First, institutional theory needs to pay more attention to economic structures, strategies, and resources. Second, institutional entrepreneurship by relatively weak societal groups such as NGOs is inherently constrained by the structural power of wider institutions and by the compromises required to initiate change. Third, the strategies of NGOs represent a form of power capable of shifting, if not transforming, the field of corporate governance.

The present study complements current firm—nongovernment organization (NGO) literature by emphasizing the influence of managerial cognition on organizational behavior. In particular, I find that NGOs confront or seek to collaborate with other NGOs or with firms to appear as legitimate actors before selected third parties and as a way to access various sources of funds. By contrast, firm managers interacting with these NGOs are fundamentally concerned with achieving social stability so that their organizations can operate undisturbed. These different goals give rise to considerably dissimilar mental representations of the same reality—representations that subsequently inform strategic action by both types of actors.

This study explores the relational processes that underpin social innovation within strategic cross-sector partnerships. Using four longitudinal narratives to document the duality of success and failure in strategic collaborations between nonprofit and for-profit organizations, the authors explain how partners navigate this duality: deliberate role (re)calibrations help the partners sustain the momentum for success and overcome temporary failure or crossover from failure to success. Our grounded framework models three relational factors that moderate the relationship between role recalibrations and the momentum for success or failure: relational attachment, a personalized reciprocal bond between partners, which provides a stabilizing buffer in the face of unexpected contingencies; partner complacency, an insufficient investment that signals temporary misalignments; and partner disillusionment, an erosion of confidence in the other partner’s commitment that diagnoses premature failure.

This review essay reflects on relationships between the NGO activism and advocacy movement and corporations. The essay does so through a review of Yaziji and Doh’s 2009 book NGOs and Corporations: Conflict and Collaboration. The review essay considers the strengths and weaknesses of the book in relationship to our understanding of NGOs. The essay emphasizes that both NGO and corporate perspectives are important in assessing NGO—corporation relationships.