Wagerup pasture in front of refinery
Management research shows that social capital between a company and its various stake-holders confers numerous strategic advantages. It confirms the common sense observation that socially isolated entities can be easily manipulated by opportunistic coalitions using a ‘divide and conquer’ strategy.¹

The advantages of high social capital in stakeholder relationships include:²
Better access to financial capital
More innovation, greater corporate capacity to learn
Lower supply chain costs
Lower turnover/recruitment costs
Smoother regulatory approvals
Advance warning about socio-political risks and opportunities


1 For a theoretical elaboration of this point see:
Rowley,T.J. 1997. Moving beyond dyadic ties: A network theory of stakeholder influences. Academy of Management Review, 22(4): 887-910.
2 For reviews of studies demonstrating these benefits, see:
Svendsen,A.C., Boutilier,R.G., Abbott,R.M., and Wheeler,D. 2001. Measuring the business value of stakeholder relationships: Part One. Toronto: Canadian Institute of Chartered Accountants.
Svendsen,A.C., Boutilier,R.G., and Wheeler,D. 2003. Stakeholder relationships, social capital and business value creation. Toronto: Canadian Institute of Chartered Accountants.

Contact us

We're not around right now. But you can send us an email and we'll get back to you, asap.

Questions, issues or concerns? I'd love to help you!

Click ENTER to chat