Journal
BUSINESS & SOCIETY
Volume 60, Issue 4, Pages 1009-1036Publisher
SAGE PUBLICATIONS INC
DOI: 10.1177/0007650319870818
Keywords
stakeholder engagement; stakeholder influence strategies; tobacco industry; stakeholder relations
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This study examines the stakeholder engagement strategies of two U.S. tobacco manufacturers post-1998, highlighting the importance of managing multiple stakeholders simultaneously for sustained value creation. The different strategies pursued by the companies and their impact on growth prospects show the significance of multiple stakeholder relationships in achieving sustained growth.
This study contributes to understanding stakeholder engagement strategies by examining competitive responses alongside sociopolitical implications after a major exogenous shock-the 1998 Master Settlement Agreement (MSA) between the Big Four U.S. tobacco firms and 46 state attorneys general. We compare the different stakeholder engagement strategies of the two remaining U.S. tobacco manufacturers, Philip Morris (PM) and R. J. Reynolds (RJR), between 1998 and 2017. Implications for stakeholder theory from a relatively rare natural experiment highlight the importance of simultaneously managing multiple stakeholders, inclusive of domestic and international sociopolitical and value chain stakeholders over time, for sustained value creation. Although PM and RJR initially pursued heterogeneous strategies by re-configuring relationships with relevant stakeholders, each firm's growth prospects for the first decade post-MSA were exacerbated by various stakeholders through withholding and selective engagement strategies. Implications for how multiple, simultaneous stakeholder relationships can serve as important resources for achieving or limiting sustained growth are discussed.
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