The Impact of Stakeholder Behavior on Decision Making and Sustainability

Abstract

The focus of this study is on stakeholder behavior and organizational culture as they relate to stakeholder behavior and how they affect the performance of sustainable firms run in accordance with corporate social responsibility (CSR) standards. The study shows that different stakeholders' sustainability initiatives have different impacts on how well businesses operate.

This study evaluates two models that are integrated:

• The Stakeholder Orientation Model calculates the connections between organizational culture elements and their effects on stakeholder-oriented organizational behavior.


• The performance model estimates the relationship between stakeholder-oriented organizational behavior and financial and market performance, reputation, and commitment. This is to say that it estimates the influence of values on norms and artifacts, as well as their effects on stakeholder-oriented organizational behavior.

Both models were calculated using structural equation modeling and primary data gathered from big and medium-sized multi-sector Iraqi businesses engaged in sustainable business practices. The results show that values precede norms but neither values nor norms can be used to forecast the appearance of artifacts. Additionally, norms and artifacts have a direct impact on organizational behavior that is focused on stakeholders. In turn, market success and commitment are both predicted by organizational actions that prioritize stakeholders. Nevertheless, financial performance and reputation are not directly correlated with organizational behaviors that prioritize stakeholders.