Paper Title: Relational business model for shared responsibility

Author:        Josef Wieland and Jessica Geraldo Schwengber

Publisher:    International Journal of Ethics and Systems, 41(3), 569 – 589.

This research paper proposes a new framework for corporate and leadership responsibility. The authors’ central argument is that the traditional, often siloed, approaches to corporate social responsibility (CSR) and leadership responsibility are insufficient for addressing the complex, multi-stakeholder challenges of the modern global economy. The paper aims to bridge the gap between these two concepts by introducing a relational business model and an accompanying relational decision-making approach.

The authors begin with a comprehensive literature review, tracing the historical evolution of both corporate responsibility and leadership responsibility from the mid-20th century to the present. This includes a discussion of key academic debates and theories, such as the Berle-Dodd debate, Milton Friedman’s critique, and later concepts like Freeman’s stakeholder theory and Porter and Kramer’s Creating Shared Value (CSV).

The authors argue that these two fields have traditionally been studied separately, with corporate responsibility focused on the meso (corporate) level and leadership responsibility on the micro (individual leader) level. The proposed relational model seeks to overcome this separation by viewing leadership as a relational phenomenon that is not tied solely to individuals but is instead a “social process” involving all stakeholders.

This paper aims to contribute to the literature on corporate and leadership responsibility by proposing a relational business model for shared responsibility. First, a literature review on corporate and leadership responsibility is presented and discussed.

This is followed by an overview of existing public and private regulations and future perspectives that enforce and/or foster corporate and leadership responsibility. Based on the concepts of relational economics, relational leadership and proactive regulation, the theoretical foundations of a relational business model are derived.

In addition, a decision model for the empirical application of the relational business model in ethical dilemma situations is developed and presented. Theoretical elaboration of a relational business model and an associated relational decision making approach. This study contributes to a new way of doing business in terms of shared responsibility.

Furthermore, corporate responsibility and leadership responsibility are usually researched as two distinct fields, with the former referring to the meso level and the latter to the micro level. A relational approach, which views leadership as a relational phenomenon, contributes to bridging both concepts.

The paper’s key finding is the theoretical elaboration of this relational business model. It is based on the idea of a business as a “nexus of stakeholder resources and interests,” which moves beyond a purely transactional, profit-maximizing view. In this model, value is co-created with internal and external stakeholders, and responsibility is shared. This requires a shift from “methodological individualism” to methodological relationism, which considers the dynamic relationship between micro, meso, and macro levels.

Furthermore, the paper develops a six-step relational decision-making model to help organizations navigate ethical dilemmas within these global value networks. This model differentiates itself from existing frameworks by extending the decision-making process beyond institutional boundaries to include the interests and resources of diverse stakeholders.

The study’s originality lies in its attempt to bridge the conceptual divide between corporate and leadership responsibility through a unified relational framework. It proposes a new way of doing business that is inherently focused on shared responsibility, especially within global value chains. The paper’s contribution is particularly timely given the increasing legal and social pressure for corporations to be accountable for their entire value network, as seen in regulations like the EU’s Corporate Sustainability Due Diligence Directive (CSDDD).

However, a critical perspective reveals some limitations. While the paper outlines a theoretical model, the “findings” are a “theoretical elaboration” and not an empirical validation. The paper does not provide a detailed, a priori empirical application of the proposed model, although it mentions its empirical potential and gives a brief example. The authors themselves note that a detailed explanation of the required methodological shift to relationism is “beyond the scope of this article”, which could be a significant barrier to practical application and further research.

The paper acknowledges that the academic debate on CSR has “stagnated in recent years” and a critical reader might ask if this new model, while innovative, can truly revitalize a field that the authors themselves describe as having “no other relevant conceptual innovations” after 2017. The framework’s success in practice would depend heavily on an organization’s willingness and ability to implement a complex, multi-stakeholder approach that challenges the dominant transactional business model.

As highlighted in the literature review section, although corporate and leadership responsibility has evolved over the years in both academic debate, standards and legislation, there is an ongoing debate that not everything that could have been done has been done. The current global environmental, social and economic challenges demand further and increased responsibility from businesses.

This pressure has translated into private and public regulations that extend responsibility to global activities along value networks. Although the challenges are global, the debates, regulations and standards are mainly Western in nature. Effective engagement by other key actors beyond Europe and the USA in proactive regulations would likely increase the effectiveness of action, as the challenges are not concentrated in the USA and Europe but are global in scope.

Although debates, standards and regulations impose greater responsibility on companies, the authors argue that current and future challenges require a new way of doing business. A relational business model is proposed here to deal with the economic, societal, environmental and more general practical implications of such a greater responsibility. This is a business model that conceptualizes firms as a nexus of stakeholders’ resources and interests which extends therefore firms’ boundaries and shared responsibility.

Corporate responsibility assumes also responsible leadership and responsibility is shared by all relevant stakeholders along value networks and sets the context for proactive relational standards. The practical implications of extending shared responsibility to all relevant stakeholders may increase ethical dilemmas, especially in the case of corporations that operate in a global context.

Global operations can be particularly prone to ethical dilemmas because while one may agree on thin ethics (what is right and wrong in an abstract sense), different local contexts and different stakeholders may have a different understanding of what this right and wrong means (thick ethics). This may underline the need to address ethical dilemmas in global value networks. For this purpose, a relational business model is proposed. The model includes the different stakeholders, their interests, motivations and resources as well as an environmental analysis in the decision-making process.

The added value of the model can be linked to the fact that companies today are held accountable not only for their own activities but also for the activities of business partners and numerous stakeholders along global value networks.

Hence, such an extension is more in line with the current empirical social and economic reality in which companies operate. In practical terms, it is a general model that can be applied to different organizations in different contexts and can help to strengthen the responsible orientation of the company and contribute to compliant and responsible corporations and leadership.