Accounting for Sustainability: Dr. Emilio Marti

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Dr. Emilio Marti from Rotterdam School of Management, Erasmus University will talk about his research (co-written with Tanja Ohlson from University of New South Wales Sydney and Falko Paetzold from University of Zurich)  titled "Relying on other stakeholders to make companies more sustainable: Ethnographic insights from a shareholder engagement fund"

Abstract

To develop a less heroic account of the impact of sustainable investing, in which impact is not single-handedly achieved by powerful shareholders, researchers have started to explore how sustainable shareholders rely on other stakeholders to influence companies. Yet, such reliance has only been explored for public confrontations between shareholders and companies, not for private interactions. We therefore explore whether and, if so, how shareholder dialogue relies on other stakeholders to impact companies. Based on unique ethnographic access to the Federated Hermes SDG Engagement Fund, we show that this Fund capitalized on its privileged access while compensating for its limited direct influence by making other stakeholders salient. When the Fund made many other stakeholders salient around one of its demands, this changed how companies perceived their stakeholder environment and led them to implement demands more quickly. We combine and contrast our inductive insights with prior research on how sustainable shareholders rely on other stakeholders in public confrontations to develop a theoretical model that illuminates the complementarity between public confrontations and private dialogues: while public confrontations foster changes in the stakeholder environment of companies, private dialogues speed up how quickly companies adapt to these changes in their stakeholder environment. Our paper contributes to research on sustainable investing by illuminating how shareholder dialogue can speed up changes within companies, why one should not expect that shareholder dialogue induces radical changes within companies, and why prior research may have overestimated the impact of shareholder dialogue.

Emilio Marti is an associate professor at the Rotterdam School of Management. He is an organizational theorists with a keen interest in questions of corporate sustainability. Emilio is particularly interested in sustainable investing, and the question of how sustainable investing affects corporate sustainability. Emilio joined RSM in 2018 after post-doctoral positions at the Saïd Business School, University of Oxford, and Bayes Business School, City, University of London. He completed his PhD at the University of Zurich in 2015. His work has been published in journals such as the Academy of Management Journal, Academy of Management Review, Journal of Management Studies, and Organization Science.