Hayleys PLC: corporate responsibility as stakeholder relations

Purpose - This paper aims to answer the following questions: Is corporate responsibility only a cost, or is it also a profitable business strategy? If so, can the strategy work in a B2B context, as well as in the B2C context typically covered by research on corporate responsibility? Finally, how does the geopolitical context of a developing Asian nation affect corporate responsibility, from both a managerial and a stakeholder perspective? Design/methodology/approach - The paper adopts a case study approach, building from observed data to grounded theory. Findings - In a firm where trust and transparency are both ingrained and enforced among managers, Hayleys PLC used those values as tools to transform relations with key stakeholders from costs to marketing assets. In the process, it created an ethical market network in which membership depends on adherence to the same values. Thus emergent ethical marketplaces are directly related to the spread of CR practices. Research limitations/implications - The effects of transparency beyond financial disclosure or sustainability reporting on stakeholder relations would be a particularly valuable object of further research. The structure of ethical markets, and the costs and benefits of participating in them, require and justify further study. Practical implications - An ethical markets strategy can lead to stable long-term relationships with major buyers. However, in the present circumstances, it also entails dependence on a limited number of major customers. Another issue is that, if "the factory becomes a sales tool", it may also kill a sale if and when standards slip or a stakeholder creates conflict. Social implications - A corporate responsibility strategy may transform not only managerial practices, but also the social environment, by enabling or disabling stakeholder partners or adversaries. The means to this objective include providing services and empowerment to stakeholders (in this case, workers) who cannot obtain them from their traditional interlocutors. Originality/value - This paper adds insight into the implications of corporate responsibility for firms involved in B2B markets, as well as for Asian multinationals. It also contributes to answering the question of how corporate responsibility adds value, by demonstrating how corporate responsibility may strengthen key productive and commercial relationships with stakeholders essential to the sustainability of the firm.