For many decades, the dominant paradigm for business students and corporate leaders to think about organizational interactions was the principal-agent theory. This was fit for purpose when preventing fraudulous activities and maximizing profits were the main objectives in relation to organizational interactions.

However, with the sustainability challenges in our current society a different type of thinking about organizational interactions is needed.

Are you an agent or a steward?

We argue that a reasoning based on stewardship theory is needed to find solutions for these sustainability challenges. Research findings show that on an individual level stewardship is enacted in the integrator orientation to responsible leadership. Leaders adopting an integrator perspective aim to create long term value for both the company and for society.

On an organizational level stewardship is visible in the strategic orientation of organizations. If an organization adopts a stewardship strategic orientation, it shows a intrinsic commitment to contribute in a positive way to solving a societal issue. This has consequences on the market level. Organizations with a stewardship strategic orientation are in a better position to find the courage to be the first to act differently for societal issues and, by doing so, trigger institutional change so stewardship becomes embedded in the market structures.

Table 1: Characteristics of an instrumental and stewardship strategic orientation[1]

[1] Chevrollier, N., Zhang, J., Van Leeuwen, T., & Nijhof, A. H. (2020). The predictive value of strategic orientation for ESG performance over time. Corporate Governance, 20(1), 123–142. https://doi.org/10.1108/cg-03-2019-0105

Do you want to know the similarity between a pen and a business model?

In my presentation at the Insights Congress - EMEA, I’ll explore the surprising parallels between a pen and a business model, illustrating how these insights can guide you in becoming a responsible leader. I’ll also share a ‘living case’ featuring Gijs Schuring from Sumthing to bring these concepts to life.

This article gives a sneak preview of the chapter that will be published in the book ‘Radical Thinkers’ that will come available in January 2025 and is written by prof. dr. ir. André Nijhof from the Nyenrode Business University and Mark de Lat, ESG Opinionleader at Eshuis Accountants and Advisors and PhD researcher at Nyenrode and Saxion University of applied Science.