Community Influence Capacity on Firms: Lessons from the Peruvian Highlands

Abstract

While much research has studied corporate management of stakeholders, this research focuses on the capacity of stakeholders to influence firms. Using a grounded theory research design, we draw on a comparative analysis of the relations between two neighbouring communities in the Peruvian highlands and the mining project that affects them. Our analysis suggests that control of resources and structural configurations are insufficient for explaining divergent actions and influence capacity, and highlights the role played by factors that we refer to as community vigour and the community’s pool of knowledge. We argue that these factors explain a community’s ability to develop an informed and shared interpretation of the situation in relation to firms and, therefore, to identify and carry out actions that will be more likely to influence firms to the community’s satisfaction. Thus, community vigour and pool of knowledge are additional sources of influence capacity. These findings contribute to the literature on stakeholder influence by providing a conceptual model that explains variance in stakeholder influence capacity that theories of resource dependence, structural position or network centrality do not fully explain.