Organization Management Journal


A key contribution of stakeholder research is that a firm’s purpose and objective is influenced by those stakeholders who have a legitimate stake in a firm’s business activities. Yet, identifying those that have a legitimate stake remains a challenge in stakeholder research. This research draws on legitimacy arguments to explain how stakeholders develop accountability and reliability in their legal and moral claims and how legitimacy influences a firm-manager’s obligations of fairness to these stakeholder groups. A concept of directness, consisting of close and relational specific exchanges, is introduced to explain this legitimation process. Directness offers accountability and reliability when an obligation of fairness is owed to those stakeholders that have a legitimate stake to a firm’s business activities. This directness-legitimation process influences a firm-manager’s fairness obligations and provides an important normative underpinning to the stakeholder concept.