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Corporate-NGO Partnerships through Sustainability Labeling Schemes: Motives and Risks

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Submitted:

05 March 2019

Posted:

06 March 2019

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Abstract
This article analyzes the emergence of partnerships between corporations and nongovernmental organizations (NGOs) through voluntary product labeling schemes. The economics, management, and business literatures are reviewed to highlight cross-checking, consistencies, and complementarities among these disciplines. The objective is to identify and analyze the motives, risks, and joint benefits of partnering via voluntary product labeling, using examples from the agri-food sector. This study is an attempt to offer a framework of corporate-NGO partnerships by showing that the drivers and risks of each partner merge because each takes a step into the sphere of the other. The main risks – namely, a loss of profitability, credibility and legitimacy – are related to the financial and existential dependency and the asymmetric information between the partners in favor of corporations, inducing an ``NGO-capture'' risk.
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Subject: Business, Economics and Management  -   Human Resources and Organizations
Copyright: This open access article is published under a Creative Commons CC BY 4.0 license, which permit the free download, distribution, and reuse, provided that the author and preprint are cited in any reuse.
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