A Theoretical Framework for Sustainability Initiatives from the Lens of Stakeholder Theory and Institutional Theory

This paper proposes a theoretical framework that synthesises two theories in explaining business sustainability initiatives. The relevant theories are stakeholder theory and institutional theory that are commonly employed in the corporate social responsibility and sustainability literature. The similarities and interrelatedness of these two theories are contended as complementing instead of competing. In fact, they are relevant to be linked to sustainability initiatives in explaining the motivation of such effort from the perspective of these theories. Moving forward, this framework can be employed as a theoretical foundation for empirical studies to obtain better prediction on the motives and reasons of sustainability initiatives from different contexts. Also, it will be employed to gauge the relevance of these theories in explaining the engagement of business in such initiatives.