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The formation of coalitions in a new market: The case of Socially Responsible Investments

The formation of coalitions in a new market: The case of Socially Responsible Investments. Elise Penalva Icher, University of Lille Filip Agneessens, Ghent University Catherine Comet, University of Lille Fabien Eloire, University of Lille. Social Responsible Investment. SRI in France

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The formation of coalitions in a new market: The case of Socially Responsible Investments

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  1. The formation of coalitions in a new market: The case of Socially Responsible Investments Elise Penalva Icher, University of Lille Filip Agneessens, Ghent University Catherine Comet, University of Lille Fabien Eloire, University of Lille

  2. Social Responsible Investment SRI in France • New type of investment market • Ethical, environmental and/or social criteria for investment (besides financial performance)

  3. The French SRI market • The emergence of a French SRI model: - first appeared in the 80s - 90s: extra-financial rating agencies (ARESE) • Need of extra-financial information • Heterogeneous actors: asset managers, brokers, extra financial rating agencies, lobbying associations, information providers about CSR, religious congregations, NGOs, trade unions…

  4. The emergence of a new market The process of mobilization of “institutional entrepreneurs”: * Economic growth: competition vs. coalitions (bounded solidarity) * Political influence: building a vision of the market * Legitimacy: being connected to people considered to be “important”

  5. Hypotheses

  6. 1) Structural hypotheses • Hyp 1 a : Influence is likely to be reciprocal. • Hyp 1 b : Influence is likely to occur in triadic cycles. + +

  7. 2) Homophily based on vision of the market • Hyp 2 : Cooperation is likely to occur more often between actors with similar visions about SRI. • niche • mainstream + + -

  8. 3) Perceived prestige Cooperation more likely: • Hyp 3a: with actors that are considered prestigious by ego himself • Hyp 3b: with actors that are overall considered as more prestigious by all relevant actors • Hyp 3c: with actors that are considered as more important by ego’s collaborators

  9. 4-5) Attributes • Hyp 4 : Collaborative ties more frequent between heterogeneous types of organizations • financial actors • direct suppliers • indirect suppliers • Hyp 5 : Starters more frequently involved in collaborative ties than other actors • pioneers • starters • followers

  10. Data and method

  11. Data and Method Fieldwork: ethnography & social network data (78 actors) • Co-workers network: dense, reciprocal and highly collaborative (a social “milieu”) • Reputation: individual perception of importance.

  12. Attribute variables • Actors in organizations (interdependence) • financial actors • direct suppliers • indirect suppliers • Time of entering the market : • pioneers • starters • followers • Vision of the market and its development : • niche • mainstream

  13. ERG Models • Exponential random graph models • Model local structural patterns: • dyadic and triadic (Wasserman and Pattison, 1996) • actor attributes (Robins, Elliott and Pattison, 2001) • multiplexity (Lazega and Pattison, 1999) • model specification and MCMC (Snijders et al., 2002, 2007) • Program: Xpnet (Wang, Robins, Pattison) (http://www.sna.unimelb.edu.au/pnet/pnet.html)

  14. Results

  15. 1) Structural effects • Positive reciprocity • Positive effect of triadic cycles • Bounded solidarity 2.21 (0.16) 0.09 (0.02)

  16. 2) Political influence Expectations regarding SRI development: • No homophily effect • But promoters of mainstream vision do collaborate with more actors than promoters of niche vision 0.22 (0.19) -0.24 (0.09)

  17. 3) Legitimacy People choose others that are considered to be more influential: • by themselves • by the group as a whole • by actors with whom ego collaborates 2.75 (0.16) 0.013 (0.006) 0.18 (0.01)

  18. Interdependencies • Financial actors are more collaborative • while direct suppliers are less and tend to collaborate more within their group • Pioneers collaborate more 0.33(0.10) -0.23 (0.11) 0.54 (0.19) 0.32 (0.10)

  19. Conclusion Mobilization of institutional entrepreneurs through different sub-processes: • Bounded solidarity (direct and generalized exchange) • Influence regarding vision of the market (no homophily/mainstream expansive)

  20. Conclusion Mobilization of institutional entrepreneurs through different sub-processes: 3) Legitimation (to collaboration with prestigious actors) 4) Different relational strategies depending on different types of actors

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