Trust and well being in organizations-examination of the impact of organizational objective functions on stakeholder trust and well being.

• Applicant: Dr. Michael Pirson
• Subject Area: Accounting and Finance
• Term: from 2008 to 2009
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 61519234

The purpose of the proposed research is to examine two neglected aspects of organizational theory and their interplay. I intend to 1) research trust as the foundational element and 2) well-being as the objective function of organizing as well as their interaction effects.First, I wish to build on my doctoral research and examine stakeholder trust. Trust is commonly viewed as key enabler of cooperation, motivation, innovation and successful transformation (e.g. Shaw, 1997). However, prior research indicates that the organizational objective function is a crucial element to establishing trustworthiness. Shareholder value maximization e.g. is viewed as an opportunistic goal and thus detrimental to trust. In the proposed research, I intend to look at alternative organizational objective functions (shareholder value, social value, shared value, well being) and their impact on trust, well-being and organizational performance.Second, I will specifically examine well-being as an objective function for organizations. Diener and Seligman (2004) as well as Layard (2005), argue that well-being should be the central objective for policy creation. Currently many researchers are looking at the drivers of subjective well-being. Organizational effects, however, remain largely underresearched. I intend to identify effects of organizational structure, organizational objective function, and incentive systems on stakeholder well-being.Examining the interaction effects of organizational purpose, stakeholder trust and overall well being will add a new perspective to organizational theory and organizational design. The overall objective is to contribute to an enlarged theory of organizations including a view of alternative objective functions as well as their effects on the key foundational factor, trust.

• DFG Programme: Research Fellowships
• International Connection: USA
• Hosts: Professorin Nancy Etcoff, Ph.D.; Professor Deepak Malhotra, Ph.D.