Beyond Shareholder Primacy: Interrogating the Stakeholder Governance Paradox Through Institutional Logics and Organizational Ambidexterity

Abstract

Contemporary corporate governance frameworks have increasingly positioned stakeholder theory as a normative corrective to shareholder primacy, yet empirical validation of this transition remains fragmentary. This study critically interrogates the stakeholder governance paradox—wherein managerial accountability to plural stakeholder constituencies generates structural tensions that undermine organizational coherence and strategic alignment. Drawing on institutional logics theory and a mixed-methods design encompassing 312 publicly listed firms across emerging and advanced economies, we demonstrate that unmediated stakeholder pluralism significantly attenuates decision-making velocity and capital allocation efficiency. However, organizations exhibiting high degrees of structural ambidexterity successfully reconcile these competing logics. The findings challenge prevailing normative assumptions in governance discourse and propose a contingency-based stakeholder integration model with robust implications for board-level policy and managerial practice.