BEST Education Network: Think Tank VI

Corporate Social Responsibility for Sustainable Tourism

Exploring Clarkson’s Typical Corporate and Stakeholder Issues

Model as an Approach to Understanding Corporate Social
Responsibility in Tourism: the Case of Lonely Planet
C. Papaleo and S. Beeton

Catrina Papaleo
School of Sport, Tourism and Hospitality Management
La Trobe University, Victoria 3086, Australia
cspapaleo@students.latrobe.edu.au

Sue Beeton, PhD

Director of Research
School of Sport, Tourism and Hospitality Management
La Trobe University, Victoria 3086, Australia
s.beeton@latrobe.edu.au

Abstract:
In today’s world of growing concern over the social and environmental effect of tourism, the
responsibility for the future of our society is moving from simply relying on our political leaders
and interest groups towards the concept that corporations also need to be socially responsible for
their actions. With the global reach of tourism comes a responsibility to those places and people
that constitute our ‘product’ – the stakeholders. This paper explores the notion of stakeholder
theory within the realm of Corporate Social Responsibility by studying the case of travel publisher
Lonely Planet, looking at its internal and external stakeholders and their concepts of the social
responsibility of the organisation.

Key Words: Corporate Social Responsibility, tourism, stakeholders

Introduction
In an economy of abundance, the responsibilities of businesses extend beyond the profit motive, not
only serving that business but also the goals of society (Lazer, 1996). For the past 45 years,
numerous commentators have stressed the importance of organisations being responsible for the
effects of their activities on a broader scale, beyond their shareholders (for example, see Davis,
1960; Carroll, 1979, Wartick and Cochran, 1985; Clarkson, 1988). However, numerous economists
maintain that a corporation’s sole responsibility is to maximise profits for their shareholders (or, if
not a publicly listed company, their owners), including Friedman (1962) and later Backman (1975).
Mayr (1988) supports this notion, claiming that corporations’ need to keep up with their
competitors, who may not address the wider environmental or social actions of their operations
renders it nigh to impossible for an organisation to operate in a socially-aware manner without
forgoing market share and profits.
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However, with the shift towards environmental conservation in the 1970s and 1980s, it has become
generally recognised that an organisation’s responsibilities must extend well beyond the notion of
profit making to social responsibility (Carroll, 1999). The increase in ‘ethical investing’ in the 21st
Century has contributed to this change in corporate approaches through consumer pressure (see
Beeton, 2006).

The term, corporate social responsibility (CSR) has gained prominence and, while a definitive
definition has not been agreed upon, it encompasses the need for corporations to consider their
activities in terms of the economic, legal, ethical and discretionary aspects (Carroll, 1979). Joholin
has defined CSR as including ‘the openness or transparency of companies as well as taking into
consideration the will and expectations of their stakeholders’ (Juholin, 2004, p.22). This definition
of CSR suggests that the relationship between companies and their stakeholders is critical for
business success.

There is a range of theories associated with the term CSR, which include profit maximisation theory
(Aupperle, Carroll and Hatfield, 1985), ethical theory (Saiia, Carroll & Buchholtz, 2003), political
theory (Riggins, 1988), and stakeholder theory (Freeman, 1984; Clarkson, 1988, 1995). Of these
four theories, stakeholder theory has particular resonance. This theory holds that organisations have
a responsibility that extends beyond their shareholders, as they must also be accountable to any
group in society who has an interest in the organisation (Quazi, 2003).

As Clarkson (1988; 1995) notes, identifying the types of behaviour that could serve as indicators
was a major issue that had to be dealt with. Based on a ten year study, Clarkson (1995) developed a
stakeholder framework for analysing and evaluating CSR which has been applied in this paper, and
is outlined in Figure 1. The framework identifies six stakeholder groups: the company, employees,
shareholders, customer, suppliers and public stakeholders such as the government and other interest
groups.

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Figure 1: Clarkson’s Typical Corporate and Stakeholder Issues Model
1 Company 4 Customers
1.1 Company history 4.1 General policy
1.2 Industry background 4.2 Customer communications
1.3 Organisation structure 4.3 Product safety
1.4 Economic performance 4.4 Customer complaints
1.5 Competitive environment 4.5 Special customer services
1.6 Mission or purpose 4.6 Other customer issues
1.7 Corporate codes
1.8 Stakeholder & social issues management systems

2 Employees 5 Suppliers
2.1 General policy 5.1 General policy
2.2 Benefits 5.2 Relative power
2.3 Compensation & rewards 5.3 Other supplier issues
2.4 Training & development
2.5 Career planning
2.6 Employee assistance program
2.7 Health promotion
2.8 Absenteeism & turnover
2.9 Leaves of absence
2.10 Relationships with unions
2.11 Dismissal & appeal
2.12 Termination, layoff, & redundancy
2.13 Retirement & termination counselling
2.14 Employment equity & discrimination
2.15 Women in management & on the board
2.16 Day care & family accommodation
2.17 Employee communication
2.18 Occupational health & safety
2.19 Part-time, temporary, or contract employees
2.20 Other employee or human resource issues
3 Shareholders 6 Public Shareholders
3.1 General policy 6.1 Public health, safety, & protection
3.2 Shareholder communications & complaints 6.2 Conservation of energy & materials
3.3 Shareholder advocacy 6.3 Environmental assessment of capital projects
3.4 Shareholder rights 6.4 Other environmental issues
3.5 Other shareholder issues 6.5 Public policy involvement
6.6 Community relations
6.7 Social investment & donations
Source: Clarkson (1995: 101)

Clarkson (1995) proposed that the performance of corporations in terms of the social activities can
be measured more effectively by applying “… a framework based on the management of a
corporation’s relationships with its stakeholders than by using models and methodologies [simply]
based on concepts concerning corporate social responsibilities and responsiveness” (Clarkson,
1995: 92). He stresses that ‘stakeholder’ is not another term for ‘shareholder’, and that the social
purpose of an organisation to distribute value to all primary stakeholders sits hand-in-glove with
economic imperatives.

This model is particularly pertinent to the tourism industry, which is reliant on its stakeholders, not
only to support it, but to provide the actual tourism product and/or service. Tourism stakeholder
theory has tended to focus on external stakeholders such as communities, government, tourists and
suppliers, particularly in terms of ‘big picture’ planning, whereas a key stakeholder group is the
employees of an organisation. Human resource issues such as communications, training and
development, stress and mental health as well as equity and discrimination were identified as

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important by Clarkson (1995). This group has been identified as a primary stakeholder group.
Primary stakeholders are those “… without hose continuing participation the corporation cannot
survive as a going concern” (Clarkson, 1995: 106).

While there have been many calls for tourism to consider its stakeholders, the main focus has been
on NGOs such as destination marketing organisations, government organisations and public-private
partnerships, primarily in relation to planning (see Bramwell and Lane, 1993; McKercher, 1993;
Jamal and Getz, 1995; Bramwell and Sharman, 1999). Wheeler (1995) maintains that there is little
empirical research supporting the assumption that the tourism businesses themselves need to
consider their relationship with their stakeholders within the broader CSR concept. While this
statement is over ten years old, the gap remains, with Kay (2004) confirming that empirical data
supporting the belief that organisations are now taking social responsibility measures seriously in
relation to the prime goal of profit maximisation are limited.

Consequently, the purpose of this paper is to test the effectiveness of Clarkson’s (1995) Typical
Corporate and Stakeholder Issues Model (Figure 1) to establish the link between CSR and tourism,
which is explored through a case study.

The Case of Lonely Planet

Lonely Planet is one of the world’s most recognised travel brands across both print and digital
media, and is promoted by the company as the information source for millions of independent
travellers on their journeys world over (Lonely Planet Publications, 2004). The company was
selected as the case for this paper due to its stated principles to behave in an ethical and socially
responsible manner. These principles are that “[t]ravel can be a powerful force for tolerance and
understanding. As part of a worldwide community of travellers, we want to enable everyone to
travel with awareness, respect and care” (Lonely Planet Online, 2006). In addition, Lonely Planet
“… embraces the thousands of people whose lives are affected by tourism, the businesses we do and
don't recommend, and the environments travellers explore, armed with information we provide on
ethical and responsible behaviour” (Lonely Planet Online, 2006).

Further evidence of Lonely Planet’s commitment to the ethical and discretionary elements of CSR
is illustrated by the existence of the Lonely Planet Foundation. ‘Giving back’ has always been part
of the picture at Lonely Planet, with its charitable policy beginning in 1987 (the Lonely Planet
Foundation brochure, n.d.). It donated AU$500,000 to aid Tsunami relief (the Lonely Planet
Foundation brochure, n.d.), which is a perfect example of the organisation’s sense of giving. The

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Lonely Planet Foundation sources help from an outside not-for-profit partner, Charity Aid
Foundation (CAF), and prefer to donate to charities that meet one or more of the following criteria:
 Grass-roots, non-domestic projects
 Emphasis on education and health
 Clear outcomes through local initiative and support
 Empowering the local community.

However, without adequate education and support of their internal stakeholders such as their staff, it
will not be possible for Lonely Planet to maintain a true commitment to CSR. This raises the
question as to how does the company relate such principles to their internal environment?
Consequently, this study investigates whether stakeholder theory in terms of CSR is a viable notion
to deploy in an organisation offering a tourism-related product reliant on multiple stakeholders such
as Lonely Planet.

Method
Stakeholder theory, in the form of Clarkson’s (1995) Typical Corporate and Stakeholder Issues
model is applied to the case organisation (Lonely Planet) as a conceptual vehicle for analysis. A
qualitative approach was employed, drawing on a combination of interviews and document analysis
to outline the reasons, motives and management principles for CSR, and to also determine the
nature and role of CSR in Lonely Planet.

As noted by Clarkson (1995), the issues identified in the model need to be clearly identified and
data gathered by asking corporations to provide descriptive information on the company and
relevant social and stakeholder issues. Following Clarkson’s methodology, this was achieved in
this study by undertaking in-depth interviews with representatives of each stakeholder group.
However, the category, ‘public shareholders’ was excluded due to the fact that Lonely Planet is not
a publicly listed company. Instead, ‘the natural environment’ was added due to its interrelationship
with tourism and significance in other studies on CSR in tourism. Whether it can be seen as a
‘stakeholder’ is open to debate, however the environment is not static or passive, and exerts its
influence on tourism activities, and vice versa.

Table 1 provides information on the stakeholder groups interviewed. Ten interviews were
conducted over the five stakeholder groups in the research process. One interview was conducted in
the company category, which also covered the shareholder category, as the co-founder of Lonely
Planet is one of the main shareholders who co-owns seventy per cent of the private company. Five

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employees from Lonely Planet were interviewed and these respondents were sourced through an
invitation to participate sent via the Lonely Planet staff email. Customers were recruited through the
method of snowball sampling, which is used with difficult to reach participants as the researcher
may not be informed about network connections (Jennings, 2001). Finally, one supplier was
interviewed as identified by the company.

Table 1. Summary of Research Interview Process

Number Interviewed Recruitment Method
Company 1* Company records
Employees 5 Invitation to participate
Shareholders 1* Company records
Customers 3 Snowball sampling
Suppliers 1 Identified by Lonely
Planet

TOTAL 10
*
Denotes that the same person was interviewed for these categories

In a case study analysis, documentation is most important to triangulate the results by corroborating
and augmenting information from other sources (Yin, 2003). In this study, documentation was
obtained from the Lonely Planet website and in confidence from the co-owner of Lonely Planet.
Documents were in the form of articles appearing in the mass media, memoranda, and other written
reports. Documentation was preferred as a method of data collection for a number of reasons. First,
documents are useful to verify the exact spelling and titles or names that might have been
mentioned in the interview process. Second, documents are stable and can be reviewed repeatedly
(Yin, 2003). Third, suppositions can be drawn from documentation, prompting new questions to be
asked, as well as new areas to be explored. Fourth, documentation offers corroboration for what is
said in the interviews in the form of methodological triangulation. Finally, documents provide broad
coverage as they may cover a long span of time, many events, and many settings (Yin, 2003).
Similar to the interview data, the documentation used in this study was analysed through the process
of coding.

Findings
The findings provide an insight to Lonely Planet and their CSR activities, and also CSR in a general
tourism context. When discussing what CSR meant, the definition provided by the majority of
respondents was consistent amongst all stakeholder categories. It did not mean different things to

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different stakeholders, with the most common response being ‘doing the right thing’. There was a
lack of acknowledgment of the term ‘society’ in the common view of CSR of Lonely Planet’s
stakeholders as opposed to the common view of CSR (Jones, 1980; Juholin, 2004; Kok, 2001;
Steiner, 1971). However, responses indicated that by doing the right thing, organisations should be
using their resources to benefit the world, which draws a similarity between the common view of
CSR of Lonely Planet’s stakeholders and the theoretical definitions of this study. When asked
Lonely Planet’s motive for their CSR activities, the supplier stated ‘there’s nothing false about them
(Lonely Planet)’, which again demonstrates the positive organisational culture that exists at Lonely
Planet regarding their CSR. Furthermore, the phrase ‘corporate social responsibility’ was not
ambiguous to respondents, however it is questionable if a clear definition is emerging in terms of
what CSR means for stakeholder theory in organisations offering a tourism product.

Lonely Planet undertakes numerous CSR initiatives including the Lonely Planet Foundation and the
use of environmentally friendly paper and printing resources (see Table 2).

Table 2. Overview of CSR Activities at Lonely Planet

The Lonely Planet Foundation
Ancient forest friendly printing arrangement
The use of environmentally friendly and/or soy based ink
Strong responsible travel aspect to all guidebooks
Ensuring labour contracts are compliant with laws in Australia and overseas
Support local community events
Recycling paper
Turning the lights off at the end of the day

It was clear that the relationship between management and employees is strong, with the ethos of

the company being represented well by employees in their responses. Employees had a positive

view on Lonely Planet’s CSR, with all concurring that it is strong within the organisation. However,

one employee did state that ‘what we do at the moment is great but it is very grass roots, we need to

put more structure around it which is what we’re trying to do’. This leads on to the issue of

improving CSR at Lonely Planet, with every employee offering suggestions of how Lonely Planet

can enhance what they already do in terms of CSR. As one employee stated, ‘there’s more we can

do in our supply chain, we can do more in our Foundation, there’s more and more we can do in

everything we do, it’s about slowly but surely improving everything you do’.

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In terms of what the data suggests about Lonely Planet’s motive for engaging in CSR, it is clear that
their involvement originates from the co-founders. The giving nature of the company is instilled
into its culture and responses received from all stakeholders indicated that their activities are
genuine and not perceived as a marketing ploy. The measurement of CSR is an issue to arise from
the findings, with respondents not knowing how to measure CSR, with employees questioning ‘how
do you measure it’? A consensus view was that making an organisation’s activity sustainable is
appropriate, with sustainable by one employee being defined as a ‘series of goods been created by
our activity of benefit to the world’. This was also the case for Lonely Planet as employees did not
see a difference between any company and themselves.

However, the company and its employees were not overly concerned about how to measure their
own CSR as it was known that as a company, they were giving back to communities as much as
they can. Nevertheless, the issue of measuring CSR is a troublesome area (Abbott & Monsen, 1979;
Sirgy, 2002).

Discussion
The use of stakeholder theory as the conceptual framework for this study matches the research aim,
as the stakeholder categories outlined by Clarkson (1995) corresponded clearly with Lonely
Planet’s current stakeholders. Moreover, the issues outlined in Clarkson’s (1995) Typical Corporate
and Stakeholder Issues model provide a lucid way to approach the research design element of the
study. However, throughout the research process, it became increasingly evident that Clarkson’s
model was predominately based on human resource issues. The results found that there is a much
wider range of issues covered when exploring CSR in a tourism context such as then environment.
Therefore, Clarkson’s (1995) Typical Corporate and Stakeholder Issues model has been modified to
acknowledge the more specific range of issues identified in the data relevant to tourism as outlined
in Figure 2.

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Figure 2: CSR Framework for Lonely Planet

CSR
1. Awareness
2. Definition
3. Appropriate level
4. Motive
5. Channelling CSR

Company Employees Shareholders Customers Suppliers

Background Human Lonely Planet Supplier

1. Lonely Planet Resources Shareholders Awareness Relationship
2. Travel guides 1. Benefits 1. Structure of Lonely with Lonely
3. Reason for 2. Employee 2. Agreements Planet Planet
success relations 1. Lonely 1. Provision of
3. Training Planet services
4. Legislative 2. CSR 2. Policies
Human requirements 3. Products
Resources 5. Issues Shareholder 4. Communic-
1. Organisational Relations ation and CSR at Lonely
structure 1.Communication promotion Planet
2. Terms of between 1. Initiatives
employment shareholders 2. Personal
3. Economic 2. Shareholder contribution
CSR at Lonely
performance support
Planet Recomme-
4. Business 3. Communication
1. Initiatives with Chief ndations
competitors 2. Promotion 1. Lonely
5. Corporate Executive Officer
3. Employee Planet and
policies/ contribution CSR
statements 4. Employee 2.Communica
view on CSR at tion and
Lonely Planet Issues promotion
5.Improvements 1. Corporate re- 3. Customer
structuring contribution
CSR at Lonely
Planet
1. Initiatives CSR
2. Staff Views as a
3. Promotion shareholder as
4. Enhancing CSR opposed to co-
founder

Lonely Planet Policies The Role of the Environment

The Lonely Planet The Environment Can the environment be considered a
Foundation stakeholder?

Tourism and the Environment

1. Obligation of any Company
2. Obligation of a tourism company

Conclusion
While the research was primarily exploratory, the interviews provided a rich source of information,
showing that Lonely Planet was ideal case organisation for analysis, as the company offer tourism-
related products and give back financial and physical resources to the communities to which they
send their travellers. Stakeholder theory, the conceptual framework of this study, has demonstrated
that it can be used to examine CSR as it provides a way of adapting new approaches to the theory
(Black & Hartel, 2004; Maignon & Ralston, 2002; Schiebel & Pochtrager, 2003). In this instance,

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stakeholder theory in the form of Clarkson’s model has been used to interpret the nature of the
relationship between CSR in tourism.

While Lonely Planet’s socially responsible travel objectives could be likened to all of the CSR
perspectives, its application to stakeholder theory relates most closely to CSR. Stakeholder theory is
about taking into account society at large, and Lonely Planet prides itself on giving back financial
and physical resources worldwide for the benefit of directly related communities, the environment
and also their travellers.

The use of a stakeholder theory to ascertain the perceptions of Lonely Planet’s stakeholders was a
successful approach to take. It is these perceptions that informed the choices for the CSR
framework developed for Lonely Planet.

Although this research project has recognised the significance of the relationship between
stakeholder theory, CSR and tourism, the research opportunities relating to CSR and tourism are
numerous. This area is still an underdeveloped research topic, and there is much potential for CSR
and tourism to become a prominent subject in CSR and stakeholder theory literature. Applying
other CSR theories such as profit maximisation theory and ethical theory in and through tourism
creates many possibilities for future studies.

Further work has been undertaken on applying CSR to tourism by considering why and for what
purposes CSR is useful for Lonely Planet, as well as the stakeholders’ perceptions of CSR at Lonely
Planet. However, it is the application of the theoretical model that has been the focus of this paper.

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