Corporate–NGO Partnerships through Sustainability Labeling Schemes: Motives and Risks

This article examines the development of partnerships between multinational companies(MNCs) and large nongovernmental organizations (NGOs) through voluntary product labelingschemes. First, the economics, management, and business literature are reviewed to highlightcross-checking, consistencies, and complementarities among these disciplines to identify and analyzethe motives of partnering via voluntary product labeling. This analysis shows that, throughsuch partnerships, companies and NGOs share similar objectives, viability and visibility andexchange essential resources, information and legitimacy. The development of shared goals andthe complementarity of resources are the basis for successful partnerships, but they also createa phenomenon of blurred roles between companies and NGOs. Each partner enters the other’ssphere, which allows for better communication among partners, a clear and common vision of thepartnership, a mutual trust, and a symmetric commitment of partners, necessary conditions forsuccessful partnerships. However, I show that this phenomenon also leads to new risks for partners:competition, “NGO-capture”, and inconsistency