Introduction

The era of new public management (NPM)

The problem with stakeholders

The narrative

Discussion

Conclusion

References

Abstract

Purpose – The purpose of this paper is to focus on understanding of stakeholder attributes and attitudes towards privatisation. It examines the stakeholder attributes through the framework provided by Mitchell et al. (1997). By combining it with the concept of issue salience proposed by Bundy et al. (2013), it addresses the current gap in research on how stakeholders influence the process of privatisation.
Design/methodology/approach – This research uses a process research approach to examine the privatisation process in New Zealand’s electricity industry in order to explore contexts, content and process of change. By collecting real-time data during the period of privatisation, utilising a process approach provided the authors a view of the historical path and associated events which lead to identification of stakeholder attributes and attitudes towards privatisation.
Findings – The research offers a unique insight into stakeholder attributes exhibited by different groups during privatisation. The authors identified that during privatisation the government is the ultimate stakeholder who sets the rules of the game of privatisation by exhibiting the attributes of power, legitimacy and urgency. The attributes exhibited by other stakeholders were transitory and were impacted by issue salience. The authors also identified that stakeholders exhibiting all three attributes (the government) chose a non-response approach to deal with any conflicting issues raised by other stakeholders.
Originality/value – The research examined the new public management emphasis on the privatisation of state-owned enterprises (SOEs) vis-à-vis stakeholder groups, utilising the complementary concepts of stakeholder salience and issue salience. This research makes a contribution to stakeholder management theory in the public sector by identifying how various stakeholders influence the process of privatisation of SOEs.

Introduction

Since the early 1980s, privatisation of public enterprises has been a significant part of the political agenda for many nations, both developing and developed (Arocena and Oliveros, 2012). Often included as a component of the new public management (NPM) orientation towards governance, privatisation of state-owned enterprises (SOEs) has been put into practice in many nations across the industrialised West, including the UK, Europe, the USA, Canada, Australia and New Zealand (Diefenbach, 2009). The motivation for governments to undertake privatisation have varied, but these tend to emphasise economic, political and financial goals (Arocena and Oliveros, 2012; Megginson and Netter, 2001). However, the approach is controversial, with argument between proponents and detractors now a common feature of public discourse in those countries attempting to privatise its SOEs. As a reflection of its controversial nature, researchers have extensively examined privatisation to assess the financial and efficiency gains or losses that may result from it. However, improvement in the efficiency of SOEs that presumably results from privatisation may not be the ultimate goal of these efforts.