From Organizational Inequality to Social Inequality: A Cross-Country Comparative Study in Morocco and Madagascar
Social life goes hand in hand with organizations and the role of companies on societal issues has already been demonstrated (Fridenson, 2008). They affect for instance the mode of economic development. They are also a transformation vehicle of markets and consumers through their products and services. Societal issues and business issues are irreparably tied up, but more research is needed on this link.
The purpose of this paper is to investigate how organizational processes in given institutional contexts contribute to social inequality at the national level. To do so, we propose to highlight and to analyze the social mechanisms operating through the comparison of two case studies. It takes organizational institutionalism as a theoretical background; as its concepts enables a comprehensive analysis of this topic.
Theoritical background and research gag that is addressed
The literature review consists of two parts. The first part will investigate the term of inequality in other disciplinary fields in order to enrich and specify the definition of inequality used in organizational studies. First we turn to philosophy and particularly to Rousseau for his definition and analysis of inequality (Rousseau & Bachofen, 2008). Drawing on him, we claim that organizations are per se a source of inequality, as they go hand in hand with social life. We then turn to sociology which defines inequality as a difference in access to rare and socially valued resources. We use more specifically the analysis of Tocqueville (Tocqueville & Raynaud, 2010) who features inequality by divergent conditions and social rigidity. Next the definition of equality in law which draws on the principle of isonomy is analyzed. At last an overview of economics, as this discipline produced a significant number of studies on the subject, and more specifically of how economic studies measure inequality will end this section.
In a second part, we investigate the notion of inequality in organizational studies and show that previous works have focused on the human resources dimension, tackling this question from within the organizations. However, the question of the role of organizational inequality in the production of social inequality needs attention (Spedale, Coupland, & Tempest, 2014; Van den Brink, Benschop, & Jansen, 2010).
In the third and last part of this section, we review institutionalist literature to help analyse the action of organizations and individuals. Institution is a powerful concept to understand the links between organization and inequality. Although the definition of institutions is not unambiguous, we adopt the idea of institutions as rationalized myths (Meyer & Rowan, 1977).. We also will review the three different forms of legitimacy: pragmatic, moral and cognitive (Suchman, 1995).
Methodology
We study our research question through two comparative case studies in the banking and financial sector: one Moroccan bank and one mutual guarantee company in Madagascar. Those two case studies are suitable to answer our research question for several reasons. First, both countries suffer from great social inequality. Madagascar faces extreme poverty but also significant social inequality. Regarding Morocco, 15% of the population lives below the poverty line. Second, the banking and financial sector is a well-known producer of inequality, but the mechanisms operating remain underinvestigated.
Data were collected during two one-week visits: one in Morocco and one in Madagascar. We conducted in-depth interviews of managers, of NGO’s executives which were specialized in the banking and financial sector and of executives of two consultancies firms involved in the process. Interviews averaged one hour. In Morocco, the author also visited local branches and classic agencies in cities and rural area. The primary data were completed with secondary data (reports and newspapers articles).
Main findings
The results of the case studies are mechanisms that explain how inequality in organization can lead to social inequality. We propose that the voluntary or forced exclusion of part of the population from the access to the services and products offered by the organization contributes to social inequality as they represent critical resources. We offer a graphic representation of those mechanisms and the way they work (could'nt be included here but is available if requested by the conference organizers)
Organizational inequality contributes to social inequality either if the organization decides to adopt a canonic strategic model and the “unprivileged non-client” decides not to become client or is rejected by the model, or if the organization decides to adopt an innovative strategic model but the“unprivileged non-client” still doesn’t feel to become a client. A parallel and reinforcing mechanism is at work when the organization rejects workers, and potentially innovaters, on the basis of the place of their education.
We propose to explore and explain those mechanisms in our paper.
Bibliography
Fridenson, P. (2008). Business History and History. In G. Jones & J. Zeitlin (Éd.), The Oxford Handbook of Business History. Oxford University Press.
Meyer, J., & Rowan, B. (1977). Institutionalized organizations: formal structure as myth and ceremony. American Journal of Sociology, 83, 333‑363.
Rousseau, J.-J., & Bachofen, B. (2008). Discours sur l’origine et les fondements de l’ineìgaliteì parmi les hommes. Paris: Flammarion.
Spedale, S., Coupland, C., & Tempest, S. (2014). Gendered Ageism and Organizational Routines at Work: The Case of Day-Parting in Television Broadcasting. Organization Studies, 35(11), 1585‑1604.
Suchman, Mark C. (1995). Managing Legitimacy: Strategic and Institutional Approaches The Academy of Management Review. Vol. 20, No. 3, pp. 571-610
Tocqueville, A. de, & Raynaud, P. (2010). De la deìmocratie en Ameìrique. Paris: Flammarion.
Van den Brink, M., Benschop, Y., & Jansen, W. (2010). Transparency in Academic Recruitment: A Problematic Tool for Gender Equality? Organization Studies, 31(11), 1459‑1483.