Between August and October 2018, I conducted the pilot study. I opted for a pilot, rather than a pre-test which would have required a complete ‘dress rehearsal’ (Yin 2014, p. 96), given the access difficulties I would face in this study, and the fact that I am a doctoral student developing research skills rather than an experienced researcher. I chose to focus my energy on the pilot study as the final stage in preparing for the main study’s data collection. In the pilot, I addressed methodological and data collection issues, helping me to further develop and make informed choices about the key lines of enquiry, and to develop the conceptual model of the study. It also supported me in refining the interview protocol and process, and in testing my own ability as interviewer. In the next sections, firstly I provide a brief description of the pilot structure; secondly, I introduce the participants, and explain how I identified and
selected them; and thirdly I elaborate on how I went about deepening my understanding of the context of the study. I then present the pilot results and how they informed the subsequent choices I made for the focus and design of the main study.
Pilot Structure
In June 2018, I obtained my institution’s ethical approval to enter the field, and during the summer months I planned the pilot study. The planning phase included parallel streams of activity: drafting the interview protocol and the informed consent form, identifying and selecting participants, and identifying and selecting secondary data sources that would help me develop a richer understanding of the context of the study. For this phase I prepared the Informed Consent Form and the Interview Protocol (presented in Appendix 2 and Appendix 3 respectively). I will now elaborate on these two important instruments.
While drafting the interview protocol and preparing for my first contact with potential participants, I designed the Informed Consent Form which I signed and emailed to each participant in PDF format upon confirmation of the interview date. The form was counter- signed and returned to me either via email or by handing in the original copy on the interview day. The informed consent introduced me and the purpose of the study (Creswell & Poth 2018). It also outlined participants’ rights and my duties towards them. I based the form on the notion that participants had the right to understand the scope and nature of the project they were agreeing to become part of. I was keen to offer them the overall picture of this study, rather than just presenting them with a set of questions. Participants also had the right to refuse to answer any questions or to withdraw from the interview at any time (Schwandt 2015). In the informed consent form, I also addressed issues of confidentiality and
anonymity, explaining how results would be reported and how the use of quoted material would be managed. I also explicitly requested written permission to audio record the interview and outlined how I intended to ensure their anonymity, and the safety and confidentiality of the data they would share with me.
The interview protocol consisted of seven main questions, carefully aligned to the initial conceptual framework, ensuring that each question addressed one key aspect of the
framework: namely corporate purpose, institutional investors, and director engagement with corporate purpose. In order to understand the relationships between these topics and
concepts, at this stage I kept the questions quite broad and general as I wanted to discover what the most relevant issues would be from the participants’ perspective. The first two questions were intended to enable me to understand how the participants appreciate corporate purpose and when they believe it matters most. The choice of these questions was in line with my intention not to assume what purpose is, or that it is important, but rather to discover in the field whether indeed this was the case. The first two questions were as follows:
Question 1: ‘What is corporate purpose, in your view and in your organisation’s view?’
Question 2: ‘When does corporate purpose matter most?’
In question 1, when enquiring about purpose, I specifically distinguished between the interviewee’s and the organisational view, as I could not assume they were the same. I had a range of assumptions about how participants would understand corporate purpose, from the reason why the corporation exists, to its social purpose, to how it creates value, from short- term maximisation of shareholder value or profit, to long-term value creation. I checked the
correct translation of the expression ‘corporate purpose’ in German, and verified with my support network (which includes native German and Swiss German speakers) that the term Konzernzweck is commonly used in the fields of business and governance. During the interviews I referred to Konzernzweck when I felt that German-speaking participants would appreciate hearing a familiar term next to the English expression ‘corporate purpose’.
Through the five pilot interviews it became evident that participants had their own view of corporate purpose and tended to dismiss the organisation’s view. When I probed them on the company’s view, participants confirmed that it was the same, adding comments such as
‘otherwise I would not work here’ or ‘if they understood our purpose differently I would not serve on this board’, or referring me to the annual report or documents they confidentially shared with me. Questions 1 and 2 in turn introduced the second set of questions designed to break down the dynamics of engagement with corporate purpose and its elements:
Question 3: ‘Can you describe your engagement with corporate purpose?’
Question 4: ‘When does director engagement with corporate purpose matter most?’
During the interviews I adjusted the wording of these questions and adapted them to make them relevant to the specific interviewee. For instance, when interviewing the managing director of a corporate governance proxy advisory agency, I adjusted question 3 to ‘What experiences have you had of directors engaging with corporate purpose?’, as the aim was to collect evidence on the experience of this participant with director engagement. With regard to question 4, the words ‘matter most’ were chosen deliberately and informed by Leblanc (2003) who, in the context of a study on board effectiveness, did not assume that boards matter but used a specific question in the pilot study to verify whether this was indeed the
case. Similarly, I considered it important to gain insights from the interviews as to the context in which director engagement matters most. I also was interested in exploring whether
specific factors emerging from the literature review as potentially influencing engagement with purpose, for instance ownership, lifecycle or industry, would in fact be mentioned by the interviewees. In turn, these questions led to the third set of questions related to investors. I intentionally made reference to investor stewardship and activism, as I wanted to explore whether participants perceived them differently and whether engagement would emerge as a crucial form of stewardship practice via investor activism. Questions 5 and 6 were as follows:
Question 5: ‘What role do investor stewardship and activism play in ensuring corporations can serve their corporate purpose?’
Question 6: ‘How do investor stewardship and activism influence director engagement with corporate purpose?’
Question 5 was designed to understand better the link between investor activism and purpose- driven corporations, by which I mean corporations which place corporate purpose at the heart of their business. I used these expressions as synonyms. Question 5 aimed to identify the mechanisms through which the aims and actions of stewardship and activism interplay with corporations serving their purpose. My objective was to uncover a range of ESG factors and their link to corporate purpose and director engagement. Question 6 was designed to
understand the influence of investor stewardship and activism on how directors engage.
Question 7 concluded the interview protocol and aimed to capture future opportunities, challenges and developments with regard to director engagement and the broader field of governance.
Question 7: ‘What are the main developments, opportunities and challenges concerning directors and their engagement with corporate purpose?’
In July 2018 I started to keep a journal where I would capture my field-notes, documenting activities, observations, reflection, thoughts and anything that came to mind on any day or, often, at night. This journal is different from the extensive note-taking I had conducted during my doctoral studies. I wanted to start a new record that would develop in parallel to the development of this thesis, serve as a key element in capturing the evidence for this thesis and support my interpretation. Since the journal itself is thick and heavy, I also equipped myself with a mini paper notebook which I carried with me everywhere, so that I could write down on the spot anything I considered worthy of an entry. Once at home, I would copy my field-notes into the journal, expanding them as appropriate. I also disciplined myself to read the whole journal at least once a week, making further notes, framing questions and open points in my mind and on paper. At times I only wrote down a big question mark, indicating that on that day I felt quite confused or overwhelmed. Overall the pilot study informed the research strategy and design of the main study. It provided me with detailed feedback on what participants in the field understand by some of the words and terminology I used, and it gave me ideas on how to refine the research questions so that they would become more meaningful, and potentially more relevant to the target set of participants in the main study. It also suggested alternative avenues and perspectives, often relating to current or recent policy and practice issues (for instance, ESG, sustainable investing, and regulatory changes toward integrated reporting).
Pilot Participants
I carefully designed the identification and selection of participants to maximise the opportunity to collect rich data and uncover a broad range of issues related to director
engagement with corporate purpose. I will return to the point of participant identification and selection as two distinct phases connected by access activities in the section entitled Data Collection. At this stage, it is important to clarify that an ‘identified’ participant was a participant I had targeted, while a ‘selected’ participant was one who took part in the study either via direct consent or as a way for me to overcome certain access difficulties. I
considered the pilot a critical phase of the research process, as it represented an opportunity for me to discover, learn, focus, ponder and adjust as needed in preparation for the main study. Over the course of four weeks, from end of July 2018 to the end of August 2018, through four iterative draft lists of candidates and three phone calls with my support network, I identified a short list of five participants who then turned into selected participants without major access constraints. The criteria I used to identify and select participants included: elite membership and exposure, as participants needed to be members of managerial and
governance elites (directors), with roles which exposed them to the phenomenon I was researching; and organisational type, as participants had to represent a variety of organisations (not-for-profit, for-profit, listed and private corporations), in different institutional and governance systems. I was also mindful of participants’ background and previous exposure to contexts that could enrich the interview data, allowing me to dig deeper into the subject. Although I had made the decision to study the Swiss empirical context (as described in the section entitled The Swiss Context) as most appropriate in answering the research questions of this study, I used the pilot to play devil’s advocate and explore non- Swiss contexts and non-listed corporations. I was interested in allowing issues to surface, to
ponder on my choice of listed corporations and on Switzerland, so I aimed to maximise variety. With regard to the term elite, in this study I adopted the definition proposed by Pettigrew (1992) as ‘those who occupy formally defined positions of authority’ (p.123), as it is succinct yet broad enough to encompass members of the business/investment, community and political spheres of interest to this study. I will return to this term at length in the section entitled Data Collection. Table 1 (below) presents an overview of pilot participants.
Table 1 Pilot Participants Participant
Role
Organisation Headquarters Location Chief Human
Resources Officer
Private, global corporation of the outsourcing and technology industry
UAE
Chief Financial Officer
Not-for-profit, global sport federation
Switzerland Managing Partner Governance
advisory and proxy agency
Switzerland President National business
federation
Switzerland Legal Counsel &
EVP Public Policy
Fortune 500, listed corporation of the
communications and technology solutions industry
US
I aimed to identify and select participants from organisations located in different institutional and governance environments in order to maximise potential variations in the data. This is in line with the literature review, and in particular with the claim that variations in institutional settings may significantly affect and contribute to explanations of governance mechanisms (Adams, Licht & Sagiv 2011; Hooghiemstra, Hermes & Emanuels 2015), potentially
influencing how directors engage with purpose, and that institutional forces at national level need to be integrated with behaviours at a company level to better understand governance practices within corporations (Aguilera, Judge & Terjesen 2018). The final choice of the US and the UAE alongside Switzerland was guided by the literature. In the national business system (NBS) literature (Grosvold & Brammer 2011; Whitley 1998, 1999), Switzerland features among the coordinated market economies, with two-tier boards (a board of directors
labour relations, powerful business networks and a view of the corporation as an institution and a coalition of various participants. In contrast, the US is appreciated as a liberal market economy, with market-balancing industrial relations and competition complementing
extensive industry collaborations. In the US, corporations are regarded as an instrument in the hands of shareholders, and governance structures generally include one-tier boards where the same person holds the positions of Chair and CEO. However, the NBS literature overlooks emerging and developing economies, such as the United Arab Emirates (UAE) (Fainschmidt et al. 2018). These economies include the majority of the world’s population and, since 2013, most of the global purchasing power (The Economist 2013), hence I considered it important to include at least one country from this group. I complemented the NBS literature with the most recent literature on institutional systems (Fainschmidt et al. 2018), which views the UAE (among other Gulf countries) as a centralised, wealthy, tribe economy, a ‘paternalistic institutional system’ where ‘the family is the state’ (p. 316), featuring the direct dominance of a welfare state, a low level of organised labour relationships and a developing appreciation of corporate governance, with a focus on governance awareness and the encouragement of the application of governance principles. The UAE institutional system appeared to be in stark contrast to Switzerland and the US, potentially maximising variances.
Of the five pilot participants, three were Swiss nationals (two males and one female), and the remaining two were American and Indian citizens, both males. The participant short list included the Chief Human Resource Officer (CHRO) of a private corporation headquartered in the UAE and active in the business of service outsourcing for governments. This
participant had previously served in the same capacity in a large, listed Swiss corporation and in two Asian listed corporations, all three exposed to shareholder activism. The second
participant was the Chief Financial Officer (CFO) of a global, not-for-profit sport federation based in Switzerland, and had previously served as CFO of a Swiss listed corporation in the travel and entertainment industry. The third participant was the managing partner of a Swiss- based corporate governance and proxy advisory agency mainly serving the national market.
The agency advises investors on ESG issues and voting. The fourth participant was the president of the Swiss Business Federation representing the interests of the business community vis-à-vis national and international institutions and society, and is the leading consultative partner for the Federal Government. The fifth participant was the general
counsel and member of the executive board of a Fortune 500 US listed corporation operating in the technology industry. As director, he had led the board response to the letter from BlackRock’s CEO Larry Fink ‘A sense of purpose’ (Fink 2018), inviting investee
corporations to articulate their purpose and the governance structures they had in place to achieve long term value creation. At the time of the interview, this participant was also leading the dialogue on behalf of his corporation with institutional investors and US policy- makers on the subject of purpose-driven corporation.
I approached four participants directly, as I knew them personally from my previous executive and governance work. A telephone call from a member of my support network served to introduce me, and the study, to the fifth participant (the general counsel of the US listed corporation), who promptly agreed to participate and invited me to contact him
directly. I scheduled all interviews swiftly, except the one in the US where the interview date had to be rescheduled twice due to changes in the participant’s travel schedule. From the beginning of the study I adopted a simple rule which proved to be quite effective: I would offer maximum flexibility in terms of interview dates, timings and locations. Participants
(and their assistants) appreciated that I made scheduling as easy as possible for them: I never cancelled or rescheduled an interview; I provided them with succinct yet comprehensive background information; and I prepared thoroughly for each interview. In this phase, being in situ in Switzerland for seven weeks (and in the UAE and the US for two interviews) allowed me the flexibility needed for this research journey. Participants agreed without hesitation to my recording the interviews and raised no issues concerning the interview protocol or the informed consent form.
I conducted five semi-structured, open-ended, face-to-face interviews which lasted on average 68 minutes, with the shortest 41 minutes and the longest 98 minutes. The pilot made me realise that aiming for one-hour interviews would make it easier to get an appointment with the elite members I was targetting than a two-hour interview. I also realised that in my introductory email I should indicate an approximate interview duration of 50-60 minutes, as I knew from experience, confirmed in the pilot phase, that directors might wish to keep a buffer of five to ten minutes between meetings. All pilot interviews were audio recorded and conducted in English. I used a high-quality but unobtrusive audio-recording device, in order that, once placed in front of participants, it would not distract their or my attention during the interview, while still providing very clear audio quality to ensure accurate transcriptions of the interviews. As expected from this elite group (Pettigrew 1992), participants tested my knowledge of their organisation, their own background and the topic, that is, they tested my professionalism. I was well prepared for each interview so felt a certain degree of confidence, and displayed the utmost respect and gratitude for the hospitality, time and insights
participants shared with me. The interviews were intense, requiring my full attention, as well as time management, and the ability to gauge whether I had expressed myself clearly or