The external legitimacy of manager, and company performance: Case of Cameroon

Abstract

Legitimacy defined in terms of the purpose of an action, refers to the external logic of the legitimacy of the manager in the sense of Schuman (1995) and cited by Stamford (2002) continues to be a concern for our study. However, it does not have an interdependent relationship with business performance. Thus, for supporters of shareholder theory, wealth is created only for shareholders. So the objective of this study is to establish the link that could exist between the satisfaction of external stakeholders and the performance of medium-sized enterprises in Cameroon. The data comes from 120 private companies in Cameroon belonging to different sectors of activity. Thus, the first hypothesis is confirmed, the second hypothesis is invalidated which implies that customer satisfaction has a positive influence on business performance. On the other hand, the satisfaction of financial institutions negatively impacts the performance of these companies, which goes against the patrimonial model which favors the satisfaction of shareholders’ interests as well as those of other stakeholders of the company.

Keywords: external legitimacy, manager, external stakeholder, satisfaction, performance

JEL Classification : M41

Paper type : Empirical research