A Case Study of Stakeholder Distrust Management in the Context of a Sustainability Scandal

This paper addresses the growing interest in distrust as a distinct concept and its management in inter-organizational stakeholder relationships. Using a case study of an international organization facing stakeholder distrust after a sustainability scandal, we explore how distrust manifests and how stakeholder engagement aims, practices, and impacts mitigate it within multi-level inter-organizational dynamics (i.e., distrust management). Our study develops a process model based on three critical incidents, illustrating how distrust emerges and is managed. Our results contribute to the literature on distrust and stakeholder engagement research by providing rare empirical insights into distrust at the inter-organizational level and novel perspectives on stakeholder engagement’s multi-level dynamics in mitigating distrust, including its two components of value incongruence and malevolence.