Accounting Theory- Stakeholders

Accounting Theory- Stakeholders
Question: Taking into account Figure 3.4 on page 45 of your textbook (Stakeholder Typology: One,
Two, or Three Attributes Present) discuss the 'Ethics in Practice case' on page 46 (Are Plants and
Flowers Stakeholders? Do they have rights?)
Freeman (1984, P. 46) popularized the definition of a stakeholder as '. . . ANY group or individual
who can affect or is affected by the achievement of the organization's objectives'. This is a very
broad definition meaning that in today's global business environment any individuals and groups
may be business's stakeholders (Davey, 2015). This sparks the debate about whether or not the
natural environment can be identifiable as a stakeholder. In the ethics in practice case 'Are Plants
and Flowers ... Show more content on Helpwriting.net ...
Legitimacy–
This perceives appropriateness or a shareholder's claim to a stake. Stakeholder legitimacy is defined
as a 'desirable social good', and legitimate stakeholders are those that 'really count' (Mitchell et al.,
1997). Stakeholders with an obvious, formal and direct relationship to the company such as owners,
customers, and employees have a high degree of legitimacy. Authors excluding the natural
environment from being a stakeholder say the natural environment does not have a degree of
legitimacy because of it lack of human characteristics and a lack of perceived obligation between it
and organizations (Phillips and Reichart, 2000). However Haigh and Griffiths (2009) argue that the
natural environment is a legitimate stakeholder because managers address environmental issues to
maintain their 'right to operate'.
Urgency–
Urgency is the degree to which an issue requires immediate action (Mitchell et al., 1997). Extreme
weather, as a result of climate change fits this description because it can have devastating impacts.
For example, major environmental disasters (e.g. storms and tsunamis) demand urgency and power
as they often result in life threatening situations. This results in legitimacy as they require immediate
reaction due to the nature of destruction and the effects on the economic, physical and social
environment (Davey, 2015).
Power–
Power is the ability to influence others to
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Essay on The Stakeholder Theory by Thomas Donaldson
A stake holder, in general is defined as an individual or organization likely affected by the
performance of an organization. In "The stakeholder theory of the corporation: Concepts, evidence,
and implications" by Thomas Donaldson , he quotes Stanford research institution and calls stake
holders "those groups without whose support the organization would cease to exist."
Therefore a stakeholder can be thought of as some who both influences and is influenced by an
organization. According to Greasley (1999, p9) there are 3 types of stake holders: internal,
connected and external.
Internal stakeholders are described as "the managers and employees of a company." Connected
stakeholders are those that are beyond the immediate boundaries ... Show more content on
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However, for this scenario it will be assumed that the stakeholder concept stands, and hence will
assume the stakeholder concept is infallible.
It will be assumed that the large mining company is publicly owned and is situated a more
economically developed country (MEDC). Therefore the company will have significantly weaker
influence from the government than a government owned company. It will also imply that trade
unions associated with the company will likely be strong, hence workers will have higher influence
than they would in a less economically developed country (LEDC) where unions would be weaker .
The above assumptions will also help in identifying stakeholders within the mining company;
stakeholders will be divided up into the 3 defined in Greasley (1999, p9).
Firstly, internal stakeholders, those connected directly to the firm. This group include will account
for anyone working within the firm. In the context of the mining company, this includes people like
miners, even jobs like those of a janitor in the building. However, it is important to note that it also
involves much more powerful stakeholders like senior management, who play a large role in the
decisions made by the company.
Connected stakeholders, will include groups like shareholders, customers and suppliers

Shareholder Theory Vs. The Competing Ideas Of Stakeholders...
Business development really relies on two parties, the buyer and the seller. without either of them
you can never have a transaction. Today I am going to examine a few proponents to this business
cycle in relevance to shareholder theories versus the competing ideas of stakeholders theories. I will
not only develop a basis of each, I will take a deeper look into what the sole responsibility and how
these action may affect business as a whole. Finally I will take time to examine each and conclude
with a personal justification to each. To make a profit, that 's what most would say is the end goal in
every business for the most part. Shareholder theory also related with stockholder theory providing
a main emphasis on maximizing profit. Maximize profit within the corporation with the the help of
the appointed executives within the company. This theory avoid the aspect of moral obligations and
or socially responsible on the company 's dime. Much of this is to leave the company with smaller
cost, cheaper goods and finally hopefully a bigger customer base in the end due to lower cost.
Products may be built cheaper rather than spending extra on certain aspects. An easy example of this
can is a company going with cheaper steel versus high grade steel because longevity is not a factor.
While the sole emphasis within the shareholder theory is to maximize profit, Stakeholders theory
repeats that single idea but also add the responsibility label to it. Stakeholder theory is to create

Stakeholder Theory and Competing Concept
Introduction
Stakeholder theory was given by R. Edward Freeman, which was expressed many ways to represent
the stakeholder as an important part of the corporate responsibility. According to Stenberg (1996),
this stakeholder theory, is basically not capable to provide better corporate governance. He also
stated that, this theory is unable to provide a better view of business performance (Edward & Reed,
1983).
Currently, the stakeholder theory has been grown up from its origin and seen as the concept of Value
Maximization in the business firm. It is one of the important goals of the business organization
(Werther & Chandler, 2005). In the present time, stakeholder theory allows the business firms to
define the role and responsibility of ... Show more content on Helpwriting.net ...
This group is also known as the workforce of the company. The employees follow the duty, which
are mention in their job description.
The role of external stakeholders is also plays an important role in the growth of the business firm.
The biggest group of external stakeholders in a firm is the group of customers. This group is also
known as the primary stakeholders of the firm (Frémond, 2005). Customers mean, the consumers,
who use the services and products of the firm and invest their money in the development of the
organization (Werther & Chandler, 2005). It is the primary responsibility of the firm to satisfy the
customers, because high customer satisfaction allows the firm to enjoy good profits.
Another group of external stakeholders are suppliers, who provide raw material and other important
components and part to the firm to produce final products and services. Suppliers affect the
efficiency and ability of the firm to attract the customers (Brooks, Mllne & Johansson, 2002).
Government is the stakeholders that increase the ability of the firm to compete in the fair and free
trade environment. These stakeholders also allow the firm to concentrates on the ethical and integral
business practices and welfare of the employees as well as the customers (Jones, 2004). The
government defines regulations and work practices for the business firm and also give punishments
to those business organization, which breaks

The Stakeholder Theory
The Stakeholder Theory of the Corporation: Concepts, Evidence, and Implications Author(s):
Thomas Donaldson and Lee E. Preston Source: The Academy of Management Review, Vol. 20, No.
1 (Jan., 1995), pp. 65–91 Published by: Academy of Management Stable URL:
http://www.jstor.org/stable/258887 Accessed: 20/04/2010 23:08
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Unfortunately, anyone looking into this large and evolving literature with a critical eye will observe
that the concepts stakeholder, stakeholder model, stakeholder management, and stakeholder theory
are explained and used by various authors in very different ways and supported (or critiqued) with
diverse and often contradictory evidence and arguments. Moreover, this diversity and its
implications are rarely discussed–and possibly not even recognized. (The blurred character of the
stakeholder concept is also emphasized by Brummer, 1991.) The purpose of this article is to point
out some of the more important distinctions, problems, and implications associated with the
stakeholder concept, as well as to clarify and justify its essential content and significance. In the
following section we contrast the stakeholder model of the corporation with the conventional input–
output model of the firm and summarize our central thesis. We next present the three aspects of
stakeholder theory –descriptive/empirical, instrumental, and normative found in the literature and
clarify the critical differences among them. We then raise the issue of justification: Why would
anyone accept the stakeholder theory over alternative conceptions of the corporation? In subsequent
sections, we present and evaluate the underlying evidence and arguments justifying the theory from
the perspective of descriptive, instrumental, and normative justifications. We conclude that the three
approaches

The only legitimate objective of any firm is Maximization...
1. Introduction
"Corporate finance theory, teaching and the typically recommended practice at least in the US are all
built on the premise that the primary goal of a corporation should be the maximization of
shareholder value."
(Krishnan, 2009)
One often stumbles upon such statements while reading about shareholders value or maximization
of shareholders wealth. This is also a typical answer to questions such as "what is the best and
primary objective of a company in a competitive market". But should it be the only and most
important objective in a firm? Must it be fulfilled first and foremost, or is there the possibility of
generating more wealth for company, shareholders and stakeholders with other, different
approaches? It has ... Show more content on Helpwriting.net ...
4. Creation of Shareholder Value and protection against threats
To increase and maximize the wealth/value of shareholders, it is necessary that the company is
competitive in their market and can reliably "earn a considerable return on its investments above
their cost of capital" (Doyle, 2000). The increasing rates of return of well performing companies
attract new investors who invest money to become shareholders. These outside funds from investors
are essential for growth of businesses and the expansion into new markets. Measurements of
generated shareholder returns over a certain time period deliver the company useful information on
whether their objectives have been achieved or should be new adjusted (Atrill, 2009).
Nevertheless if companies operate in weak markets and fail to create growth and profit the concept
of maximization of shareholder wealth is also an opportunity for self–regulation and security against
threats for a company. This approach is in particular useful for safeguarding against difficulties
arising from wrong or misguided leadership within a corporation. Shareholders of a company have
the strongest interest in a company's success because they often invest a lot of capital in the business
and require revenues for their deposit (Moore, 2002). As a matter of fact, they become more

Stakeholder Theory Of The Firm
Even though the stakeholder theory of the firm served as a comprehensive fundamentally solid
concept for corporate social responsibility to branch out of; without the stakeholder theory of the
firm there is no corporate social responsibility and vice versa, because business cannot exist without
society and society is not sustainable without business, due to advancements in the modern world,
business and society have evolved, and traditional business theories have a narrow business scope,
while contemporary perspectives have a broader approach.
First, Without the stakeholder theory of the firm there is no corporate social responsibility and vice
versa, because business cannot exist without society and society is not sustainable without business.
According to R. Edward Freeman 1984, the stakeholder theory of the firm is about a conceptualised
thought of how a firm works and creates value (youtube video). So, in order for us to understand
what the stakeholder theory of the firm is about first the components of the theory should be
defined. Stakeholders are groups or individuals who affect or are affected by the operations and or
decisions of the organisation and contribute or are a necessity to the success or failure of the
organisation. Stakeholders can be owners, managers, suppliers, employees, communities, financiers,
government, non–profit bodies and customers even sometimes competitors (Freeman). Next, a firm
is an establishment or a number of establishments that buy,

The Social Capital Theory ( Sct ) And Stakeholder Theory
Despite the conflicting nature between the social–capital theory (SCT) and stakeholder theory (ST),
the role of 'Corporate social responsibility' (CSR) is a factor for a majority of organisations to gain
an economic advantage amongst its competitors. Through globalisation, aspects involving profit
maximisation and business reputation have become the primary influences of the ST. Alternatively,
the minority of organisations engaging in CSR with the altruistic concern for the stability of the
wider community and society, reflects the moral influences of values and stakeholder obligations. In
summation, the internal objective of financial performance is dependent on the process that arises
from CSR application to the inevitable outcome of profit maximisation within an organisation, thus
re–enforcing the debate that is against altruistic form. The application of CSR is a multi–faceted
concept that may be perceived in an altruistic matter, hence emphasized through the minor
perspective of the 'social–capital theory'. This social–capital theory (SCT) extends upon one's own
personal values and beliefs, which are determined throughout each managerial life. In relation to the
supports by J. Cowley (2012), the assumption of CSR participation is considered an obligation
towards those in the wider community, whilst claiming to be an opportunity for consumers to
understand the business' social values (p. 422). In response to the increasing demand from societal

The Triple Bottom Line: Social And Economic Model
Triple Bottom Line Theory
Also opposing the economic model, Elkington (1998) opposed the economic model and coined the
term "Triple Bottom Line" (TBL). The term represents the idea that,addition of economic value is
not the sole aim of businesses but also addition of social and environmental value to achieve
sustainability. Such triple bottom line is formed by the following concepts (Crane and Matten,
2004). The Triple Bottom Line (Triple p) theory has rapidly gained recognition as a framework for
measuring theperformance of the business. The actions of the firm refer directlyto anyone who is
influenced, either indirectly or directly. The primary bottom line is all about profit, for example, the
bottom line is improved by increasing revenues ... Show more content on Helpwriting.net ...
Given their influential position and the enormous impact of business organizations in modern
society, the purpose they should serve is discussed by theorists in various fields. The stakeholder
theory of the firm is probably the most popular and influential theory to emerging the CSR area
(Stark, 1994). The stakeholder perspective argues that the interests and values of all parties that hold
a stake in the organization should be taken into consideration (De Wit &Meyer, 2002), Carroll
(1989) the word `stake´ refers to having "an interest or a share in an undertaking". While the term
stakeholder was first recorded in the 1960s, the theoretical approach was in the main developed and
presented by Freeman (1984) in the 1980s. Several authors (Carroll, 1989; Harrison & St John,
1994; Rhenman, 1967) define stakeholders as individuals or groups who in some way affect or are
affected by the organization. Lee (2006) and Smith (2003) say that most firms understand the
importance of managing relations with key stakeholders. Firms that have been successful in this
area have done more than simply issuing press releases and responding to

Shareholder Theory Or Stakeholder Theory
#1 Shareholder theory or stakeholder theory "There is one and only one social responsibility of
business – to use its resources and engage in activities designed to increase its profits so long as it
stays within the rules of the game, which is to say, engages in open and free competition without
deception or fraud." (Friedman) Friedman's word perfectly defines the shareholder theory. However,
stakeholder theorists, like John Mackey or Edward Freeman, argue that business has an ethical
obligation to all stakeholders, including employees, suppliers, costumers, society and any other
groups of people that the business has a relationship with. Personally, I am more inclined to Milton
Friedman's sentiment for various reasons demonstrated as below. First of all, when business
becomes more profitable, the whole society may indirectly benefit from it. As the companies grow
larger, they spontaneously need to hire more people and thus create more job opportunities.
Moreover, they will also pay more tax as they earn more money, which is beneficial for reallocation
of wealth and social equity. Most of all, businesses themselves are sometimes the best gifts to the
society. For example, I don't really care about how much money Microsoft donates to charity, but I
do appreciate that it makes personal computers accessible for every individual in a reasonable price.
If it hadn't "focused so relentlessly on increasing its profits, cutting his costs in the process", I would
not be able even to

Seminar 2 Essay example
Stockholm University
Stockholm Business School
Business Ethics
Seminar 2
Contextualisation Case 6
Corporate governance of professional football clubs: for profit or for glory?
Shadan Abdullah(930514–6541)
Per Jonsson (780827–0479)
Victor Savigny (902710–P154)
Pui Shan Szeto (921026–P500)
Omkar Vedpathak (940126–P152)
The main stakeholders of football clubs, their 'stake' in the organization and legitimacy of their
interests.
Some European football clubs have in, approximately in the last three decades, developed from
being relatively small local organizations, into global giants in terms of multi–million businesses
supported and followed by millions of stakeholders from all over the world. How does one relate ...
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With normative stakeholder theory one tries to explain (in these settings) why football clubs should
take into account the interests of the stakeholders. It is easy to sympathize with the customer group
in this matter. They are the foundation stone that has built the club through the years and they have
invested money, emotions and their private time. But they are not as important as they once was for
the club. This given that another stakeholder group (Suppliers e.g. broadcasting companies,
sponsors etc.) now serves the business with monetary funding's, hence the times have changed.
Ultimately though, the suppliers will almost certainly vanish if the customers stop buying the
product. Shareholders and employees can easier than the customers in this case find another
business to join, they are not exclusive in the same way as the customers.
The descriptive stakeholder theory can also be useful to the settings in trying to state whether and
how the football clubs do listen to the stakeholder's interests. Also in this context the clubs can rely
on their loyal customer base. Even though if you treat them bad (expensive tickets, changing the
club badge and colors etc.) they will not ultimately stop buying the product. You might however as a

owner/ shareholder have a customer rebellion on your hands. Shareholders can more easily sell their
stocks if they feel neglected by the club, suppliers will search for other

Milton Friedman Analysis
Who should benefit, and at whose expense when running a business? Milton Friedman maintains
that profit is the only true goal, benefitting the stockholders. However, R. Edward Freeman proposes
that the needs of all a business's stakeholders must be balanced when acting. I support Freeman's
view because the environment has changed since the time of Friedman.
Milton Friedman believes the idea of businesses having some sort of responsibility to society is a
baseless notion, and describes discussions encouraging it as lacking meaningful analysis or
precision. "What does it mean to say that 'business' has responsibilities? Only people can have
responsibilities" (Friedman, p.218)1. Corporations are led by executives which are chosen by the
owners ... Show more content on Helpwriting.net ...
Maintaining an archaic business model would be foolish. Friedman argues that an executive should
not take profits away from the company to donate to the poor due to his own responsibilities. He
then uses this to state that business should never perform any sort of act benevolent to society if it
would not further the pursuit of profits. Unfortunately for Freidman's point of view, the blind pursuit
of profits is more often viewed as wicked and immoral (Friedman, p.222). Government regulation is
much more prevalent. Focusing on profits in today's market would soon lead your business on a
sharp decline. Moving from solely focusing on the duty to stockholders, Freeman suggests treating
all stakeholders of a business as more than a means to an end (Freeman, p.233). This can also
benefit the stockholders, as by focusing solely on increasing profits, firms can often incur the wrath
of government, forcing their hand, much like with the separation of AT&T into eight separate
companies (Freeman, p.234). Stockholders are the primary beneficiary of corporation, and their
money should not be spent frivolously, but it would be difficult to turn a profit if your suppliers,
employees and customers all desert you. Each group of stakeholders has their own desires, which
must be weighed and considered, for should one leg of business fall, the entire firm will come
tumbling to the ground.
The view that profit is the only responsibility for corporations is outdated. Friedman's argument may
have been valid in the past, but no longer applies. Regulation and law have increased the influence
of other stakeholders. To ignore that fact would be corporate

The Managerial Shift Toward Stakeholder Relationship...
There has been a shift in managerial attitudes toward, and consideration for, social and
environmental issues in recent decades (Parnell, Scott, & Angelopoulos, 2013). While mangers have
traditionally been obligated to work for the good of the shareholder, widespread adoption of the
stakeholder theory demands that managers seriously consider the impacts of the firm's decisions on
all affected outside parties, or stakeholders (Boatright, 1994; Parnell et al., 2013). However,
purchasing and supply chain management (PSCM) in practice seems to remain oriented toward
profit maximization, though interest in social responsibility is growing (Ferrell, Rogers, Ferrell, &
Sawayda, 2013). The managerial shift toward stakeholder relationship management has been
evident, yet the extent to which PSCM departments have embraced stakeholder theory is less
obvious.
This is problematic because PSCM is a developing discipline (Spina, Caniato, Luzzini, & Ronchi,
2013). Knowledge of actual policies and practices is important, as future research cannot address
real world problems based on assumptions. The purpose of this study is to determine the degree to
which stakeholder theory has been incorporated into companies' PSCM policies. This exploratory
research will fill a gap in the PSCM literature, informing future research by providing scholars with
a clearer understanding of the degree to which stakeholder theory has been adopted in PSCM.
Literature Review
Traditional and Stakeholder

Aramex Case Study
Question1:
In this part, I will discuss the importance of the management at Aramex and its acts on their
conviction regarding the impacts of the company on outside interests. Then, I will reflect on the
theoretical conceptualization of strategic CSR that can be applied to Aramex taking into
consideration the current positioning.
Aramex, a leading provider in the logistics and transportation solutions sector, is a leader in the
region in terms of internalizing and institutionalizing strategic CSR and sustainability. Aramex seeks
to enable and facilitate regional and global trade and commerce and helps local and global
companies connect with one another. It builds on a flexible business model and high investment in
people and technology. It is ... Show more content on Helpwriting.net ...
Ghandour believed that corporate culture was particularly important in attracting, managing,
motivating and retaining talent. Aramex's corporate culture reflected the values of its leaders, who
consistently attempted to nurture and demonstrate empowerment, respect, and innovation. Instilling
and internalizing these values was an arduous process of continuous education, training and
reinforcement. The importance of organization corporate culture appear in the improving the
performance and the workflow in different areas such as identity, competition, reputation, quality,
productivity, loyalty, unity and employee retention. Sustainability and social engagement are an
integral part of Aramex' corporate culture and day to day business. Management at Aramex is driven
by the conviction that social and business benefits are not mutually exclusive, but rather reinforce
each other. The company's health and growth is seen as dependent on the well–being of society at
large and on the communities in which it operates. CSR and sustainability are viewed as necessary
to the company's success. A shift of focus from share value to shared values is central to Aramex's
position on CSR and

Blackmores Company Analyses
7001MKT Corporate Communications
Semester 1 2014
Assessment 1: Company Analysis
Blackmores Company Analysis
Table of Contents
Executive Summary 3
1.1 Introduction to Blackmores 4
1.2 Industry & Activities 4
1.3 Blackmores Organisational Structure 5
1.4 Media Presence 5
1.5 Stakeholder theory 6
1.6 Blackmores Stakeholders 7
1.7 Corporate Identity Theory 8
1.8 Blackmores Corporate Identity 8
1.9 Corporate Identity Interpretation 11
1.10 Conclusion 12
References 12
Executive Summary
Founded in the 1930's, Blackmores has grown to become Australia's leading brand ... Show more
content on Helpwriting.net ...
They accomplish this by sourcing the highest quality ingredients from around the world, combined
with innovative research and development to deliver products that have become industry standards
in the health supplements sector (Blackmores, 2014).
Blackmores manufacture, wholesale, distribute, market and retail their products creating a stable
and reliable environment for the company to operate (Blackmores, 2014). While Blackmores does
retail some of their products the majority is distributed to naturopaths, pharmacies, health food
stores, supermarkets and mass merchants (Blackmores, 2014).
Blackmores is also committed to a strong business performance, with a strategic direction
concentrated on delivering growth and continuous improvement to increase and maintain their
leading market position and to achieve continued success for the company and its stakeholders.
(Blackmores, 2014). They believe in growth by acquisition and diversification of products and
market channels (Annual Report, 2013). By diversifying, Blackmores ensure their company does

not become reliant on a single product or line which can affect the stability and sustainability of
their business. Each year Blackmores invest over $2 million in research and development projects
(Annual Report, 2013).
1.3 Organisational Structure of Blackmores
Blackmores is currently a publicly traded company with 16.97 Million shares valued

Corporate Governance : Good Business Management
The general idea we have in mind when we hear the term "Corporate Governance", is that it is an
almost unattainable goal. The reason is the only companies that have "corporate governance" are big
businesses with exorbitant capital, or, at least have shares on the stock–market. It is based on the
idea that applying good organizational governance practices, is exclusive and expensive. But those
who argue this idea are very far from reality. I must confess that I was one of these people.
Currently all companies regardless of their capital or size, implement some system of administration
(Knell 2008, p. 5), i.e. they have a "Corporate Governance".
Why is it important to discuss Corporate Governance?
Good "Corporate Governance" is ... Show more content on Helpwriting.net ...
Furthermore, each company has different objectives and seeks their own benefit. When they have
corporate governance practices in common it influences the economy of a country, and therefore
growth in their development. This is because the investors or "financial institutions abroad, will be
more attracted to inject resources". Consequently, the companies will access to better conditions in
international capital markets, being, ultimately, less exposed to the economic crisis.
Who is in charge?
Currently, the "underlying theoretical concepts" are applied in order to understand or explain, the
roles and behaviours of members of corporate governance.
Firstly we find the "agency theory", refers to the owners and managers of the companies that have
different interests. That is, the shareholders or owners should confront the problems related with
managers, who may be acting based on their own interest.
In "management theory", the organization seeks a structure with contents. The management is
control, and direction is "spans the action program of the economic unit"; shareholders and
executives create partnerships. Moreover, in "stakeholder theory" the function of the "board
directors" is to represent the interests of the members in the organization. Finally, the "dependency
theory" refers to organizations which are dependent substantially from other organizations and
external resources (2012, p.

The Disaster Damaged Bhp 's Reputation And Benefits
As the shareholder of Samarco, the disaster damaged BHP 's reputation and benefits. BHP needs to
prepare huge funds for the clean–up bill, potential fines and compensation for those injured or killed
people. In stock market, BHP took a beating in trade after the disaster. BHP fell 5.7 per cent in
London and grappled with the lowest iron prices in a decade. The exact cause of the burst dam is
unclear because the investigation is still continuing. However, a 2013 assessment by the
independent Brazilian organisation highlighted concerns about the integrity of the tailings dam and
recommended against renewing the licence which was ignored by Samarco (Ricardo, 2016). people
have doubted that whether other tailings dams of BHP around the world is structurally sound and
raised eyebrows about how they manage the risks at other operations. The disaster raised the
suspicion of dependability of tailings dams at other mines owned by BHP. Besides, this disaster
reminded people of past failures including the collapse of the BHP Ok Tedi tailings dam in the late
of 20st century which is also considered as one of the worst environmental disaster (3). More and
more people begin to criticize the operation way of BHP and lose the confidence for BHP due to
their failure of diligence responsibilities. The following paragraph on this essay will discuss and
analyze whether BHP's behaviour is ethical or unethical through shareholder and stakeholder
theories. The shareholder theory was

Theories Of Stakeholder Salience
Stakeholder salience is a descriptive theory which is used to qualify the types of stakeholders,
mapping who matters and is influential for the company. The authors of this paper firstly believe
that portfolio companies employees aren't valued enough by the Private Equity firms. In order to
investigate this statement, the stakeholder salience theory was chosen in order to analyze whether
the implementation of the better CSR initiatives reporting could enhance their salience.
The Theory of Stakeholder Identification and Salience by Ronald K. Mitchell, Bradley R. Agle and
Donna J. Wood (1997) responds to the plethora of definitions regarding what is a 'stakeholder' and
the lack of consensus regarding 'Who and What Really Counts' in stakeholder ... Show more content
on Helpwriting.net ...
Mitchell et al. (1997) define power as the degree to which a stakeholder has or can use coercive
(physical), utilitarian (material) or normative (prestige, esteem and social) means to impose its will.
Reputation wise, Gifford (2010) claims that power is linked to reputation risks. Public or private
statements, depending on how powerful they are, affect the reputation of an organization. Hence, a
successful engagement of the stakeholders may exert impact on reputation, through power.
LEGITIMACY is a generalized perception that the actions of an organization are desirable, proper
or appropriate within some socially constructed system of norms, values, beliefs and definitions
(Mitchell et al., 1997). Within the salience model, legitimacy is divided into three types: individual,
organizational and societal legitimacy. Individual: depends on perceived professionalism, status and
level of experience. It is the ability to build trust and develop a good relationship with management.
Organizational: is the level of credibility the organization enjoys in the market. Societal: is the level
of support the community express for the subject of

Stakeholders Theory
The stakeholder theory is a theory of organizational management and business ethics that addresses
morals and values in managing an organization.[1] It was originally detailed by R. Edward Freeman
in the book Strategic Management: A Stakeholder Approach, and identifies and models the groups
which are stakeholders of a corporation, and both describes and recommends methods by which
management can give due regard to the interests of those groups. In short, it attempts to address the
"Principle of Who or What Really Counts."[2]
In the traditional view of the firm, the shareholder view (the only one recognized in business law in
most countries), the shareholders or stockholders are the owners of the company, and the firm has a
binding ... Show more content on Helpwriting.net ...
In contrast, Stakeholder theory argues that every legimate person or group participating in the
activities of a firm do so to obtain benefits and that the priority of the interests of all legitimate
stakeholders is not self–evident.
Donaldson and Preston offer four central theses related to stakeholder theory.
1) Stakeholder Theory is descriptive in that it offers a model of the corporation.
2) Stakeholder Theory is instrumental in offering a framework for investigating the links between
conventional firm performance and the practice of stakeholder management.
3) Although Stakeholder Theory is descriptive and instrumental, it is more fundamentally
normative. Stakeholders are identified by their interests and all stakeholder interests are considered
to be intrinsically valuable.
4) Stakeholder Theory is managerial in that it recommends attitudes, structures, and practices and
requires that simultaneous attention be given to the interests of all legitimate stakeholders. |
Diagram/schematic of theory | | Diagram/schematic of theory | | | | | |
At a minimum, stakeholders are those groups from whom the organization has voluntarily accepted
benefits, and to whom the organization has therefore incurred obligations

Freeman And Martin Shkreli
The primary sense of the term [business ethics] refers to recent developments and to the period,
since roughly the early 1070s, when the term came into common use in the United States" (George,
Web). This means that business ethics has become a huge deal over the last recent years.
"Additionally, Martin Shkreli acted unethically when he raises the price of a useful drug to certain
people who needed it to survive. One person that would argue that Shkreli was acting unethical is R.
Edward Freeman.
A website in the internet informs that Martin Shkreli was born to Albanian and Croatians
immigrates, and he grew up with two sisters and a brother. Moving one, the article states that
Shkreli attended Hunter College High School and started interning ... Show more content on
Helpwriting.net ...
Edward Freeman would believe just the opposite. Freeman believes the opposite of Friedman.
Freeman argues the opposite by stating that "the basic idea is that businesses, and the executives
who manage them, actually do and should create value for customers, suppliers, employees,
communities, and financiers [or shareholders]" (Freeman, 39). This passage suggest that Freeman
believes in the stakeholder theory, and that a stakeholder can be anyone: an employee, a customer,
the community, etc. Freeman counter argument to Friedman is that Shkreli forgot the most
important rule in modern business, "The customer is always right." Friedman theory might have
been ethical to use in the old days, but in recent years a business being ethical includes taking it
customers opinion into account. Friedman fail to realize that workers and employees play a huge
role in business making profit. Additionally, the web states that "For decades, there wasn't any
competition to Daraprim for the simple reason that there wasn't much money to made selling it"
(McLean, Web). This is yet another prove that Shkreli didn't had a reason to raise its price. Because
they have no competition, then they didn't have a reason to raise it price. "He acquired the U.S.
rights to a lifesaving drug and promptly boosted its price over 5,000 percent" (Mclean, Web). All
things consider, it is understandable that the drug cost money to make, but raising the price to
5000% is outrageously high. For this reason, I believe that if he would have just double the price, it
would have been such a huge deal/unethical. Moving one, in Freedman's eye Shkreli failed to take
his customers into account, and what is worst he hasn't apologized to its customers. Overall
customers have become extremely important to a business, and if you failed to put customers first
the business will not be

Views on Corporate Social Responsibilities
Corporations practicing stakeholder management will be more sustainable. Discuss.
Introduction
The perceptivity of sustainability is both in the sense of achieving long–term success and as
survivability of a corporation (Zink, Steimle & Fischer 2008). Dunphy, Griffiths and Benn
(2003) conceive corporations as channels of social purpose, constructed within society to attain
useful social objectives. Henceforth, corporate social responsibility commits a significant role
towards the sustainability of corporations. Both corporate social responsibilities and sustainability,
and its related concepts influence all aspects of business. Chandler and Werther (2010) acknowledge
the understanding of corporate social responsibilities as an ... Show more content on Helpwriting.net
...
(Crane et al 2008) Despite over three hundreds billion in revenue and over ten billion in profits in
2007, Walmart with the conception to provide the best for consumers, dismissed the ethical customs
towards its employees and stockholders. On top of that, in order to build its reputation,
environmental concerns claimed were put aside.
Though, Walmart is now sustainable and has picked up itself since then, consumers are still very
concern and protesting against Walmart's corporate social responsibility.
For these reasons, corporations with classical governance are fundamentally associated with
negative intentions. The lack of empirical evidence in agency theory, the contemporary view on
corporate social responsibilities and its stewardship theory will be discussing below.
Contemporary View on Corporate Social Responsibilities
The success of the corporation in corporate social responsibilities demonstrates how well it has been
able to influence stakeholder concerns while executing its business model. Carroll relates corporate
social responsibility into a four level pyramid – economic, legal, ethical and philanthropic
responsibility, where his viewpoint is a hybrid between the classical and stakeholder view on
corporate social responsibilities. (Chandler & Werther 2010)
Abreast the

Essay on Friedman vs Freeman
What is ethically responsible management? How can a corporation, given its economic mission, be
managed with appropriate attention to ethical concerns? These are central questions in the field of
business ethics. There are two approaches to answering such questions. The first one is Milton
Friedman's shareholder theory of management and the second one is Edwards Freeman's
"Stakeholder" theory of management, two different views about the purpose and aims of a business.
Milton Friedman's shareholder theory of management says that the purpose of a business is to make
money for the owner or the stockholders of the business. Friedman says that there is only one social
responsibility for the business: to use its resources in order to increase ... Show more content on
Helpwriting.net ...
It says that you cannot look at any one of those stakes / stakeholders in isolation. Their interest has
to go together, and a job of a manager or an entrepreneur is to figure out how the interest of
customers, suppliers, communities, employees and financiers go in the same direction. Each of these
groups is important for the business to be successful and if one of the groups is having problems to
associate with the rest then it has a negative impact to all the rest.
In my opinion I believe that both theories have their own advantages and disadvantages and every
business has to follow a theory that complies with its goal, when in my case I would rather follow
the theory of Freeman in one extend. Friedman's position we can see it as a theory for short term
investment and businesses, while Freeman's theory targets businesses that are planning to stay for a
longer term. Also I believe that Friedman's theory affects society in an inefficient way when costs
are not really paid, as for example pollution, traffic congestion, no taxes, and poorly educated
workforce. Another problem with Friedman's position is that it assumes that forces of competition
are sufficiently vigorous, but they are not. In addition the distribution of income that results from
profit maximization is very

Essay on Tesco Csr Responsibilities
Part One: Identify the three most important CSR issues that the company faces and explain why
each is relevant for the firm. In order to identify these issues, you should read not only corporate
reports and the company's website, but also media reports and any research papers that offer
commentary on both the company's activities and its significant social and environmental impacts.
Part Two: Critically evaluate the nature and degree of the company's responsibilities in relation to
each issue. To do so, arguments should explicitly draw upon the theories outlined in class – e.g. the
various ethical theories, institutional and stakeholder theories. For each issue, you may draw upon a
variety of theories – i.e. present a ... Show more content on Helpwriting.net ...
This accumulation of undeveloped sites if developed, "could raise Tesco's market share from around
30% at the moment to a competition–stifling 45%." (Anon 2007) The 1000+ Tesco Expresses and
numerous suburban Superstores popping up throughout the nation not only drive up land prices for
local retailers and create ghost towns but also give a degree of monopolistic power. An economic
NEF report reveals that over the past twenty years local shops including butchers and greengrocers
"have been going out of business in the UK at the rate of 50 a week" suggesting that Tesco Express
stores have help to cause a drop in business of 30–40% from independent retailers (Oram et al
2003). This has resulted in many planning objections from local residents forcing Tesco to become
involved in costly public enquiries and planning appeals. With many taking a sinister view of these
land banks, future growth in the UK may well be stifled highlighting the relevance for Tesco in
appeasing locals and governments especially in light of past Competition Commission
investigations. 2._________________________________ i) Honest disclosure of source and quality
of food Tesco accepts fault for this issue in that they were negligent in choosing suppliers (Tesco
2013) and by offering public apologies online and in the media, suggests recognition of their
responsibility to society. Tesco have an enormous level of selling power with consumers having
little or no say in food

What Is The Stakeholder Theory Of Agency Theory
Agency theory
It is an acknowledged fact that the principal–agent theory is generally considered the starting point
for any debate on the issue of corporate governance emanating from the classical thesis on The
Modern Corporation and Private Property by Adolf Berle and Gardiner Means. According to this
thesis, the fundamental agency problem in modern firms is primarily due to the separation between
finance and management. Modern firms are seen to suffer from separation of ownership and control
and therefore are run by professional managers (agents) who cannot be held accountable by
dispersed shareholders. This separation of ownership from management and the resulting loss of
direct owner involvement in the firm forced many people to rethink the conventional wisdom about
the role of markets and the need for private ownership of capital in shaping ... Show more content
By expanding the spectrum of interested parties, the stakeholder theory stipulates that, a corporate
entity invariably seeks to provide a balance between the interests of its diverse stakeholders in order
to ensure that each interest constituency receives some degree of satisfaction (Abrams, 1951). The
stakeholder theory is therefore appears better in explaining the role of corporate governance than the
agency theory by highlighting the various constituents of a firm. Thus, creditors, customers,
employees, banks, governments, and society are regarded as relevant stakeholders. Related to the
above discussion, John and Senbet (1998) provide a comprehensive review of the stakeholders'
theory of corporate governance which points out the presence of many parties with competing
interests in the operations of the firm. They also emphasize the role of non–market mechanisms
such as the size of the board, committee structure as important to firm

Discuss the Influential Role That Agency Theory,...
1. Introduction
The paper reviews three important theories in corporate governance, different theories using
different terminology, and views corporate governance from different perspective. Some articles are
used to support these theories in this paper. From the Cadbury Report in 1992, we can get the
information that corporate governance is the system by which companies are directed and
controlled, which involves a set of relationship between a company's management, its board, its
shareholders and other stakeholders, and the objectives for which the corporation is governed. There
are mainly three important theories included in corporate governance, which are agency theory,
transaction cost theory and stakeholder theory, each theory views ... Show more content on
Helpwriting.net ...
As we know, a corporation is basically has three sets of interest, they are Managers, stockholders
and creditors. Stockholders often have conflicts with both banks and managers, since their general
priorities are different. Managers want quick profits that increase their own benefit, power and
reputation, while shareholders are more interested in slow and steady growth all the time. And the
purpose of agency theory is to identify the conflict point among corporate interest groups. Banks
want to reduce risk while shareholders want to maximize profits reasonably. Managers also think
about their own interest. The fact that modern corporations are based on these relations creates costs
in that each group is trying to control the others. Therefor agency theory as a theory of corporate
governance to help corporate alleviate the problems arising due to the separation of ownership and
control.
3. Transaction cost theory 3.1 Theory
This discipline was initiated by Cyert and March's (1963) A Behavioral

Stakeholders Theory, System Theories And Functionalist...
Theoretical conceptual framework
Conceptually, the three theories Stakeholders Theory, System Theories and Functionalist Theory of
Attitudes, have a significant function that is directly relating to this study. Stakeholders Theory
emphasized the need for the effort to identify the public and consider those publics need. Similarly,
Systems theory also relates to the study in a sense that the theory emphasizes on the relationship and
the structure of the organizations.
Functionalist Theory of Attitudes is an approach that explains the motivation of the public to exhibit
certain attitudes. The theory approach shows that we develop favorable attitudes toward activities
that aid us or reward us and form a negative certain attitude toward the ... Show more content on
Helpwriting.net ...
Talking about social responsibility in research management, it should be recognized that there are
not sufficient studies in this field as well (T. N. Atkinson & D. S. Gilleland, 2007; J. W. Osborne &
A. Holland, 2009). Social responsibility touches an institutional level, and individual responsibility
depends on institutional behavior. The institution's mission, strategic goals are related to the
organizational structure and its implementation which depends on employees' perceptions and
attitude. An employer should think of employees and take actions at the institutional level to
encourage social responsibility in employee perceptions and attitudes.
Factors that Influence Perception
A person's awareness and acceptance of the stimuli play an important role in the perception process.
Receptiveness to the stimuli is highly selective and may be limited by a person's existing beliefs,
attitude, motivation, and personality (Assael, 1995). Persons will select the stimuli that satisfy their
immediate needs and may disregard stimuli that may cause psychological anxiety. Perceptions is
suggests as our sense about the world around us, and it involves recognition of environment stimuli
and action in response to these stimuli through perceptual process. The numbers of factors that
operate to shape and sometimes distort that is

Stakeholder Theory : Managing A Firm Essay
During the late twentieth century, different ideas became popular about how best to manage a firm.
The first theory which emerged was Stockholder theory, which encouraged managers to act as
agents for the company's legal owners: it's stockholders. This theory held that it was the function of
a firm to act in the best interests of its owners by focusing on maximizing profits. Ensuring that the
stockholders' investments paid off was the fiduciary duty of the managers of this firm. However,
some managers did not feel this style of management was best for their firms. There were other
kinds of value that a firm could want to maximize, not just profits. A new theory emerged, called
Stakeholder Theory, which completely altered how managers did business. Stakeholders were those
who affect or are affected by a firm, and they fall into two categories: market stakeholders, who
exchange money like employees or customers and nonmarket, like the environment. It can be
challenging for managers to decide which stakeholders to prioritize, but a firm which uses
Stakeholder Theory can effectively earn profits as well as generate a positive value to the
community and environment in which it resides.
One firm which has made stakeholders a focus is Salesforce. The chief executive officer of
Salesforce is Marc Benioff, who has been outspoken about how important managing with the best
interest of stakeholders in mind. First, when he launched his firm, he also created the Salesforce
Foundation,

Stakeholder
Stakeholders, Shareholders and Wealth Maximization
V. Sivarama Krishnan, University of Central Oklahoma
ABSTRACT
This paper attempts reconciliation between the two somewhat extreme views espoused by the
shareholder wealth maximization paradigm and the stakeholder theory. The stakeholder theory
challenges the basic premise built into corporate finance theory, teaching and practice. Corporate
finance theory, teaching and the typically recommended practice are all built on the premise that the
primary goal of a corporation should be shareholder wealth value maximization. Extant theoretical
and empirical research in financial economics also generally accept shareholder wealth
maximization as the normative and ideal goal on which all ... Show more content on Helpwriting.net
...
This paper is an attempt at reconciling the two somewhat extreme views espoused by the
shareholder wealth maximization paradigm and the stakeholder theory. It aims to provide a fair and
balanced review of the two approaches to corporate goal setting and their respective implications to
business decision making. We also attempt to address what is felt as a lack of dialogue between the
two camps. The paper is organized as follows. The first part provides a summary view of the
shareholder wealth maximization approach, which we call the traditional finance paradigm. This is
followed by a review of the current research and the salient parts of the stakeholder theory. The
following section presents a summary of the critique of the stakeholder theory by two of the most
eminent and perhaps the strongest critics of the theory, Michael Jensen (2001) and Elaine Sternberg
(1999). This is followed by what we consider as our own insight into the stakeholder theory and our
attempt at reconciliation between the two approaches. The last section provides summary and
concluding comments.
THE FINANCE PARADIGM
The traditional finance paradigm puts the shareholder wealth maximization as the primary goal of
corporate management. This paradigm is built upon the classic competitive markets assumption.
Essentially, it is assumed that all participants who have transactions with a firm employees,
suppliers, customers, lenders, etc. – are

Friedman vs Freeman
This paper will have a detailed discussion on the shareholder theory of Milton Friedman and the
stakeholder theory of Edward Freeman. Friedman argued that "neo–classical economic theory
suggests that the purpose of the organisations is to make profits in their accountability to themselves
and their shareholders and that only by doing so can business contribute to wealth for itself and
society at large". On the other hand, the theory of stakeholder suggests that the managers of an
organisation do not only have the duty towards the firm's shareholders; rather towards the
individuals and constituencies who contribute to the company's wealth, capacity and activities.
These individuals or constituencies can be the shareholders, employees, ... Show more content on
Helpwriting.net ...
Consequently, the model of stakeholder by Edward Freeman has broadly considered as the strongest
theory regarding responsibilities of a company towards society where the company is located
(Freeman 2008 pp. 162–165). Nevertheless, Friedman pointed out that the profits has taken the
firms in to the hand of business intellectuals by which Friedman recommend that the financial
system by which the organisation run its business is in the restricted responsibility protection which
makes the organisations to privatise their profits (Friedman 1970 pp. 177–184). Friedman also
suggested that according to him the shareholder theory in terms of socially responsible can only
increase the profit. But on the other hand shareholder theory of Edward Freeman completely support
the theory of shareholder towards its role to be socially responsible in the society and maximising
the profits for the benefits of shareholders within the firms and society as well (Freeman 2008 pp.
162–165). According to Cosans (2009 pp. 391–399) with the taking of limited liability (restricted
responsibility) Friedman must have taken the business in a way to be socially affiliated and well–
established as well which also leads and supports the ethical and logical roots of CSR and for the
re–establishment of the reliability to

Key Tips For A Generous Financial Donations
STAKERHOLDER KEY TIPS
(1)Community
Stakeholders a. Generous financial donations
b. Innovative giving
c. Support for education and job training programmes
d. Direct involvement in community projects and affairs
e. Community volunteer programmes
f. Support for the local community
g. Campaigning for environmental and social change
h. An employee–led approach to philanthropy
i. Efficient and effective community activity
j. Disclosure of environmental and social performance
(2)Environment Stakeholders a. Environmental policies, organisation and management
b. Materials policy of reduction, reuse and recycling
c. Monitoring, minimizing and taking responsibility for releases
d. the environment
e. Waste management
f. Energy conservation
g. ... Show more content on Helpwriting.net ...
Good rate of long–term return to shareholders
b. Disseminate comprehensive and clear information
c. Encourage staff ownership of shares
d. Develop and build relationships with shareholders
e. Clear dividend policy and payment of appropriate dividends
f. Corporate governance issues are well managed
g. Access to company's directors and senior managers
h. Annual reports provide a picture of the company's performance i. Clear long–term business
strategy
j. Open communication with financial community
Source: (Spiller, 2000, pp. 153–154)
All the companies need a tool to exam their social performance (Hanson, 1995). The Spiller's (2000)
CSR model provide a tool that the corporation can diagnose their performance. And it can combine
various management technologies to develop the performance of the corporations. On the other
hand, it offered a tool to exam employee satisfaction (Spiller, 2000).
There are four main principles in Spiller's CSR model: Honesty, Fairness, Caring, and Courage.

First principle is honesty, which lying in the heart place of CSR model. The wise decision of the
companies and the modern economic market all need honest (Spiller, 2000). The participants in the
transaction will be deceived if the company lack of honest. Furthermore, the business system will
also be impact if the company lack of honest (Solomon, 1992). Second principle is fairness. This
principle requires the companies keep fairness with other relationships, which

What is the Stakeholder Theory?
Stakeholder can be defined as "any group or individual who can affect or is affected by the
achievement of the organization's objectives". This theory focuses on wider aspect rather than only
focusing on just the shareholder. Stakeholder theory is a fundamental theory about how business
works at its best and how it could work. It is concerning on the value creation and trade on how to
manage a business effectively.
A consequences of focusing on organization or company's stakeholder is that the shareholder value
itself can be enhanced and improved when a wider stakeholder group–such as employees, provider
or credit, customers, suppliers government and the local community is taken into account (Mallin,
2011). This theory also related to ... Show more content on Helpwriting.net ...
Simply moving operations from one part of the globe to another in the interest of shareholder value
will not eventually solve the problems of increasing global–stakeholders problems. A board that
pays less attention to the interests of its stakeholders cannot maximize its shareholder value.
However in relation to company performance, this theory has made a number of key contributions.
For example, by emphasizing on maintaining goodwill with stakeholders, the organization will have
a much better business ethics. Stakeholder ideas will develop the corporate value statements as well
as the board's role in creating corporate ethics codes, social and environmental reporting which
reflect an acknowledgement of a wider set of corporate obligations beyond only on shareholder
value.
Another contribution related to the company performance can be found in Kaplan and Norton's
(1992) ideas about the Balanced Scorecard and the revolution in performance measurement. This
Balance Scorecard embodies key stakeholder interests in a firm specific set of measures which link
important operational drivers to financial
performance. It therefore provides managers with a way to explore the organization's inter–
dependencies between customers' needs, and what the company must do in order to meet these
needs and sustain competitive success. It has both an immediate performance focus as well as
pointing to key areas for continuous improvement and innovation. From this

Comparing Shareholder Theories Of Starbucks Corporation...
Introduction
The interests of shareholders were always the primary objective of the corporations, and the
management primary duty was to maximise their financial profit. According to Milton Friedman
(1970), a corporate executive's only social responsibility is to create wealth for the shareholder and
to conduct the business in accordance with their desire. This perspective has been strongly
challenged and modified due to the negative impact of the shareholder theory. The global scandals
and crises which have been caused by the extreme interpretation of the shareholder theory have led
to the rising of the stakeholder theory where the interests of the employees, the customers, and the
local communities were taken into consideration and not been ignored as previously.
Scandals at Enron, Starbucks, Google, and Samsung indicate towards the failure of the shareholder
theory and triumph of stakeholder theory which lay principles that manager's role is to stabilise
financial interests of shareholders against the stakeholder interest. As per Laplume et al., (2008), the
shareholder and stakeholder theories are branches of corporate social responsibility's normative
theories, where managers and executives of a corporation must take decisions as per the 'right'
theory.
This essay reviews the business examples of Starbucks Corporation (UK) and Southwest Airlines
(USA) to evaluate the effect and application of both the shareholder and stakeholder theories. It
analyses the assertion that

Stakeholder vs Stockholder Theory
Larry Chapman Business Ethics Exam Two The Stakeholder theory of a firm is made up into equal
percentages on a pie chart, which is made up of Financials, Suppliers, Employees, Customers and
Communities. The Stockholder theory of a firm is made up by a pyramid structure consisting of
Labor, Management, CEO, Board and Stockholders. I believe the Stakeholder theory is less ethical
than the stockholder theory in terms of Libertarianism and Egoism. Libertarianism view points are
that there is no direct harm, not infringing on rights, not breaking the laws, government protection
only, free market and charity. The Egoism viewpoint is to maximize long–term self–interest. The
Stakeholder Theory is less ethical from the Libertarianism ... Show more content on Helpwriting.net
...
So far everyone has the same common goal and for one to achieve their own goal they must help the
other to achieve their goal. The main driver force of a company is the labor, which everything starts
with them and flows into the shareholders. The Stockholder Theory is more ethical than the
Stakeholders Theory, because it must take a team and from the Utilitarianism viewpoint this creates
greatest happiness due to everyone achieving their goal to help others make their goal, which creates
the greatest happiness. In terms of a Libertarianism view on sexual harassment there is no direct
harm, because what is harm? Is harm just emotions or actual harm as in dying? Sexual harassment
has no direct harm in regards of the person that is harassed will still be here after the harassment and
not dead. It also does not infringe on rights, because we have the freedom of speech and a lot of
harassment is characterized as comments. Also there are no rights stated that sexual harassment is
legal or not legal. Sexual Harassment does not break the law, as in there is not a law for sexual
harassment. A lot of people see it as unmoral and unethical, but still it does not break the law. There
is no such thing as in government protection in sexual harassment, because no laws or rights are
stated. The free market and charity does pertain to the sexual harassment. I believe Sexual
Harassment does not exist in a Libertarianism view. Marketing is bad in terms of Deontology due to
it

Stakeholder Theory Vs. Stakeholder Thinking
Stakeholder theory and definition
Stakeholder is defined as "any group or individual who can affect or is affected by the achievement
of the organization's objectives" (Freeman 1984). Stakeholder theory, when introduced in the 1980s,
signify a major change in how relationships within a business might coexist and benefit one another.
The concept of "Stakeholder theory" or "stakeholder thinking" is about identifying groups who are
stakeholder in a corporation and manage them. It states that organizations are collections of several
different parties, each with its own goals and objectives. Stakeholder concept has been used, either
explicitly or implicitly, for descriptive purposes, and also as a framework from which different
theories and ideas can be derived. It offers an proper lens for consideration of more composite
perspective of the value that stakeholders seek as well as new ways to measure it. Stakeholder
thinking has emerged to understand the three interrelated business problems indicating the problem
of how value is created and traded, problem of connecting ethics and capitalism, and the problem of
helping managers think about management. Stakeholder theory can be upstretched with a full
different collection of ethical questions without any context to other theories.
Concept of stakeholder theory
Stakeholder theory was introduced by "R. Edward Freeman" (1984), also known as the "father of
stakeholder theory". His theory states that "the individuals or groups that may

Corporate Ethics Theory And Stakeholder Theory
One of many duties of a director is set under s131 of the Company Act 1993. This section of the act
let know that directors must act in good faith and in what the director believes is the best interest of
the company. Traditionally, the word company foretold under this section have been regarded to
devote solely to the company's shareholders. However, this notion is seen as immoral. This is
because according to the notion of corporate social responsibility, business must behave ethically,
represents a broader recognition of stakeholders and must take into account economic, social and
environmental inputs in the way it operates. Hence, people against the notion of shareholder
primacy suggest that the director should also take into account the interest of a wide range of
shareholders (e.g. customers, employees, the society as a whole) in order to be deemed as moral.
This conflicting opinion raised the question, "To whom are the directors responsible?" This paper
will explore a number of corporate governance practices (i.e. agency theory and stakeholder theory)
that are related to this issue. It begins with the explanation of each theory and the discussion of
ethical and societal concerns they put forward, followed by the advantage of shareholders and the
disadvantage of other stakeholders regarding remedies of director's breach of duty from a legal
viewpoint and ends with a recommendation that would best reflect a good governance practice that
is consistent with the corporate

Maximizing the Corporate Objective with the Stakeholder...
Introduction The main contender to value maximization as the corporate objective is stakeholder
theory, which argues that managers should make decisions so as to take account of the interests of
all stakeholders in a firm, including not only financial claimants, but also employees, customers,
communities, and governmental officials. Because the advocates of stakeholder theory refuse to
specify how to make the necessary tradeoffs among these competing interests, they leave managers
with a theory that makes it impossible for them to make purposeful decisions. With no clear way to
keep score, stakeholder theory effectively makes managers unaccountable for their actions (which
helps explain the theory's popularity among many managers).
But if value creation is the overarching corporate goal, the process of creating value involves much
more than simply holding up value maximization as the organizational objective. As a statement of
corporate purpose or vision, value maximization is not likely to tap into the energy and enthusiasm
of employees and managers. Thus, in addition to setting up value maximization as the corporate
scorecard, top management must provide a corporate vision, strategy, and tactics that will unite all
the firm's constituencies in its efforts to compete and add value for investors.
In clarifying the proper relation between value maximization and stakeholder theory, the author
introduces a somewhat new corporate objective called "enlightened value

What Is The Stakeholder Theory Of Nike
Introduction
A stakeholder is an individual or association who can affect or be affected by the business's
activities. They might have neither direct nor indirect interest in the firms. Form a decent connection
between stakeholders and firms is vital because stakeholders can contact with the firm very often or
just in emergency situation to get up to date with the activities of the business. In one way or
another, the reputation of stakeholders are influenced by every activities of the business, therefore,
businesses ought to settle ethical decisions for a good image in the society.
There are many stories about how stakeholder theory has been approached lately from 1990s till
now and there is a featured story about Nike contract companies in Vietnam. In Nike's case, the
affected group of stakeholder is employees of the company. This essay will illustrate the concept of
stakeholder theory, analyse the case of Nike's contract company and how the ... Show more content
A corporate stakeholder is a person or group that can affect or affected by the actions of business
(Boundless, n.d.). There are two broad groups of stakeholder, internal stakeholders and external
stakeholders. Internal stakeholders are parties who directly involved in the activities of the firm such
as owners, managers and workers. External stakeholders are people outside of the business for
example are customers, suppliers, creditors, government and the society. (BBC, n.d.) (Boundless,
n.d.). Further more, different stakeholder has its own interest in the business, employees want their
wage to increase, manager or owners want to maximize the business's profit, the society wants
products that help to develop the community and consumers want products that meet their demand.
Through an overview, all the stakeholders have diverse impacts on the company and it depends on
the approach of the

Social Responsibility in Stakeholder Theory
Table of Contents 1. Introduction 2 2. Social responsibility in stakeholder theory 3 2.1 Why social
responsibility? 3 3. Limitations 4 4. Case study examples: Starbucks & Nike 4 5. Conclusion 5
6. References 6 7. Appendixes 9 Appendix A 9 Appendix B 10
1. Introduction
This report focuses on social responsibility issue focusing on stakeholder theory. Social
responsibility will be introduced and defined based on stakeholder theory. Next, analysis on the
importance and limitations of social responsibility will be shown based on reputable published
articles, followed by examples of two successful companies on how social responsibility affects
their business. Lastly, conclusion will be concluded based on findings on ... Show more content on
Helpwriting.net ...
Moreover, there is no evidence that engagement in social responsibility guaranteed better
performance than company that focus on profitability, (Vogel, 2008).
4. Case study examples: Starbucks & Nike
According to Starbucks (2013), Starbucks had solidified net revenue of $13. 3 billion, an
approximately 14 percent growth, (Appendix B) shows the financial returns are consistently
increasing over the years, Starbucks (2013). This net increase shows the good economic
performance of Starbucks. Solely economic performance is not sustainable, Starbuck understood the
importance of emphasize on corporate social responsibility. Starbucks Global Responsibility
business strategy are synthesize with their culture and overall strategy. They focus on ethical
sourcing that they see these plants as an agricultural sustainability, whereby C.A.F.E (Coffee And
Farmer Equity) are practiced for continuous improvement on productivity, social and environmental
aspects, Starbucks (2013). Other than positive corporate image, Starbucks is exposed to more
business opportunity, for example one of the world largest populations, India. Recently, Starbucks
and Tata Coffee invested in a new plant in India, whereby the company sees it as an

Freeman vs. Friedman
Freeman vs. Friedman In their theories of how a business should operate, R. Edward Freeman and
Milton Friedman hold virtually opposite beliefs as to what businesses' responsibilities should be. In
favor of the Stakeholder theory, Freeman believes that any person or organization that has a "stake"
in the business should also play a role of participation in the business's actions and decisions. In the
other corner of the ring stands Milton Friedman, who holds the belief that said business is only
responsible for those that actually own stock in the business – the owners, or stockholders. A strong
believer in his reconceptualized Stakeholder Theory of the Modern Corporation, R. Edward
Freeman believes the key to success in business is ... Show more content on Helpwriting.net ...
Nowadays, after the passing of several bills constraining the actions of corporations, acting in a
similar manner would pose several legal and ethical issues. This is why, Freeman argues, this
ancient idea of managerial capitalism is no longer effective. After bashing the old idea of managerial
capitalism, Freeman starts explaining why his reconceptualized stakeholder concept is much more
logical. Freeman modestly articulates a stakeholder theory using the "narrow definition" of a
stakeholder, which includes those who are vital to the success and survival of a corporation.
Specifically, these stakeholders include owners, management, suppliers, employees, customers, and
the local community. As well as being directly connected with the corporation, Freeman argues that
the stakeholders are also interconnected with each other as well, and that each stakeholder is vital to
the survival of the corporation, and vice versa. Employees rely on the business to give them a
paycheck; the business provides their livelihood. Employees return the favor because they run the
business on a day to day basis. Suppliers are vital to the firm's success because the quality of the
raw materials purchased will determine the quality and price of the final good produced by the firm.
As a result, the firm is a customer of their supplier, and is therefore vital to their supplier's success.
The next stakeholder, customers,

Accounting Theory- Stakeholders

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