Who Are Stakeholders Stakeholder Theory Essay Example | Topics and Well Written Essays - 3000 words

Who Are Stakeholders Stakeholder Theory - Essay Example "the social community (state authorities;..and civil society)." From this definition we see that shareholders are both internal and external members of the organisation community. Milton Friedman's (1912) stipulated that the only social responsibility of corporations is to provide a profit for its owners stands in direct contrast to those who claim that a corporation's responsibilities extend to non-stockholder interests as well. Such a broad conception would include suppliers, customers, stockholders, employees, the media, political action groups, communities, and governments. A more narrow view of stakeholder would include employees, suppliers, customers, financial institutions, and local communities where the corporation does its business. But in either case, the claims on corporate conscience are considerably greater than the imperatives of maximizing financial return to stockholders. Today, a handful of researchers have gone as far as arguing that, the reasons for corporate restructuring or change are either competitive pressures, changing outside environments which in most cases is made up of mostly the stakeholders (Anderson et al. 2001). In the changing company environment, researchers have even gone as commending stakeholder approach as a key factor of organisational survival and success. Therefore, our caution to organisation management is that, they should skillfully consider how to treat particular groups of stakeholders and how to communicate with them responsively, being aware of the consequences of an omission or mistreatment. Having said this, this paper seeks to identify and analyse the issue of power and interests of stakeholder groups for the University of Central Lancashire (UCLAN). In the section that follows, using the stakeholder theory and framework I will analyse the interest and power of the various stakeholders on the activities of the University of Central Lancashire. Stakeholder Theory Friedman (1963) as sited in Anderson et al. (2005) argues that a corporation is socially responsible only to its shareholders. In this regard, other corporate constituencies (stakeholders) can easily be overlooked. However, stakeholder theory strongly suggests that overlooking these other stakeholders is unwise and ethically unjustified. To this extent, stakeholder theory participates in a broader debate about business and ethics (Algas et al. 2006, Donaldson & Preston 1995) Descriptively, some research on stakeholder theory assumes that managers who wish to maximize their firm's potential will take broader stakeholder interests into account. This gives rise to a number of studies on how managers, firms, and stakeholders do in fact interact (Friedman 1970, Steiner & Steiner 1997).Stakeholder theory has been articulated in a number of ways, but in each of these ways stakeholders represent a broader constituency for corporate responsibility than stockholders (Friedman 1970, Steiner & Steiner 1997). In sharp contrast, according to stakeholder theory, managers should make decisions so as to take