The Pressure of Stakeholders

Aileen Ionescu-Somers and Ulrich Steger

Chapter 4 in Business Logic for Sustainability, 2008, pp 78-111 from Palgrave Macmillan

Abstract: Abstract Although the notion of companies serving broader interests than those of stockholders or shareholders has been around since the 1930s (Coase, 1937), the term ‘stakeholder’ first formally appeared with reference to business in a 1963 internal memorandum at the Stanford Research Institute. Researchers at the Institute postulated that instead of an exclusive focus on shareholders, corporations were also responsible for a wider range of entities or interest groups ‘without whose support the corporation would cease to exist’ (Freeman, 1998, p. 602). Society can call into question the right of companies’ legitimacy to exist, that is; their ‘licence to operate’, should they not wield their power responsibly. If society grants legitimacy — and, hence, power — to business, what society giveth, society can equally take away…

Keywords: Supply Chain; Socially Responsible Investment; Business Manager; Share Price; Business Case (search for similar items in EconPapers)
Date: 2008
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-0-230-58350-4_4

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DOI: 10.1057/9780230583504_4

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