Managing for Stakeholders Using Multiple-Criteria Decision-Making Techniques

Carlos Serrano-Cinca (), Yolanda Fuertes-Callén and Beatriz Cuellar-Fernández
Additional contact information
Carlos Serrano-Cinca: University of Zaragoza
Yolanda Fuertes-Callén: University of Zaragoza
Beatriz Cuellar-Fernández: University of Zaragoza

Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, 2021, vol. 157, issue 2, No 7, 601 pages

Abstract: Abstract Managing for shareholders means maximising the market value of a company by increasing their returns. Managing for stakeholders means simultaneously creating value for multiple parties, such as employees, government, suppliers, customers, the environment and even society as a whole, which requires a multiple-criteria decision-making approach. This paper develops social indicators to measure the value that a company has distributed to stakeholders since the foundation of the company, and then calculates its relative efficiency using data envelopment analysis (DEA). The accumulated value of the investments made by the shareholders, the subsidies received and the loans borrowed are proposed as inputs. The accumulated value of taxes paid by the company, personnel payments, interest payments to creditors, and purchases from suppliers are proposed as outputs. All values are adjusted for the time value of money at the valuation date. We chose a weighted DEA model because not all stakeholders are worth the same, obtaining the weights from the preferences of social investment experts using a multi-attribute decision-making technique. A practical case is presented, obtaining the relative efficiency of a sample of companies in creating value for five years since their foundation. We found a positive relationship between efficiency in generating value for shareholders and efficiency in generating value for some non-shareholders, although the results are sensitive to the outputs chosen. The proposed method is useful for social investors when they invest or for public administrations when they provide subsidy to entrepreneurs.

Keywords: Data envelopment analysis; Multiple criteria analysis; Stakeholder theory; Sustainability (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://link.springer.com/10.1007/s11205-021-02671-1 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:soinre:v:157:y:2021:i:2:d:10.1007_s11205-021-02671-1

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/11135

DOI: 10.1007/s11205-021-02671-1

Access Statistics for this article

Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement is currently edited by Filomena Maggino

More articles in Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().