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Chapter 4

MGMT 3020 Chapter Notes - Chapter 4: Corporate Social Responsibility


Department
Management
Course Code
MGMT 3020
Professor
Ruben Burga
Chapter
4

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Strategic Corporate Social Responsibility (Chandler et al.) MGMT3020 - CHAPTER 4
STAKEHOLDER THEORY
Who Is A Stakeholder?
A multi-stakeholder perspective is the ideal vehicle for CSR integration
Multiple definitions for a stakeholder:
Stakeholders in an organization are the individuals and groups who are depending on the firm
in order to achieve their personal goals and on whom the firm is depending for its existence.
Eric Rhenman (1964)
A stakeholder in an organization is (by definition) any group or individual who can affect or is
affected by the achievement of the organization’s objectives.
R. Edward Freeman (1984)
The stakeholders in a firm are individuals and constituencies that contribute, either voluntarily
or involuntarily, to its wealth-creating capacity and activities, and who are therefore its
potential beneficiaries and/or risk bearers.
Post, Preston, and Sachs (2002)
Strategic CSR is all about meeting the needs/expectations of as broad of an array of
stakeholders as is possible
Freeman’s contributions and definition of stakeholders is considered the most appropriate
A NEW STAKEHOLDER DEFINITION
While everyone can be a stakeholder, management needs more precise stakeholder targets
Stakeholder: Any entity who is affected by the organization (either voluntarily or involuntarily) and
possesses the capacity to affect the organization.
Firms must prioritize stakeholders, especially those who can act on behalf of those who are
unable to defend their own interest
o Ex. The environment is not a stakeholder, but those who represent environmental
interests are
The environment is an independent ‘party’ of sorts, but its degradation affects
all other stakeholder groups
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