Unfolding Stakeholder Thinking

Argues that, today, stakeholder thinking has evolved into the study of interactive, mutually engaged and responsive relationships that establish the very context of doing modern business, and create the groundwork for transparency and accountability. "The work that needs to be done in order to rescue business from the moral scrapheap is being done by the authors and editors of this volume ... The right book at the right time." R. Edward Freeman

Today's successful companies are those that recognize that they have responsibilities to stakeholders that go beyond mere compliance with the law or meeting the fiduciary responsibility inherent in maximizing returns. This book focuses on engaging stakeholders for long-term value creation.

This book – the first of a two-volume series – argues that, today, stakeholder thinking has evolved into the study of interactive, mutually engaged and responsive relationships that establish the very context of doing modern business, and create the groundwork for transparency and accountability.

This book makes it clear that in today's societies successful companies are those that recognize that they have responsibilities to a range of stakeholders that go beyond mere compliance with the law or meeting the fiduciary responsibility inherent in maximizing returns to shareholders. If in the past the focus was on enhancing shareholder value, now it is on engaging stakeholders for long-term value creation. The process of engagement creates a dynamic context of interaction, mutual respect, dialogue and change – not a one-sided "management" of stakeholders. Indeed, the authors believe the very term "stakeholder management" to be outdated and corporate-centric. Companies can manage their relationships with stakeholders, but frequently cannot actually manage the stakeholders themselves, because, as the activist and collaborative initiatives described in this volume suggest, company-stakeholder relationships are not one-way streets and different institutions bring different agendas, goals and priorities to the engagement.

There are clear implications to the way in which stakeholder thinking is unfolding today. If in the past corporate "social" responsibility was simply seen as profitability plus compliance plus philanthropy, now responsible corporate citizenship – or corporate responsibility – means companies being more aware of and understanding the societies in which they operate. Corporate responsibility means recognising that day-to-day operating practices affect stakeholders and that it is in those impacts where responsibility lies, not merely in efforts to "do good". Companies are now faced with a wide array of challenges that mean that senior executives and managers need to be able to deal with issues including greater accountability, human rights abuses, sustainability strategies, corporate governance codes, workplace ethics, stakeholder consultation and management. Stakeholder thinking needs to capture these new realities.

The global reach of multinational corporations has served to highlight the need for the (re)integration of business into society, relationships...