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BUS320 Business, Governance and Society

15 Pages4617 Words129 Views
   

University of the Sunshine Coast Queensland Australia

   

Advanced Human Resource Perspectives (BUS320)

   

Added on  2020-05-04

BUS320 Business, Governance and Society

   

University of the Sunshine Coast Queensland Australia

   

Advanced Human Resource Perspectives (BUS320)

   Added on 2020-05-04

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Running head: SHAREHOLDER AND STAKEHOLDER THEORY0Corporate Governanceand Social Responsibility
BUS320 Business, Governance and Society_1
SHAREHOLDER AND STAKEHOLDER THEORY1Executive SummaryThe purpose of this report is to analyse various theories provided by different expertsregarding shareholder and stakeholder approach. The purpose of this report is to analyse thevalue and impact of each theory in a corporation. A shareholder primacy theory focuses onmaximising the value of company’s stock to increase the worth of shareholders in the market.The stakeholder approach focus on improvising the value of each stakeholder in anorganization. Milton Friedman has written a paper on the importance of shareholder primacytheory and its role in the enhancement of company’s profit. R. Edward Freeman provided adifferent view it his report which emphasis on the importance of stakeholders approach in themodern world and its positive impact on firms growth. After analysing various moral theoriesand experts opinions, it can be provided that stakeholder approach is more beneficial for acompany. A company is considered as a corporate citizen, and it has duties towards variousstakeholders, such responsibilities are necessary to be fulfilled by the corporation. Thestakeholder approach also benefits the company by enhancing the revenues of a firm andimproving their goodwill in the industry. Below are few suggestions for implementation ofstakeholder policy:Before implementing a stakeholder theory, management is required to analyse theirbusiness structure and different stakeholder’s requirements. The theory must cover all the aspects of a company and must also focus on profitmaximisation. The stakeholder strategy should assist company is fulfilling their stakeholder'srequirements and maximising their revenues.
BUS320 Business, Governance and Society_2
SHAREHOLDER AND STAKEHOLDER THEORY2Table of ContentsIntroduction................................................................................................................................3Purpose.......................................................................................................................................4Scope..........................................................................................................................................4Literature Review.......................................................................................................................5Benefits of Adopting a Broader View........................................................................................7Theories of Justice and Normative Morality..............................................................................8Few Other Theories....................................................................................................................9Conclusion and Recommendations..........................................................................................11References................................................................................................................................12
BUS320 Business, Governance and Society_3
SHAREHOLDER AND STAKEHOLDER THEORY3IntroductionIn recent years, the role of corporate social responsibility has grown significantly in betweencompanies; many organisations have adopted corporate social responsibility structure whichfocuses on the interest of various stakeholders. Traditionally it was considered that acompany has a duty towards its shareholder to increase their value, the directors placeshareholders interest on top of everything in business. Due to globalisation and developmentof industries, companies started adopting corporate social responsibility principles whichprovide that a firm has duties towards its stakeholders. The stakeholder’s theory provides thata managers’ role is to balance the shareholder’s monetary interest against other stakeholder’sinterest; a corporation’s stakeholders include employees, local community, consumers andmuch more. Many experts believe that stakeholders’ theory is detrimental to a corporation’sgrowth. If a company focus on the interest of its stakeholders, then it cannot achieve itsorganisational objectives, which include expansion of business and enhancing shareholdersvalue in the market. Many experts have claimed that by focusing on increasing the value ofshareholders inevitably fulfills other stakeholders’ interest as well. The report will evaluateopinions of various experts to understand the role of shareholder primacy and stakeholdersapproach in a company.
BUS320 Business, Governance and Society_4

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