Stewardship and Governance: Key Theories, Contributions, and Relationship to Effective Governance

STEWARDSHIP AND
GOVERNANCE

Table of Contents
INTRODUCTION...........................................................................................................................1
KEY THEORIES OF GOVERNANCE..........................................................................................1
Overview................................................................................................................................1
Agency Theory.......................................................................................................................1
Resource Dependency Theory................................................................................................3
Stakeholder Theory................................................................................................................4
CONTRIBUTIONS OF STEWARDSHIP THEORY.....................................................................5
Customer Engagement............................................................................................................5
Employee Empowerment.......................................................................................................6
Working Environment............................................................................................................6
RELATIONSHIP OF LEADER'S VALUES AND BELIEFS TO EFFECTIVE GOVERNANCE
..........................................................................................................................................................6
Ethical Hiring.........................................................................................................................7
Sustainability..........................................................................................................................7
Inclusive Leadership...............................................................................................................7
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Stewardship refers to an appropriate procedure which leaders and managers of a company
implement in context of taking care of business practices in such a way which helps them ensure
sustainability in the structure and culture, along with responsibly fostering the organisation in an
effective and productive manner. On the other hand, Governance refers to the practices adopted
by an organisation to appropriately and effectively ensure transparency, fairness and
accountability within all the operations and functions of a firm (Oetzel and et. al., 2015). In this
relation, the report below is based on Woolworths, which is one of the most recognised and
preferred retail and supermarket chains within the UK. The assignment covers a detailed
discussion of key theories that are associated with governance that have contributed towards
achieving effectiveness within the organisation. Furthermore, the report includes contribution of
Stewardship Theory to effective governance within the firm. In addition, a detailed discussion
associated with relationship of values and beliefs of leaders to effective governance within the
organisation is also included within the report.
KEY THEORIES OF GOVERNANCE
Overview
Corporate Governance is the practice that is necessary for each and every organisation to
follow in today’s world where there is a high level of awareness amongst customers,
communities and individuals associated with an organisation. In addition to this, it allows a
company to maintain an appropriate culture which contributes in an essential manner towards the
people associated with the company, as well as society (Fitzpatrick, 2014).
Woolworths is a multinational organisation which deals in several retail offerings and has
a wide product portfolio as well as a big management team which handles the operations of the
company. Its corporate governance could hence be reflected by several theories which contribute
in relation to enhancing the effectiveness of the firm in relation to implementing and embedding
governance within its structure and culture. Therefore, in this context, the key theories of
governance are explained below:
Agency Theory
One of the most prominent theories associated with Corporate Governance is Agency
Theory. This theory appropriately defines relationship between several principals related to the
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