Pick One Of The Following Terms For Your Research: St 746917 ✓ Solved

Pick one of the following terms for your research: Stakehold

Pick one of the following terms for your research: Stakeholder, corporate citizenship, reputation, corporate governance, or executive compensation. Paper should be written in the following format: DEFINITION: a brief definition of the key term followed by the APA reference for the term; this does not count in the word requirement. SUMMARY: Summarize the article in your own words — this should be in the 250–300 word range. Be sure to note the article's author, note their credentials and why we should put any weight behind his/her opinions, research or findings regarding the key term. DISCUSSION: Using 300–400 words, write a brief discussion, in your own words, of how the article relates to the selected chapter Key Term. A discussion is not rehashing what was already stated in the article, but the opportunity for you to add value by sharing your experiences, thoughts and opinions. This is the most important part of the assignment. REFERENCES: All references must be listed at the bottom of the submission in APA format. Be sure to use the headers in your paper. Provide a plagiarism report.

Paper For Above Instructions

Chosen Term

Stakeholder

DEFINITION

Definition (brief): A stakeholder is any individual or group that can affect, or is affected by, the achievement of an organization’s objectives; stakeholders include employees, customers, suppliers, communities, investors, and others who have a stake in corporate actions (Freeman, 1984).

APA reference for definition source: Freeman, R. E. (1984). Strategic Management: A Stakeholder Approach. Pitman Publishing.

SUMMARY

This summary analyzes the seminal article "The Stakeholder Theory of the Corporation: Concepts, Evidence, and Implications" by Thomas Donaldson and Lee E. Preston (1995). Donaldson and Preston are established scholars in business ethics and management; Donaldson has held professorships and published extensively on managerial ethics and corporate governance, and Preston's work in organizational theory and strategic management is well regarded. Their combined scholarship and publication in a top-tier, peer-reviewed journal (Academy of Management Review) lend substantial credibility to their arguments (Donaldson & Preston, 1995).

The article presents a tripartite formulation of stakeholder theory: normative, instrumental, and descriptive. Normative stakeholder theory argues that stakeholders have intrinsic value and deserve consideration for ethical reasons. Descriptive stakeholder theory offers a depiction of corporate practice and managerial behavior, explaining how firms actually interact with stakeholder groups. Instrumental stakeholder theory examines the empirical relationships between stakeholder management and corporate outcomes such as financial performance and system stability. Donaldson and Preston critique earlier renditions of stakeholder theory for conflating these distinct dimensions and emphasize that normative foundations are central to the theory’s legitimacy. They also propose research directions to empirically test the instrumental claims and refine conceptual clarity. The article balances philosophical argumentation with implications for managerial practice and research, urging scholars to separate moral claims about stakeholder rights from empirical claims about firm outcomes (Donaldson & Preston, 1995).

DISCUSSION

The Donaldson and Preston (1995) article aligns closely with chapter-level discussions of the stakeholder concept by clarifying stakeholder theory’s normative basis and by separating it from descriptive and instrumental claims. In my view, the normative emphasis strengthens corporate accountability: if stakeholders possess intrinsic worth, managers cannot treat them merely as means to shareholder ends (Freeman, 1984; Mitchell et al., 1997). This perspective resonates with practical management experiences where long-term organizational resilience often depends on non-shareholder constituencies—employees who innovate, suppliers who cooperate, and communities that grant social license (Parmar et al., 2010).

Applying the article’s framework to contemporary corporate dilemmas reveals useful distinctions. For example, a firm’s environmental remediation obligations should be justified normatively (ethical duty to affected communities) rather than solely instrumentally (to avoid fines). Framing responsibilities normatively can shift strategy: firms invest proactively in stakeholder relations not just for performance gains, but because stakeholders’ rights matter (Carroll, 1991; Clarkson, 1995). Empirically, the instrumental claims that stakeholder management improves performance remain context-dependent; research shows positive links under certain governance and institutional conditions (Aguilera et al., 2007). Thus, managers should adopt stakeholder engagement as both an ethical stance and a strategic lens, calibrating actions to stakeholder salience (Mitchell et al., 1997) and to institutional incentives.

Finally, integrating stakeholder theory with corporate governance enhances board deliberations by broadening fiduciary considerations beyond shareholders to include systemic value creation and reputational capital (Freeman et al., 2007). From my practice-based perspective, stakeholder-oriented decisions often require trade-offs and judgment calls; Donaldson and Preston’s insistence on conceptual clarity helps managers articulate and justify those trade-offs to stakeholders and regulators. Overall, the article’s distinctions help reconcile ethical imperatives with pragmatic governance and provide a roadmap for research and practice to evaluate stakeholder-focused strategies.

Plagiarism Report

Plagiarism statement: This paper was drafted specifically for this request. I cannot directly run institutional plagiarism detection software (e.g., Turnitin) from here. I recommend submitting this document to your institution’s preferred originality-checking tool for an official similarity report. To the best of my ability, the content above is original, synthesizes cited sources with in-text attributions (e.g., Donaldson & Preston, 1995; Freeman, 1984), and does not reproduce extended verbatim passages from source materials.

Conclusion

Stakeholder theory, as clarified by Donaldson and Preston (1995) and grounded in Freeman’s earlier work, remains a foundational framework for understanding corporate obligations beyond shareholders. Distinguishing normative, descriptive, and instrumental dimensions enables managers and scholars to align ethical commitments with strategic action. Firms that adopt stakeholder-informed governance are better positioned to manage risk, secure social legitimacy, and pursue sustainable value creation.

References

• Aguilera, R. V., Rupp, D. E., Williams, C. A., & Ganapathi, J. (2007). Putting the S back in CSR: A multilevel theory of social change in organizations. Academy of Management Review, 32(3), 836–863.
• Carroll, A. B. (1991). The pyramid of corporate social responsibility: Toward the moral management of organizational stakeholders. Business Horizons, 34(4), 39–48.
• Clarkson, M. B. E. (1995). A stakeholder framework for analyzing and evaluating corporate social performance. Academy of Management Review, 20(1), 92–117.
• Donaldson, T., & Preston, L. E. (1995). The stakeholder theory of the corporation: Concepts, evidence, and implications. Academy of Management Review, 20(1), 65–91.
• Freeman, R. E. (1984). Strategic Management: A Stakeholder Approach. Pitman Publishing.
• Freeman, R. E., Harrison, J. S., & Wicks, A. C. (2007). Managing for Stakeholders: Survival, Reputation, and Success. Yale University Press.
• Mitchell, R. K., Agle, B. R., & Wood, D. J. (1997). Toward a theory of stakeholder identification and salience. Academy of Management Review, 22(4), 853–886.
• Parmar, B. L., Freeman, R. E., Harrison, J. S., Wicks, A. C., Purnell, L., & de Colle, S. (2010). Stakeholder theory: The state of the art. Academy of Management Annals, 4(1), 403–445.
• Phillips, R. A. (2003). Stakeholder theory and organizational ethics. Berrett-Koehler Publishers.
• Jones, T. M. (1995). Instrumental stakeholder theory: A synthesis of ethics and economics. Academy of Management Review, 20(2), 404–437.