In Stakeholder Capitalism, have all Actors Found Each Other or is it a Marriage of Convenience?

Abstract

In 2019, the Davos Manifesto was declared by one hundred and eighty-one Chief Executive Officers (CEOs) attending the Business Roundtable meeting who stated that a company’s purpose is to create shared and sustained value for all stakeholders. This statement was made in response to various global challenges such as climate change, environmental degradation, wealth inequality, poverty, and disease. This study aims to explore whether shareholder and stakeholder approaches of corporate governance are moving towards convergence and whether stakeholder capitalism is tenable. This study analyzed secondary data from various sources, including journals, presentations, debates, book reviews, and discussions. It also reviewed corporate governance models in Germany, the United States of America (USA), the United Kingdom (UK), the Republic of South Africa, and Malaysia thereby exploring their proximity to stakeholder capitalism. The study revealed that in practice there is gradual merging of shareholder and stakeholder approaches. Possible benefits and challenges in the adoption of stakeholder capitalism have been identified as well as possible solutions to those challenges. Further research is necessary to confirm stakeholder capitalism as a viable alternative to shareholder-centric approaches.