Stakeholder Theory in Strategic Management

Abstract

Strategy consists in making choices and taking decisions involving an organization while being aware of the interactions between the corporation, its environment, and its existing or potential resources. Linked to corporate policy, it is an activity which requires reflection and action. As practice, it “gradually constructs ensembles of opportunities and imagines trajectories of development in a rapidly changing and partially unpredictable environment” (Desreumeaux et al. 2009). As reflection, it “renders the world comprehensible, simplifying it with a view to facilitating action” (Desreumeaux et al. 2009). As such, it is praxeological reflection because it seeks efficacy and efficiency (yields and the relationship between assets and results) (Martinet et al. 1990). From the outset, stakeholder theory has cast itself as a practical and useful theory associated with strategy, as is demonstrated by both the oldest and most recent publications on the subject, those of Freeman and his co-authors: Stakeholder Theory, written by Phillipps and Freeman (2010); Stakeholder Theory: A State of the Art, coordinated by Freeman et al. (2010); The Handbook of Strategic Management, edited by Hitt et al. (2001); Strategic Management: A Stakeholder Approach (1984); “Manager les parties prenantes” (1982); and Manager pour les parties prenantes: survie, reputation et succes (2007). To this list can be added the recent book by Wicks, Freeman and Werhane: Business Ethics: A Managerial Approach (2009). For the advocates of the theory, the managerial or strategic management approach encompasses planning, systems theory, corporate social responsibility, and organization theory.