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Every company exists in a network of relationships with social actors that affect and are affected by the company's efforts to achieve its objectives. Taken together, these actors are the company's stakeholders, implying that they hold a stake in its conduct. Typically, stakeholders of a for-profit company include its customers, employees, stockholders, suppliers, the local community, and many others groups.

Stakeholder theory is the term used to describe broadly the systematic study of these relationships, their origins, and their implications for how companies behave. As used in this context, the word theory raises serious problems. Social scientists who study stakeholder relations are interested in many empirical questions, such as why companies and stakeholders behave as they do and why companies succeed or fail. They use the ...

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