Stakeholder theory concerns the central idea that stakeholders in general should be the focus of organizations for value maximization, rather than only shareholders (investors), who are concerned with profit maximization. Stakeholder theory is useful for understanding organizational life because it helps illustrate and explain organizations’ features and behaviors. It is known as a managerial tool that helps evaluate the achievement of business goals by assessing managers’ behaviors. It also provides meaning and value because it offers a set of ethical guidelines that managers can follow for managing stakeholders, their expectations, and their needs. This entry first illustrates the main features, principles, and development of stakeholder theory. It then describes the main criticisms of the theory, and finally, it explores managerial implications for communication professionals who ...

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