In his ground-breaking new textbook, Mick Fryer offers students of Business Ethics clear explanations of a range of theoretical perspectives, along with examples of how these perspectives might be used to illuminate the ethical challenges presented by business practice. The book includes:  • Realistic scenarios which gently introduce a theory and demonstrate how it can be applied to a real-life ethical dilemma that everyone can relate to, such as borrowing money from a friend  • Real organisational case studies in each chapter which illustrate how each theory can be applied to real business situations. Cases include Nike, Coca Cola, BMW, Shell, Starbucks and GSK  • ‘Pause for Reflection’ boxes and ‘Discussion Questions’ which encourage you to challenge the established notions of right and wrong, and empower you to develop your own moral code  • Video Activities in each chapter with accompanying QR codes which link to documentaries, films, debates and news items to get you thinking about real-life ethical dilemmas Visit the book’s companion website for self-test questions, additional web links and more at: study.sagepub.com/fryer

The Responsibilities of Business Executives: Just Looking after Shareholders’ Interests or Taking all Stakeholders into Account?

The Responsibilities of Business Executives: Just Looking after Shareholders’ Interests or Taking all Stakeholders into Account?

Chapter objectives

This chapter will:

  • explain how shareholder theory and normative stakeholder theory offer contrasting approaches to executive responsibilities;
  • outline Milton Friedman’s agency, free-market and usurpation arguments in support of shareholder theory;
  • describe how normative stakeholder theory differs from instrumental stakeholder theory and enlightened shareholder theory;
  • outline a stakeholder-investments argument, a respect-for-persons argument, and a reciprocity argument in support of normative stakeholder theory;
  • highlight some characteristics of shareholder theory and normative stakeholder theory rationales.

Introduction

Most companies are run in a hierarchical manner. In other words, people at the top make the key decisions concerning those companies.1 Those people are usually ...

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