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    Stakeholder theory is more accommodating of prosocial act... — Carmelics
    Home/Consequentialism
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    Stakeholder theory is more accommodating of prosocial activity by firms than shareholder primacy

    Consequentialism
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    1 reason for
    2 reasons against

    Reasons For

    1 perspective
    Reason for
    ?
    • 1.Stakeholder theory permits firms to pursue goals other than increasing shareholder wealth
      ?

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    • 2.Prosocial activities are goals other than increasing shareholder wealth
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    Reasons Against

    2 perspectives
    Reason against 1 of 2
    ?
    • 1.Shareholder primacy, as defended by Milton Friedman, already permits prosocial activity when it serves long-run profit maximization.
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    • 2.Most prosocial activities by firms—reputation, employee morale, community goodwill—are instrumentally justified under shareholder primacy.
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    • 3.If shareholder primacy accommodates prosocial activity instrumentally, the difference between the two theories is narrower than the claim implies.
      ?

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    Reason against 2 of 2
    ?
    • 1.Stakeholder theory, by distributing fiduciary obligations across multiple constituencies, creates irresolvable conflicts that can paralyze prosocial decision-making.
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    • 2.R. Edward Freeman acknowledges no canonical priority rule among stakeholders, leaving managers without principled grounds for allocating prosocial resources.
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    • 3.A theory that cannot guide action in cases of stakeholder conflict is not more accommodating of prosocial activity but merely more permissive of managerial discretion.
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    Topics

    ConsequentialismDemocracy & Governance

    Related

    A theory that cannot guide action in cases of stakeholder conflict is not more a...If shareholder primacy accommodates prosocial activity instrumentally, the diffe...Most prosocial activities by firms—reputation, employee morale, community goodwi...Prosocial activities are goals other than increasing shareholder wealth
    +4 moreShow less
    R. Edward Freeman acknowledges no canonical priority rule among stakeholders, le...Shareholder primacy, as defended by Milton Friedman, already permits prosocial a...Stakeholder theory permits firms to pursue goals other than increasing sharehold...Stakeholder theory, by distributing fiduciary obligations across multiple consti...

    Similar

    Stakeholder theory permits firms to pursue goals other than increasing...81%A theory that mandates a single objective for all firms fails to respe...75%The consequentialist argument for shareholder primacy is flawed becaus...73%An act-consequentialist counterpart theory that revises some pre-theor...73%

    Source

    AI-extracted1/3 agreementValid
    SEP: ethics-business
    View source passageHide passage
    Many writers connect the debate about CSR with the debate about the ends of corporate governance. Thus Friedman (1970) objects to CSR, saying that managers should be maximizing shareholder wealth instead. (Friedman also thinks that CSR is a usurpation of the democratic process and often wasteful, since managers aren’t experts in solving social problems.) Stakeholder theory (Freeman et al. 2010) is thought to be more accommodating of prosocial activity by firms, since it permits firms to do thing
    Extraction notes

    Validity: Extracted via Max plan + API grounding/validity checks

    Details

    Type
    claim
    Perspectives
    3 (1 for, 2 against)
    Edits
    1 edit