Question 1 (25 points) Joseph Johnston argues, in his article, Natural Law and the Fiduciary Duties of Business Managers that…”Simply put, stakeholder theory sounds good in social theory but will not...

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Stakeholder Analysis and Corporate Social Responsibility
Table of Contents
Introduction ..................................................................................................................................... 2
Stakeholder theory sounds good in social theory but will not work in practice.” ...................... 2
Opinion ....................................................................................................................................... 3
Critique of the cost
enefit analysis and whether it leads to a “flawed ethical result.” .............. 4
Corporate sustainability .............................................................................................................. 5
Corporate Sustainability Strategies: A Siemens Case Study .................................................. 6
Companies em
ace commitments to being leaders in climate change. This case study looks at
one company's implementation of green strategies, its challenges and results. ............................. 6
There is an emergence need of corporate sustainability because NGOs, governments and
usinesses needs to adapt the operations to meet the social and global environmental challenges.
In business, Ngo’s and government sector, substantiality helps in long term and also to know the
impact of global realities in the product and services. .................................................................... 6
Edward Freeman’s model of Stakeholder Analysis .................................................................... 7
Conflict with the fiduciary duties of management and the board of directors to maximize
shareholder wealth ...................................................................................................................... 8
Hosmer Case ............................................................................................................................... 8
Conclusion ...................................................................................................................................... 9
References ..................................................................................................................................... 10
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Stakeholder Analysis and Corporate Social Responsibility
Introduction
Stakeholders are the creditors, employees and suppliers who has the personal interest
in the corporations and it is the corporate legal obligation to consider their interest
with the company’s interest so as to achieve long term benefits. Company may face
hurdle or conflicts while fulfilling the interest of shareholder and stakeholders
ecause it is difficult to consider both interest but company has to match shareholders
and stakeholder’s interest and function accordingly.
Stakeholder theory sounds good in social theory but will not work in practice.”

Corporate managers now a days faces so much pressure from two directions i.e. from
shareholders and stakeholders. Shareholders demands from the manager to pay more attention in
increasing their values. While advocates holds that the manager have legal obligations towards
stakeholders also and not just towards corporates and shareholders.
According to Joseph Johnston the corporates, managers have social responsibility towards
stakeholders. Social responsibly includes sustainable use of natural resources, environment
protection. The European countries favor Stakeholder models. Stakeholder model assert that
creditors, employees, suppliers, communities and customers, makes firm specific contribution
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Stakeholder Analysis and Corporate Social Responsibility
towards company so that directors should have responsibilities towards them. The main aim of
the corporates is to enhance the profits of corporation and to increase the shareholder value
ecause there is a saying if shareholders and stakeholders are happy than only one can earn
profits. Theoretically shareholders value model promotes efficiency, economic efficiency...