The Idea of a Stakeholder in Business Ethics and Morality - Essay Example

? Management s Management Question One The idea of a stakeholder in business ethics and morality has evolved to be one of the outstanding contributions and debate in the business cycles. Since the establishment of this concept concerning the place of a shareholder in a given organization, a concern for the interests of the entire shareholder groups has become broadly acknowledged feature , if not a demanding feature, of ethical management. The stakeholders need to be taken by the management as the principal assets of the organization. Therefore, managers in making decisions need to involve and take into account the interest of all the stakeholders in a given organization. The stakeholders of a given organization in most cases are taken to include the community, employees, suppliers and customers as well the potential investors and shareholders (Cots 2011). Hence, the responsibility of managers in a company is to serve the interests of all its stakeholders, which in most instances is called “stakeholder management”, which is commonly negated with the principle form of corporate governance, whereby the stakeholder interests are principal. Therefore, it is within the ethics of management to treat the interests of the stakeholders equally without favoring a given stakeholder. This implies that the stakeholder management has the ethical responsibility of serving all the interest of the stakeholders present for-profit corporations, which will not conflict with the present system of corporate governance (Parmar, B.L. et al. 2010). The stakeholder management must assume that management decision-making is the primary means by which the benefits of corporate wealth creation are given to the stakeholders , however , these accrued benefits might be also be obtained by other categories that interact with the corporation in many other ways, which in most cases is through the market (Cots 2011). As a result, it will be worth mentioning that management will unethically be acting by failing to serve the interests of the organization’s stakeholders who are involved in day-to-day creation of wealth. In addition, stakeholder management in an organization is right; nevertheless, to put emphasis on the moral/ethical aspect that every stakeholder group must benefit from corporate activity is paramount. This also makes managers to be aware of their moral responsibility to develop wealth that will eventually benefit all the stakeholders groups Question Two The idea of authenticity has become primary aspect in management among the large organizations that need to promote workplace conditions significantly. I believe am an authentic leader because, authentic leadership entails leaders creating opportunities and strategies that will promote a common good for all the members of the organization. This means that as an authentic leader am able to inspire all the company’s stakeholders by serving their interests as well as that of the company. Since am an authentic leader I have transformed my organization to greater heights of success (Cots 2011). By employing my authentic leadership standards and principles to the element of diversity work, as a leader I have been able to acquire understanding and support for the work, find out the conflict between organizational and individual behaviors and principles, which serve as barriers, and create significant relationships for organizational growth – all planned to intensify responsiveness and understanding and responsiveness for the value diversity has on organizational existence (Parmar, B.L. et al. 2010). Being an authentic leader, who can dig beneath the surface by discovering my purpose, principles, morals, and how I build relationships, has enabled me to lay a foundation for a greater obligation to organizational growth. That is so since attention is paid to values, purpose, and relationships, how we reason regarding and acts upon, whereby these aspects will engage individuals, not only with their minds however also their hearts. Furthermore ,as one of who has embraced authentic leadership , this has allowed me to tap into the power that relationships have in developing and promoting unity , trust, and promotes for diversity work. This will ensure that the organization achieve a common good objectives and serve the interests of all the stakeholders in the organization (Cots 2011). Question Three Cots (2011) argue that density measures the level of interaction of the stakeholder network and the centrality evaluates the significance or power of a node, corporation or stakeholder, within the specified network. Therefore, the interconnection between the different stakeholders of a given organization can be used to determine the legitimacy of the aspect of the stakeholder. Stakeholder theory is a type of theory of the organizational management and business morals, which addresses values and morals in a given organization that deals with aspects of management. The theory is founded on Immanuel Kant’s philosophy that all persons must be allowed to air their views as equal partners. The stakeholder theory argues that a business must in all the times take into account the wants and needs of its suppliers, employees, owners, and clients. Despite this, the theory has the role of ensuring that the organization maximizes its profits in the business, the theory claims that the business should have the interest of the stockholders and in some instances it must sacrifice its stakeholders to benefit the company and ensure that the company survives. Therefore, this theory has the advantage in that it will ensure that the company continues with its operations. This implies that the theory takes into account the interest of the company, which is vital to continue providing for its clients. However, the theory in itself is biased if argued on the ethical perspective (Parmar, B.L. et al. 2010). This illustrates how capitalism rules in this scenario whereby the interest of the stakeholders is considered secondary and that of the company primary. Nonetheless, in this case, economic aspect triumphs over the ethical consideration of the management stakeholder that emphasizes that the managers should consider the interest of all the stakeholders. This means that the theory doesn’t acknowledge the interest of the stakeholders, which goes against the principles of stakeholder management that recognizes the interest of all the stakeholders. Consequently, stakeholder theory has emerged to be a challenge to the traditional theory of shareholder primacy, which establishes a new standpoint to the allotment of corporate primary resources and business ownership for the workers to contribute to corporate governance, which offers a strong hypothetical support; and how a all-inclusive structure to stakeholders by the theory of classification and definition is presently the center of debate (Parmar, B.L. et al. 2010). I worked in a company that applied stakeholder theory whereby during the time of rewarding its stakeholders, the company saw appropriate to use the profits to rearward only stockholders. This was against the management stakeholder’s principles that emphasize serving the interest of all the stakeholders (Cots 2011). The decision by the organization not to reward all its stakeholders was not ethical because the organization was supposed to reward all the stakeholders or not reward none at all. This emerged to be a form of capitalism because the organization only emphasized on benefiting some section of its stakeholders. This, therefore, doesn’t meet the threshold of legitimacy of the stakeholder in the business. Question Four It is noteworthy to mention that management stakeholder has played a key role in promoting the present workplace setting. Management stakeholder approach ensures that all the stakeholder’s interests are taken into consideration and that they are treated equally. This means that the stakeholder management has the ethical responsibility of serving all the interest of the stakeholders in the present for-profit corporations, which will not conflict with the present system of corporate governance. Therefore, it can be learnt that managers have the primary role of ensuring that all the stakeholders in a particular organization are treated equally without any bias. Furthermore, it can be learned that through authentic leadership, a leader will acquire understanding and support for the work, find out the conflict between organizational and individual behaviors and principles, which serve as barriers, and create significant relationships for organizational growth – all planned to intensify responsiveness and understanding and responsiveness for the value diversity has on organizational existence (Cots 2011). This will enable the leader to deal with conflict issues and ensures that the company is within the scope of its objectives. Moreover, it can be learnt that stakeholder theory is a form of organizational management and business morals, which addresses values and morals in a given organization that deals with aspects of management. It can be concluded that in the traditional thinking of the organization, the stakeholder view, the stakeholders are the owners of the firm, and the organization has a requisite fiduciary responsibility to place their needs first, to promote value for them. Nevertheless, stakeholder theory claims that there are other participants in the firm involved, which include governmental bodies, trade unions, funders, trade associations, donors, communities, suppliers, employees, political groups, and customers. In some instances even firm’s rivals are considered as stakeholders - their standing being derivative of their capability to influence the organization and its other ethically legitimate stakeholders (Cots 2011). List of References Cots, E. G., 2011, ‘Stakeholder social capital: a new approach to stakeholder theory’, Business Ethics, 20(4), pp. 328-341. Parmar, B.L. et al., 2010, ‘Stakeholder theory: the state of the art’, The Academy of Management Annals, 4 (1), pp.403-445. Read More