The concept of stakeholder management - Essay Example

To address the role of stakeholders in governance analysis, the concept of stakeholder management was created. The challenge of stakeholder management, then, is to see to it that the organization's primary stakeholders achieve their objectives and that other stakeholders are dealt with ethically and are also satisfied. This is the classic "win-win" situation. It does not always occur, but it is a legitimate goal for management to pursue to protect its long-term self-interests. Management's second-best alternative is to meet the goals of its primary stakeholders, keeping in mind the important role of its owner investors.

Without economic viability, all other stakeholders' interests are lost. Thus, the important functions of stakeholder management are to describe, to understand, to analyze, and, finally, to manage. Reference:Buchholtz, A., & Carroll, A. (1999). Business and society: Ethics and stakeholder management. US: South-Western Educational