Skip to content

ACCA Strategic Professional · Strategic Business Leader · Stakeholder analysis and organisational social responsibility

Lumen Retail's directors disagree: one says the company's only duty is to maximise shareholder returns within the law; another says it owes obligations to employees and communities affected by its actions. The second view is best described as which perspective?

The second director's view reflects stakeholder theory, which says an organisation has responsibilities to all groups affected by its activities, including employees and communities, not only shareholders. The first director's position is the classical shareholder view associated with Friedman.

  1. AStakeholder theoryCorrect
  2. BAgency theory in its narrow form
  3. CClassical (Friedman) shareholder view
  4. DPure philanthropy

Explanation

Stakeholder theory holds that a company has obligations to all groups affected by its actions, not only shareholders. The first director expresses the classical shareholder view. Philanthropy is voluntary giving, not an obligation framework.

Did you get it right without looking?

One question tells you little. A timed set on Stakeholder analysis and organisational social responsibility shows your real accuracy, how long you take and where you lose marks.

Practise Stakeholder analysis and organisational social responsibilityFree diagnostic mock

More Stakeholder analysis and organisational social responsibility questions