stakeholder theory

STAKEHOLDER THEORY PROFIT MAKING AND ETHICS

GROUP MEMBERS

• Arya Rajeev 7705

• Pratik Botra 7715

• Ajinkya Dingankar 7725

• Jagruti Godambe 7735

• Shivraj kakade 7745

• Riddhi Lakhani 7755

FLOW OF PRESENTATION

• Introduction to stakeholder theory

• Internal stakeholders

• External stakeholders

INTRODUCTION TO STAKEHOLDER THEORY

STAKEHOLDER THEORY

DEFINITION:

Stakeholder theory is a

“ A conceptual framework of business ethics and organizational management which addresses moral and ethical values in the management of a business or other organization. ”

Corporations are not simply managed in the interests of their shareholders alone, but that there are a whole range of stakeholders.

It identifies and models the groups, which are stakeholders of a corporation and both describes and recommends various methods to satisfy them.

Ethical organization recognizes its responsibilities towards all stakeholders.

There are two types of stakeholders :

INTERNAL STAKEHOLDERS. EXTERNAL STAKEHOLDERS.

stakeholdersinternal

ShareholdersEmployees

management

CustomersSuppliersCreditors

CompetitorsGovernment

society

INTERNAL STAKEHOLDERS

RESPONSIBILITY TOWARDS OWNERS/SHAREHOLDERS

1. Proper use of capital

2. To manage business effectively

3. To provide accurate and timely information

4. Ensure growth and appreciation of owner’s capital

5. Provide regular and fair return on owners capital

RESPONSIBILITY TOWARDS EMPLOYEES

• Fair compensation for service provided

• Timely and regular payments

• Provision of proper working and welfare conditions

• Job security

• Provision of security benefits and better living conditions

• Training and development opportunities

• To recognize and honor individual worker’s right

• Fair and unbiased treatment to all

RESPONSIBILITY TOWARDS MANAGEMENT

•Management decisions have impact

•Shareholder’s expects higher returns

•Management has a fine balance

EXTERNAL STAKEHOLDERS

RESPONSIBILITY TOWARDS CUSTOMERS (Mitsubishi Electric’s)

• Ensuring consistent quality

• Providing ease-to-use products

• Increasing customer satisfaction

• Responding to product-related issues

Responsibilities towards

Suppliers

RESPONSIBILITIES TOWARDS SUPPLIERS

• Giving regular orders

• Dealing with suppliers on fair terms and conditions

• Availing reasonable terms of credit

• Timely payment of dues

• Helping suppliers in improving or upgrading the quality

Responsibilities taken up by Casio Worldwide towards its Vendors• Casio has established Procurement

Policies in order to execute its social responsibility to conduct fair and equitable transactions throughout the supply chain. The policies cover matters including legal compliance, respecting human rights, labor, safety, and health, as well as environmental protection such as biodiversity preservation and risk control of chemical contents and information security

Casio strives to achieve the following• Fair & equitable transactions

• Compliance with laws and social norms

• Environment Protection

• Strengthening partnerships with suppliers

• Policies of Supplier selection & transaction continuation

• Securing right place & quality

• Prohibition of personal-interest relationships

Responsibilities towards

Investors/Creditors

RESPONSIBILITIES TOWARDS INVESTORS/CREDITORS

• To provide fair returns on capital invested

• To supply complete and accurate information

• To ensure that the value of investment doesn’t fall in the long term

• To raise public image of the company

• To improve prestige of the company

RESPONSIBILITIES TOWARDS INVESTORS/CREDITORS

• To undertake R&D activities for diversification

• To build up financial stability and ensure safety of investment

• To ensure timely payment of interests and principal

• To not participate in unethical practices and bring disrepute to the company

Responsibilities towards

competitors

RESPONSIBILITIES TOWARDS COMPETITORS

• Not to claim exceptionally high commissions to agents and distributors

• Not to offer too high discounts to the consumers

• Not to defame competitors directly or indirectly

Responsibility towards society and government

RESPONSIBILITIES TOWARDS SOCIETY

• Business morality

• Development of backward areas

• Efficient use of resources

• Financial assistance

• Protection of environment

MILK ADULTERATION

MARUTI SUZUKI

RESPONSIBILITIES TOWARDS GOVERNMENT

• Payment of taxes

• Obeying rules and regulations

• Giving suggestions

• Financial help during emergency

• Earn foreign exchange

HELP TO UTTARAKHAND FLOOD VICTIMS

Profit Making-An Objective with Ethical DimensionProfit making and Ethics is very hard to

be distinguished.

Unitarian View-Morality & Ethics are related to business

Separatist View-Business should concentrate on profits and ethics & business doesn’t form a part of it.

Integration View-Ethical Behaviour and Business Integrated

Consumers are becoming more and more aware of the unethical practices of the orgainzation

You can't make a profit without customers, and customers won't use your business if you outrage them too much.

 BodyShop was one of the first businesses to build on this trend.

Most immoral business practices are actively illegal, at least in Europe and North America

SOME OF WORLD’S ETHICAL PROFIT MAKING ORGANIZATIONS

CONCLUSION

Thus , ethical organization is the one that recognizes its responsibilities towards all stakeholders and considers their interest when taking decisions.

Webliography• http://www.forbes.com/sites/jacquelynsmi

th/2013/03/06/the-worlds-most-ethical-companies-in-2013/

• www.managementparadise.com

• www.moneycontrol.com

• http://essayinfo.com/sample/essay/884/16/

• www.wisegeek.org/what-is-cwww.

Thank you