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Shareholders Essay

885 words - 4 pages

shareholder is simply an individual, organization, or company that legally own share(s) of stock in a joint-stock company. By owning shares of stock, a company’s shareholders collectively own the company itself and therefore have the right to vote on decisions that affect how the company is run. This usually means the shareholders as part owners will push for company actions that increase their own financial returns.
Definition: A company that uses the shareholder approach to conducting business typically views the impact of business operations on profit. In addition, the length of concern for changes in business operations is usually short-term; such as focusing on meeting quarterly or ...view middle of the document...

Definition: A company that uses the stakeholder approach to conducting business typically views the impact of business operations on a wide range of issues; including, but not limited to: profit, reputation, employees, supplies, customers, shareholders, the environment, and the communities where the company conducts business. The length of concern for changes in business operations is usually short-term and long-term; such as understanding the need to meet business objectives on a quarterly or annual basis, but also appreciating the need to focus on the impact on the company beyond just an annual time-frame.
* Stakeholder-oriented companies are primarily concerned with a company’s triple bottom line
* Whereas shareholders have a legal right to directly affect a company’s policies and actions, the other groups incorporated stakeholders can influence a company indirectly as many stakeholders have no involvement with the company in any financial or legal way.
0 In other words, not all stakeholders are equal nor entitled to the same considerations.
In a stakeholder business model, a company can address or be influenced by the needs and concerns all people, groups, and places affected by the company (including the same parties that shareholders affect investors, employees, suppliers, and customers).

Stockholder Theory
* Advocates of the stockholder theory make their case on the basis of the different functions that organizations can fulfill. Private businesses, according to this understanding, are created in order to generate wealth. They do this by seeking the maximum profits available for themselves and that can then be passed on to their shareholders. Other functions of organizations can be best fulfilled by other kinds of organizations, such as non-profits and government agencies.

Stakeholder Theory
* Advocates of the...

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