The article in the url link below reports a recent academic study that debates the relative advantages of a shareholder versus stakeholder perspective on firm ownership (Issues: Stakeholder Relations, p138):
“Although the study finds much to like about stakeholder-oriented companies, it does unearth one downside: Consumers can be harmed by the higher prices charged by stakeholder firms. Higher prices enable these firms to put into practice the often-costly governance structures that benefit people other than stockholders.”
While not providing any surprises in terms of the different cultural expectations placed on managers in different countries:
“… one survey of managers in various countries has shown just how divergent opinion can be on the question of "whose company is it?" In Japan, 97% of those surveyed said a company exists for all stakeholders, compared with 83% in Germany, 78% in France, 76% in the United States and 71% in the United Kingdom. … Specifically, only 3% of Japanese managers said companies should maintain dividend payments to stockholders even if it means the company has to lay off workers, compared with 41% in Germany, 40% in France, and 89% in both the United States and the United Kingdom.”
The article does highlight some results that are not taken-for-granted within the business community:
“People tend to think about the governance issue "in terms of workers versus owners, although there is more to it than that. It's usually believed that if a company is earning ever-higher profits and is generally doing better, its workers are somehow worse off. But that is not the case. Often, when it comes to stakeholder-oriented firms, both the company and workers can do better simultaneously. But consumers are worse off, so not everyone benefits."”
Take care
Dave
Bill Werther & David Chandler
Strategic Corporate Social Responsibility
© Sage Publications, 2006
http://www.sagepub.com/Werther
'Whose Company Is It?' New Insights into the Debate over Shareholders vs. Stakeholders
Published: October 17, 2007 in Knowledge@Wharton
It is perhaps the core question in the ongoing debate over corporate governance: Does the corporation exist for the benefit of shareholders, or does it have other, equally important stakeholders, such as employees, customers and suppliers? A new study by Wharton finance professor Franklin Allen and two colleagues does not claim to provide a definitive answer, but it does show the various benefits of the stakeholder approach. It also demonstrates that the issue is not as settled as some researchers and business people in the United States, United Kingdom and other shareholder-oriented nations might think.
http://knowledge.wharton.upenn.edu/article/1826.cfm
