Corporate Sustainability: Shareholder Primacy Versus Stakeholder Primacy
Corporate Sustainability: Shareholder Primacy Versus Stakeholder Primacy
English | 2021 | ISBN: 1637420862 | 77 Pages | EPUB | 0.8 MB
English | 2021 | ISBN: 1637420862 | 77 Pages | EPUB | 0.8 MB
Public companies have traditionally operated under the corporate model of “shareholder primacy” with the primary purpose of generating returns for shareholders and thus corporate activities are managed toward creating shareholder value. The stakeholder primacy system encourages directors and executives to focus on managing corporate activities toward creating shared value for all stakeholders. The role of the board of directors under stakeholder primacy/capitalism as opposed to shareholder primacy/capitalism is to oversee the managerial function of focusing on the long-term sustainability performance, effectively communicating sustainability performance information to all stakeholders.