Question

after a nationwide spike in gun-related violent crime, a corporation decides to discontinue gun sales in its retail stores, even though this will probably hurt the company's sales in the next quarter. according to stakeholder theory, did the corporation fulfill its duty?

Answer 1

Stakeholder theory posits that companies have a responsibility to protect public interests, such as reducing the number of guns in their communities, so it is true that they are doing their duty.

What is Stakeholder Theory?

• Stakeholder theory is a capitalist view that emphasizes the interrelationships between a company and its customers, suppliers, employees, investors, communities, and others involved in the organization.
• As an example of how the stakeholder theory works, consider a car company that recently went public. Of course, shareholders want the stock price to rise, and the company strives to keep those shareholders happy because they invested money in the company.

Why is stakeholder theory better than shareholder theory?

Stakeholders include everything from shareholders, creditors and bondholders to employees, customers, suppliers and governments. The main difference between the two is that shareholders focus on return on investment. Stakeholders care more about company performance

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