The Stakeholder Theory of the Corporation

The Stakeholder Theory of the Corporation suggests that a company should serve and balance the interests of all its stakeholders—not just shareholders. Stakeholders include employees, customers, suppliers, communities, and investors. The theory emphasizes that long-term success depends on maintaining positive relationships and fulfilling the needs of these groups. By considering the interests of everyone affected by the company's actions, businesses can foster trust, sustainability, and overall value creation, rather than focusing solely on maximizing immediate profits for shareholders.