Stakeholder Theory: People at the Center of Business

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Stakeholder Theory: People at the Center of Business

Introduction

R. Edward Freeman's stakeholder theory is a humanistic response to impersonal management. It places people, not profit, at the center of business decisions. Instead of abstract categories, it focuses on real individuals and their needs. This article explains its key assumptions, analytical tools, and philosophical roots, demonstrating how it humanizes contemporary capitalism.

Stakeholder Theory: People at the Heart of Business

The theory's foundation is the premise that behind labels like "customers" or "employees," one should see concrete individuals. Freeman calls this the "names and faces" approach. This means that each stakeholder group is internally diverse, and behind every role stands an individual with a unique biography, motivations, and aspirations. Management ceases to be an operation based on averaged metrics and instead becomes about building relationships.

This approach radically rejects the homo oeconomicus model – the vision of humans as beings driven solely by cold calculation. Freeman argues that people are capable of cooperation and seek meaning and recognition in their work. Business is therefore not merely a mechanism for utility maximization, but a community where values and relationships are created.

Stakeholder Analysis: Stake and Power Are Decisive

The key dimensions of analysis are "stake" and "power". Stake is not limited to the financial aspect. It also includes market relationships (customers, suppliers) and symbolic influences (media, social organizations). Power, in turn, is a stakeholder's ability to influence a company's actions, which depends on context rather than a fixed position in the hierarchy.

This model allows for the deconstruction of conflicts. Instead of a binary "us versus them" logic, the analysis compels mapping a network of diverse interests. This reveals non-obvious areas of cooperation, where one party's gain does not necessarily mean another's loss. It enables building lasting foundations for collaboration instead of merely temporarily mitigating disputes.

From Philosophy to Practice: Roots and Future of the Theory

The theory draws from many sources. Pragmatism provides the idea that the goal is to create better narratives of cooperation. Kantian ethics imposes the principle of treating everyone as an end, never merely as a means. Feminist and psychoanalytic inspirations raise awareness of marginalized voices and defense mechanisms within organizations. In practice, the manager becomes a "poet" who uses narrative and dialogue to build a community of meaning.

Today, Freeman's theory is a cornerstone of corporate governance and CSR. Despite criticism regarding a lack of precision, its strength lies in its flexibility, which promotes dialogue. It represents a project for the humanization of capitalism, confronting even future challenges, such as the status of artificial general intelligence (AGI) as a potential stakeholder. This compels a redefinition of the boundaries of moral subjectivity in business.

Conclusion

In a world dominated by algorithms and the pursuit of efficiency, stakeholder theory paradoxically becomes even more relevant. It reminds us that true value is created by people, their stories, and their aspirations. Perhaps it is precisely the care for all those affected by a company's operations that is the key to lasting and sustainable success, one that will withstand the test of time and technology.

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Frequently Asked Questions

What is R. Edward Freeman's Stakeholder Theory and what is its main idea?
It is a humanistic management concept that reverses the traditional perspective, placing the individual with their dignity, aspirations and uniqueness at the center of all business and economic practices, instead of impersonal categories.
What are the key dimensions of stakeholder analysis according to Freeman?
The key dimensions are 'stake', i.e. the various interests and claims on the organisation that go beyond financial aspects, and 'power', i.e. the stakeholder's ability to influence its activities.
What is the 'names and faces approach' in the context of management?
This is a postulate that behind generic labels such as 'government', 'customers' or 'community' we should see specific people and institutions with their individual experiences, motivations and unique biographies, instead of treating them as homogeneous blocks.
What philosophical traditions influenced the development of Stakeholder Theory?
The theory draws inspiration from American pragmatism (Rorty, Dewey), Kantian ethics (treating man as an end, never just a means), criticism of positivism (fact-value dichotomy) and feminist and psychoanalytic trends.
How does stakeholder theory approach conflict in organizations?
Rather than reducing conflicts to the binary logic of 'us versus them,' the theory deconstructs them, identifying the web of diverse interests and mapping subtle power dynamics to uncover non-obvious areas of cooperation and create strategies in which winning does not mean losing.
What are the practical benefits of applying Stakeholder Theory in management?
It enables the humanization of business, a shift away from the reductionist image of relationships, building lasting foundations for mutual trust and cooperation, creating 'poetic organizations' and avoiding 'ethical failures' resulting from neurotic defense mechanisms.

Related Questions

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