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Darshan Thaker (1021213) Rahul Sinha (1021226) Rohit Dhannawat (1021229) Arpita Srivastava (1021239)
We exist to create value for our share owners on a long term basis by building a business that enhances the Coca-Cola companys trademark. This is also our ultimate commitment.
Our task is to build upon our tradition of quality and value and to provide brands, products, financial results and management performance that meet the interest of our shareholders.
HISTORY
In the feudal age and continuing for centuries, kings owned most property in the kingdom. The first corporations, such as the British East India Company, were broadly chartered by powerful nobility to achieve wealth by trading, taking slaves and war booty, and stripping the resource wealth of colonies and weak countries. In the industrial and modern age, laws were passed to curb the feudal excesses of companies and their benefactors. The legal form of corporations evolved to the present shareholder model. The stakeholder model requires that all of the parties affected by management decisions, in addition to the shareholders themselves, management, employees, customers, suppliers, communities in which the company operates and the environment from local to global, all must be considered as fairly and justly as possible.
Copyright Wondershare Software
Transparency: Full disclosure of financial and nonfinancial information Accountability: Ensuring that management is effectively overseen (and, where necessary, replaced) by appointing an independent and competent governing body. Fairness: Equitable treatment of investor Responsibility: Ensuring the corporation fulfils its proper role in society.
Owners / Shareholders
Their stake:
Their expectation:
some ROI
Their stake:
Their expectation:
Their stake:
Their expectations:
Their stake:
Their expectations:
Their stake:
Their expectations:
Safety, Better relation with top management, Improved working conditions, Fair wages
Pressures on Business Competitive pressures Modern business faces greater competitive pressure: More open markets Globalisation Shareholders seeking ever higher profits
Pressures on Business
Pressure of responsibility Growing importance to consumers of ethical business:
Total UK sales of Fair Trade products grew in 2004 by more than 50% to 140 million.
Environmental legislation
In the last few years it has been proven that it is possible to treat employees, customers, suppliers, communities, and natural environment well better than most companies are now doing, and at the same time both make a good profit and produce products which themselves help assure sustainable development
Take a wide view of why the firm exists Recognise range of interest groups Form partnerships with wide range of groups
Whats Different About This? Firms used to aim for maximum profits to keep shareholders happy
This was often against interests of groups outside organisation Now, interdependence seen as vital Partnerships with all interest groups
Copyright Wondershare Software
What Does This Mean? Difficult to balance the different short term demands of shareholders and stakeholders Firms can benefit considerably from cooperating with stakeholder groups Their needs can be built into the firms decision making processes
Benefits Firms Can Expect Better public relations More favourable reporting of firms activities in media Quality relationships with suppliers Lower staff turnover
CRITIQUE
Criticism of the stakeholder model: It is not a realistic assessment of the power relationships between the corporation and other entities. There is no single, clear, and objective measure to evaluate the combined ethical/economic performance of a firm.
Advocacy for the stakeholder model: A corporation that embraces stakeholders performs better. It is the ethical way to manage because stakeholders have moral rights that grow from the way powerful corporations affect them.
Sources!
instructional1.calstatela.edu - /prosent/MGMT 308/ http://www.oecd.org/dataoecd/5/41/1930657.pdf http://www.alanfkay.com/successes/stakeholder_model.shtml http://www.bized.co.uk/educators/1619/business/external/presentation/stakeholdermodel.ppt
Business, Government and Society Steiner and Steiner McGraw-Hill Irwin, 12th Edition, Page: 15-17