Question

Which theory (Ownership and Stakeholder) do you feel has more of an impact on the business environment? Provide an example from current events in the past 6 months that supports your position.

Answer 1

I strongly feel that Stakeholder theory has more impact on business environment than the ownership theory. Stakeholder theory is more concerned about the way the business is conducted i.e. how ethically or unethically the business is conducted, it says that the business should be conducted in such a way that there is always something in it for the people who are directly or indirectly associated and are affected by the operations of the business. As per this theory of the organization wants to have and retain a string hold on the business world then the it should take care of its employees, customers, people who are supplying raw materials etc., and should ensure value addition in their professional and personal lives i.e. stakeholders should be the primary concern.

In the times of recession in the last quarter in India, Flipkart, a large Ecommerce fir, did not fire any employee, did not raise the prices and followed the stakeholder theory and survived recession.