A Response to “The Social Responsibility of Corporate Management: A Classical Critique”

Frederick R. Post (University of Toledo)

American Journal of Business

ISSN: 1935-5181

Publication date: 22 April 2003

Abstract

The preceding article, “The Social Responsibility of Corporate Management: A Classical Critique,” argues that the Shareholder Theory, which the authors refer to as the “Friedman Paradigm” represents the only intellectually and ethically meritorious model for assessing corporate social responsibility. This response argues that the 19th Century Shareholder Theory is based upon numerous factual and legal inaccuracies and fictions when evaluated in the context of the modern era. Requiring that management serve only the interests of the shareholders is morally untenable. The authors’ assertion that the competing theory, The Stakeholder Theory, is unworkable is based upon both a misunderstanding and misinterpretation of the theory. Refinements and clarifications about who qualifies as a stakeholder make the Stakeholder Theory both workable and a very useful way to improve corporate governance. Now is the time to apply the Stakeholder Theory as part of the ongoing process of improving the moral and social responsibility of corporation management.

Keywords

Citation

Post, F. (2003), "A Response to “The Social Responsibility of Corporate Management: A Classical Critique”", American Journal of Business, Vol. 18 No. 1, pp. 25-36. https://doi.org/10.1108/19355181200300002

Download as .RIS

Publisher

:

MCB UP Ltd

Copyright © 2003, MCB UP Limited

Please note you might not have access to this content

You may be able to access this content by login via Shibboleth, Open Athens or with your Emerald account.
If you would like to contact us about accessing this content, click the button and fill out the form.
To rent this content from Deepdyve, please click the button.