R. Edward Freeman

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R. Edward Freeman
Born (1951-12-18)December 18, 1951
Columbus, Georgia, USA
Fields American Philosopher and Professor of Business Administration
Alma mater Darden School of the University of Virginia

R. Edward Freeman (born December 18, 1951) is an American philosopher and professor of business administration at the Darden School of the University of Virginia, particularly known for his work on stakeholder theory (1984) and on business works.

Biography[edit]

Born in Columbus, Georgia, Freeman received a B.A. in mathematics and philosophy from Duke University in 1973 and a Ph.D. in philosophy from Washington University in 1978.

He taught at the University of Minnesota and the Wharton School, and is now Elis and Signe Olsson Professor of Business Administration at the Darden School of the University of Virginia. He is also academic director of the Business Roundtable Institute for Corporate Ethics, and director of the Darden's Olsson Center for Applied Ethics.[1] In 1994 Freeman served as president of the Society for Business Ethics. He is one of the executive editors of the journal Philosophy of Management and he serves as the editor for the Ruffin Series in Business Ethics from Oxford University Press.

In 2001 Freeman was awarded the Pioneer Award for Lifetime Achievement by the World Resources Institute and by the Aspen Institute, and in 2005 the Virginia State Council on Higher Education honored him with the Outstanding Faculty Award.

Work[edit]

Freeman is particularly known for his work on stakeholder theory originally published in his 1984 book Strategic Management: A Stakeholder Approach. He (co)authored some more books on corporate strategy and business ethics. Also recently he co-edited standard business textbooks as The Portable MBA and the Blackwell's Handbook of Strategic Management, and His latest book, Managing for Stakeholders, was published by on October 17, 2007. Freeman also provided the chapters on stakeholder theory and stakeholder management for the world's first "Dictionary of CSR", the Institute for Corporate Culture Affairs "A to Z of Corporate Social Responsibility"

Stakeholder theory[edit]

Stakeholder theory is a theory of organizational management and business ethics that addresses morals and values in managing an organization.

According to Bill Royce, the first printed use of “stakeholders” in a business sense appeared in LRPS Report No. 168 titled “The Strategic Plan” dated April 1963.

In the preparation of that report Robert Stewart, Knight Allen, and Marion Doscher were discussing who should have influence on a corporate purpose.

Doscher defined them as “stakeholders,” to her an old Scottish term meaning those with a legitimate claim on something of value. Actually, its semantics go something like this: stakeholder is literally the holder of a wager but stake is also short for grubstake, an early U.S. Western term meaning an advance given to a prospector in expectation of a share in his finds.

It thus conveys a natural interest in an enterprise. Regardless, it caught on and was used extensively thereafter. An affirmation of its SRI origins can be found in a paper on business ethics by Johanna Kujala at www.mcb.co.uk/services/conferen/jun98/bale/kujala.html and in Igor Ansoff’s book, Corporate Strategu, McGraw-Hill 1965, p 34.

 An example is the Stakeholder Theory Conference, University of Toronto, May, 1996
 Friedman, M., The Social Responsibility of Business Is to Increase Profits, New York Times Magazine, Sep 13, 1970, pp 122–126
 As quoted in Freeman, R. Edward, Strategic Management: A Stakeholder Approach, Pitman, Boston, 1984

It was further detailed by Freeman in the book Strategic Management: A Stakeholder Approach, and identifies and models the groups which are stakeholders of a corporation, and both describes and recommends methods by which management can give due regard to the interests of those groups. In short, it attempts play to address the "Principle of Who or What Really Counts."[2]

In the traditional view of the firm, the shareholder view, the shareholders or stockholders are the owners of the company, and the firm has a binding fiduciary duty to put their needs first, to increase value for them. However, stakeholder theory argues that there are other parties involved, including governmental bodies, political groups, trade associations, trade unions, communities, financiers, suppliers, employees, and customers. Sometimes even competitors are counted as stakeholders - their status being derived from their capacity to affect the firm and its other morally legitimate stakeholders. The nature of what is a stakeholder is highly contested (Miles, 2012),[3] with hundreds of definitions existing in the academic literature (Miles, 2011).[4]

Corporate social responsibility[edit]

Corporate social responsibility (CSR),[5] is a form of corporate self-regulation integrated into a business model. CSR policy functions as a built-in, self-regulating mechanism whereby a business monitors and ensures its active compliance within the spirit of the law, ethical standards, and international norms. CSR is a process with the aim to embrace responsibility for the company's actions and encourage a positive impact through its activities on the environment, consumers, employees, communities, stakeholders and all other members of the public sphere who may also be considered as stakeholders. A preview of these concepts appear in a publication that appeared in 1968 [6] by the Italian economist Giancarlo Pallavicini, creator of the "Metodo della scomposizione dei parametri" (Method of decomposition parameters), for the calculation of the results are not directly economic business activity on ethical demands , moral, social, cultural and environmental [7] The term "corporate social responsibility" came into common use in the late 1960s and early 1970s after many multinational corporations formed the term stakeholder, meaning those on whom an organization's activities have an impact. It was used to describe corporate owners beyond shareholders as a result of an influential book by Freeman, Strategic management: a stakeholder approach in 1984.[2] Proponents argue that corporations make more long term profits by operating with a perspective, while critics argue that CSR distracts from the economic role of businesses. Others argue CSR is merely window-dressing, or an attempt to pre-empt the role of governments as a watchdog over powerful multinational corporations.

Publications[edit]

  • 1984. Strategic Management: A Stakeholder Approach
  • 1988. Corporate strategy and the search for ethics with Daniel R. Gilbert
  • 2007. Managing for Stakeholders: Survival, Reputation and Success with Jeffrey Harrison and Andrew C. Wicks. Yale University Press
  • 2009. Business ethics: a managerial approach with Andrew C. Wicks and Patricia H. Werhane
  • 2010. Stakeholder Theory: The State of the Art with Jeffrey S. Harrison, Andrew C. Wicks

References[edit]

  1. ^ Freeman's curriculum vitae. Accessed Feb 27, 2013.
  2. ^ a b Freeman, R. Edward (1984). Strategic Management: A stakeholder approach. Boston: Pitman. ISBN 0-273-01913-9. 
  3. ^ Miles, Samantha (2012). "Stakeholders: essentially contested or just confused?". Journal of Business Ethics 108 (3): 285–298. 
  4. ^ Miles, Samantha (2011). "Stakeholder Definitions: Profusion and Confusion". EIASM 1st interdisciplinary conference on stakeholder, resources and value creation, IESE Business School, University of Navarra, Barcelona. 
  5. ^ D Wood, 'Corporate Social Performance Revisited' (1991) 16(4) The Academy of Management Review
  6. ^ Giancarlo Pallavicini, "Strutture integrate nel sistema distributivo italiano" (Structures built in the Italian distribution system), Giuffré Editore, Milan, 1968, p. VIII/351
  7. ^ "Encyclopedia,Biographic Universal Treccani", 2007 Edition, Vol. 14, p. 617; "Treccani - Portal", Social Science / Economists / Biographies; Bancoper Annual Meeting, Bologna, 15.11.2008, Prefect Angelo Tranfaglia, "Profit and Social Responsibility", p. 12, "Finance and Markets", February 3, 2009, p. 11 Mara Consoli, "When ethics becomes a bargain" New Chronicles, CNEL, Rome, 12.01.2009, Adelaide Mochi, "Award Socialis and corporate social responsibility"

External links[edit]