Robert Edward Freeman

Why do non-profit organizations exist? Prior research largely assumes that non-profit organizations’ primary goal is to create social value, while corporations are viewed as the sole creators of economic value. This dichotomy has overshadowed and narrowed scholarly understanding of the role that non-profit organizations can play in the value creation process. Drawing on an eight-year longitudinal case study of an Italian non-profit organization (NPO), we found that the nonprofit organization emerges as a central economic value-creating actor, not merely a beneficiary or implementer. Our findings reveal a process model in which the NPO leverages technological capabilities to create economic value for firms while simultaneously generating social value for society. At the center of this model is the concept of tech-resonance capability, which enables non-profit organizations to mitigate firms’ negative externalities through technology, thereby producing integrated economic and social outcomes. In doing so, we contribute to stakeholder theory by re-centering non-profit organizations as central actors in economic value creation, rather than as peripheral social value providers. We conclude with practical implications for how organizations can develop such capabilities to foster shared value creation.

Our current era is characterised by multiple challenges, including climate change, global health challenges, economic inequality, political instability, and technological upheavals. With these crises intersecting and compounding, the modern business environment has become a landscape of volatility and moral complexity. Organizations can no longer remain passive in the face of these mounting challenges and are called upon to embrace human-centred, ethically-driven practices that acknowledge the profound interconnectedness of their actions with society and the planet. This edited volume explores how organizations and leaders can respond to the unprecedented complexities and crises of the 21st century with ethical integrity, adaptive governance, and proactive leadership. The book integrates a multidisciplinary array of conceptual, qualitative and quantitative scholarly efforts. It includes studies of green HRM, sustainable career development, adaptive teleworking models, and AI-driven social accounting, underscoring the diverse ways in which organizations are navigating polycrisis with humanistic values and technological foresight. Together, these chapters advocate for a shift in mindset—from viewing crises as insurmountable barriers to recognizing them as catalysts for ethical growth and organizational evolution. This book is an essential resource for scholars and students of business ethics, sustainability strategy and organizational response to ‘grand challenges’. It will also be of interest to business leaders and policymakers seeking to navigate the complexities of polycrisis with ethical innovation, responsibility, and a commitment to building resilient, human-centered organizations.

For more than thirty years the writings and influence of one man in particular have dominated and directed the field of modern business ethics. We are indebted to two of his fellow‐Americans for this portrait of Richard T. De George. R. Edward Freeman is the Elis and Signe Olsson Professor of Business Administration and Director of the Olsson Center for Ethics at The Darden School, University of Virginia, Charlottesville, VA 22906‐6550; and Martin Calkins, SJ, is a Research Assistant in the Olsson Center and a doctoral student in business ethics at the Darden School.

This article discusses plant‐closing decisions by multinational enterprises (MNEs) applying a stakeholder theory approach. In particular, we focus on the emergence of “intra‐stakeholder alliances,” that is, alliances among the various stakeholder groups of a specific corporation. We analyze the emergence of stakeholder alliances in reaction to MNEs' decisions to terminate production locally and discuss their influence on the outcomes of such decisions. Our research is inspired by two exceptional case studies of two multinational breweries that announced their decisions to close niche breweries in small towns in Italy and Belgium. In both cases, the initial decision was ultimately reversed through the actions of intra‐stakeholder alliances. We combine insights from stakeholder theory and the social movement literature to analyze the action and influence of intra‐stakeholder alliances in seven cases of plant‐closing decisions. We conclude by formulating four general propositions that can provide guidance to MNE management in plant‐closing decisions. Our findings extend managerial stakeholder theory, show how this approach can improve strategic management analysis, emphasize the importance of the relationships among (local) stakeholders in the (global) value‐creation process, and shed light on the collective action and influence of intra‐stakeholder alliances.

The purpose of this paper is to suggest that at least one strain of what has come to be called “stakeholder theory” has roots that are deeply libertarian. We begin by explicating both “stakeholder theory” and “libertarian arguments.” We show how there are libertarian arguments for both instrumental and normative stakeholder theory, and we construct a version of capitalism, called “stakeholder capitalism,” that builds on these libertarian ideas. We argue throughout that strong notions of “freedom” and “voluntary action” are the best possible underpinnings for stakeholder theory, and in doing so, seek to return “stakeholder theory” to its managerial and libertarian roots found in Freeman

The purpose of this work is to articulate the terrain of foundational issues in strategic management research and suggest a framework for understanding and justifying the generation of knowledge in this field. The authors propose a framework with four dimensions: specification of the strategic decision, identification of decision level, delineation of the purpose of the decision, and specification of the decision context. Freeman and Lorange demonstrate that the proposed framework points towards a building block approach for reaching a full-blown theory of strategy, and that there exists too little theory to enable researchers to integrate the bits and pieces into a coherent whole.

Just as the ideas of stakeholder theory, stakeholder management, or stakeholder capitalism approach acceptance as a mainstream core idea in management theory, the authors want to suggest a somewhat radical rethinking of it. They believe that in almost all of its incarnations, stakeholder theory merely recapitulates some rather standard business assumptions. As a result, they believe that two problems are perpetuated—the separation of ethics and value creation and the overemphasis of stakeholder roles rather than relationships between stakeholders as real people with names and faces. In this article, the authors propose that by adopting a view of stakeholders as real people with names and faces, they can reinvigorate stakeholder research and focus their efforts on the neglected challenge of understanding how collections of idiosyncratic individuals can work together to create value in entrepreneurial firms in ways that benefit all those who are affected.

This chapter begins by examining the history of business schools and establishing the presence of three important phases: the formative period, the scientific / modern period, and the porter / peters era. In the second section of the essay, the author suggests a reorientation of professional schools of business along more pragmatic lines, including the integration of “humanities questions” into business school curriculum. Additionally, Freeman offers concrete suggestions for how business schools can change to open the possibility of seeing business as a humanity subject.

Stakeholder theory has become one of the most important developments in the field of business ethics. While this concept has evolved and gained prominence as a method of integrating ethics into the basic purposes and strategic objectives of the firm, the authors argue that stakeholder theory has retained certain “masculinist” assumptions from the wider business literature that limit its usefulness. The resources of feminist thought, specifically the work of Carol Gilligan, provide a means of reinterpreting the stakeholder concept in a way that overcomes many of the existing limitations. This reading provides a different understanding of the identity and meaning of the firm, specifically in terms of its relationship to stakeholder groups and what it means for a firm to succeed. The alternatives proposed also converge with recent trends in the wider management literature and provide practical guidance for firms which face a myriad of challenges in the increasingly complex and global marketplace.

This essay discusses the concept of “creative destruction” within different business industries, specifically the example of Uber’s string of controversies that led to a mass exodus of senior executives. The authors reveal that there is a creative upside to cheating as demonstrated by the research done by Francesca Gino and Scott Wiltermuth. Furthermore, Freeman and Bidhan recommend that companies should make an effort to understand which rules are worth breaking and why. Lastly, the authors emphasize that there is more to business than narrow outcomes defined as shareholder value.

The recent financial crisis has prompted questioning of our basic ideas about capitalism and the role of business in society. As scholars are calling for “responsible leadership” to become more of the norm, organizations are being pushed to enact new values, such as “responsibility” and “sustainability,” and pay more attention to the effects of their actions on their stakeholders. The purpose of this study is to open up a line of research in business ethics on the concept of “authenticity” as it can be applied in modern organizational life and more specifically to think through some of the foundational questions about the logic of values. We shall argue that the idea of simply “acting on one’s values” or “being true to oneself” is at best a starting point for thinking about authenticity. We develop the idea of the poetic self as a project of seeking to live authentically. We see being authentic as an ongoing process of conversation that not only starts with perceived values but also involves one’s history, relationships with others, and aspirations. Authenticity entails acting on these values for individuals and organizations and thus also becomes a necessary starting point for ethics. After all, if there is no motivation to justify one’s actions either to oneself or to others, then as Sartre has suggested, morality simply does not come into play. We argue that the idea of responsible leadership can be enriched with this more nuanced idea of the self and authenticity.

This article examines the recent controversy in health care delivery about whether it should be conceptualized as a business. The current debate implicitly appeals to a common understanding of business and business practices that is no longer very useful. This common notion, which the authors call “cowboy capitalism,” conceptualizes business as a competitive jungle resting on self-interest and an urge for competition in order to survive. The authors suggest that stakeholder capitalism offers a more useful framework for the dialogue about health care reform.

One of the central uses of stakeholder theory, in its original form, was as a counterpoint to the idea that corporations should be managed in the interests of shareholders. As the theory developed the debate was often framed in terms of “shareholders vs. stakeholders.” While developing “theories of the firm” is an interesting and useful project, focusing solely on “theory of the firm” obscures a more important contribution of stakeholder theory. The purpose of this brief essay is to set forth what I consider to be the central insight of stakeholder theory: the jointness of stakeholder interests.

The purpose of this paper is to enter the conversation about stakeholder theory with the goal of clarifying certain foundational issues. I want to show, along with Boatright, that there is no stakeholder paradox, and that the principle on which such a paradox is built, the Separation Thesis, is nicely self-serving to business and ethics academics. If we give up such a thesis we find there is no stakeholder theory but that stakeholder theory becomes a genre that is quite rich. It becomes one of many ways to blend together the central concepts of business with those of ethics. Rather than take each concept of business singly or the whole of “business” together and hold it to the light of ethical standards, we can use the stakeholder concept to create more fine-grained analyses that combine business and ethics; or more simply, we can tell many more, and more interesting, stories about business.