Organisations & Society - Assignment 3
Assignment 3.1
As is stated in Mitchell´s paper, there is no clear definition of stakeholders. According to him,
there are some vague definitions such as everyone that is affected (directly or indirectly) by
the firm's action. Also Freeman (1984) states that there is no agreement on what the
stakeholder is, or as Freeman calls it: the principle of who or what really counts. So, authors
made a distinction regarding the way a firm (or people in general) can look at stakeholders.
But to not exclude anyone, he uses the above stated definition by Freeman (1984).
To analyse the concept of stakeholders, Mitchel states there is the broad definition of
stakeholder, which states that a stakeholder is anyone how can affect or can be affected by an
organization. Consequently, this can be almost everyone, with the result that a stakeholder
identification process is more than required.
Besides that, there is the narrow, more pragmatic definition, in which is stated that managers
simply cannot pay attention to all the people who can affect or can be affected by the
organization. Consequently, they only pay attention to the very important ones. So, when one
uses this definition, stakeholders are people on which the organization is dependent for its
survival (Mitchell, 1997).
In order to further help organizations to identify stakeholders, independent of the
definition they use, Mitchell uses another distinction between ‘claimant’ stakeholders (people
who have a claim on the organization) and ‘influencer’ stakeholders (people who can
influence the firm, with or without claim). If one also uses the concepts of power, legitimacy,
and salience (urgency), it enables an organization to not only identify, or maybe define, their
own stakeholder, but also to make an estimation of who or what should get (the most)
attention.
Just as Mitchell (1997), Kaler (2002) also sees a variety of definitions. So he also makes a
distinction between claimants and influencers and uses the same definitions of the two
concepts as Michell (1997). However, the difference between the perspective of Mitchell and
Kaler is that Kaler also takes a combination of the two into account. So a stakeholder could
be an influencer, a claimant, or even both. But, Kaler underlines that the use of the concepts
of influencer and a combination or both of them is rather confusing (Kaler, 2002).
, Consequently, Kaler defines stakeholders as those with a claim on its services: More
particular, as strong or weak, role-specific, morally legitimate claim to have their interests
served by that business (Kaler, 2002. p98).
If one links the different stakeholder definitions described above to the concepts of CSR, the
first thing that has to be done is to clarify the two CSR approaches: instrumental (isolating)
and responsible (integrity) incorporation. The first one is based on some sort of cost-benefit
analysis. Based on that analysis, an organization can consider, based on its goals, if it is going
to comply with the rules and societal programmes, or not (or somewhere in between those
extremes). The second mode does not use any analysis. On contrary, independent of goals,
costs, benefits, etc. an organization complies because it is the right thing to do.
If one looks at Mitchell’s article, it can be seen that it is very descriptive and analytic.
Consequently, in order to identify an organization’s stakeholders and how important they are,
an analysis, maybe even a cost-benefit analysis, has to be conducted. This will result in some
sort of hierarchy which displays stakeholders from important to less important or even
irrelevant. Consequently, with Mitchell’s (1997) conceptual work regarding stakeholders, it is
possible to identify an organization's stakeholders and their importance using the three
concepts (power, legitimacy, and urgency) and create a hierarchy.Such an analysis is very
important, and often used, while using the instrumental mode of incorporation.
To conclude, one could state that the Mitchell’s descriptive way of looking at stakeholders
can contribute to instrumental incorporation, because by using analyses it is possible to make
a distinction between important and less important stakeholders, and which stakeholders an
organization should take into account while doing business.
While doing that, Mitchell (1997) does not describe any moral or ethical implications an
organization should or can take into consideration, while analysing their stakeholders or
environment. This also is an instrumental way of thinking about incorporation.
Kaler (2002) on the contrary, also considers moral aspects while looking at stakeholders.
More specifically, he states that stakeholders are the people who have a morally legitimate on
the services on the business. So, Kaler also take morality into account, which is an important
aspect of conducting CSR. Consequently, Kaler (2002), does not use an analysis, such as
Mitchell (1997), in order to identify the (important) stakeholders.
Assignment 3.1
As is stated in Mitchell´s paper, there is no clear definition of stakeholders. According to him,
there are some vague definitions such as everyone that is affected (directly or indirectly) by
the firm's action. Also Freeman (1984) states that there is no agreement on what the
stakeholder is, or as Freeman calls it: the principle of who or what really counts. So, authors
made a distinction regarding the way a firm (or people in general) can look at stakeholders.
But to not exclude anyone, he uses the above stated definition by Freeman (1984).
To analyse the concept of stakeholders, Mitchel states there is the broad definition of
stakeholder, which states that a stakeholder is anyone how can affect or can be affected by an
organization. Consequently, this can be almost everyone, with the result that a stakeholder
identification process is more than required.
Besides that, there is the narrow, more pragmatic definition, in which is stated that managers
simply cannot pay attention to all the people who can affect or can be affected by the
organization. Consequently, they only pay attention to the very important ones. So, when one
uses this definition, stakeholders are people on which the organization is dependent for its
survival (Mitchell, 1997).
In order to further help organizations to identify stakeholders, independent of the
definition they use, Mitchell uses another distinction between ‘claimant’ stakeholders (people
who have a claim on the organization) and ‘influencer’ stakeholders (people who can
influence the firm, with or without claim). If one also uses the concepts of power, legitimacy,
and salience (urgency), it enables an organization to not only identify, or maybe define, their
own stakeholder, but also to make an estimation of who or what should get (the most)
attention.
Just as Mitchell (1997), Kaler (2002) also sees a variety of definitions. So he also makes a
distinction between claimants and influencers and uses the same definitions of the two
concepts as Michell (1997). However, the difference between the perspective of Mitchell and
Kaler is that Kaler also takes a combination of the two into account. So a stakeholder could
be an influencer, a claimant, or even both. But, Kaler underlines that the use of the concepts
of influencer and a combination or both of them is rather confusing (Kaler, 2002).
, Consequently, Kaler defines stakeholders as those with a claim on its services: More
particular, as strong or weak, role-specific, morally legitimate claim to have their interests
served by that business (Kaler, 2002. p98).
If one links the different stakeholder definitions described above to the concepts of CSR, the
first thing that has to be done is to clarify the two CSR approaches: instrumental (isolating)
and responsible (integrity) incorporation. The first one is based on some sort of cost-benefit
analysis. Based on that analysis, an organization can consider, based on its goals, if it is going
to comply with the rules and societal programmes, or not (or somewhere in between those
extremes). The second mode does not use any analysis. On contrary, independent of goals,
costs, benefits, etc. an organization complies because it is the right thing to do.
If one looks at Mitchell’s article, it can be seen that it is very descriptive and analytic.
Consequently, in order to identify an organization’s stakeholders and how important they are,
an analysis, maybe even a cost-benefit analysis, has to be conducted. This will result in some
sort of hierarchy which displays stakeholders from important to less important or even
irrelevant. Consequently, with Mitchell’s (1997) conceptual work regarding stakeholders, it is
possible to identify an organization's stakeholders and their importance using the three
concepts (power, legitimacy, and urgency) and create a hierarchy.Such an analysis is very
important, and often used, while using the instrumental mode of incorporation.
To conclude, one could state that the Mitchell’s descriptive way of looking at stakeholders
can contribute to instrumental incorporation, because by using analyses it is possible to make
a distinction between important and less important stakeholders, and which stakeholders an
organization should take into account while doing business.
While doing that, Mitchell (1997) does not describe any moral or ethical implications an
organization should or can take into consideration, while analysing their stakeholders or
environment. This also is an instrumental way of thinking about incorporation.
Kaler (2002) on the contrary, also considers moral aspects while looking at stakeholders.
More specifically, he states that stakeholders are the people who have a morally legitimate on
the services on the business. So, Kaler also take morality into account, which is an important
aspect of conducting CSR. Consequently, Kaler (2002), does not use an analysis, such as
Mitchell (1997), in order to identify the (important) stakeholders.
