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A Stakeholder Approach To Strategic Management

Darden Graduate School of Business Administration
University of Virginia
Working Paper No. 01-02
A Stakeholder Approach to Strategic Management
R. Edward Freeman
John McVea
This paper can be downloaded without charge from the
Social Science Research Network Electronic Paper Collection at:
http://papers.ssrn.com/paper.taf?abstract_id=263511
A Stakeholder Approach to Strategic Management
R. Edward Freeman
And
John McVea
The Darden School
University of Virginia
Forthcoming in M. Hitt, E. Freeman, and J. Harrison (eds.)
Handbook of Strategic Management, Oxford: Blackwell
Publishing.
INTRODUCTION
The purpose of this chapter is to outline the development of the idea of
"stakeholder management" as it has come to be applied in strategic management. We
begin by developing a brief history of the concept. We then suggest that traditionally the
stakeholder approach to strategic management has several related characteristics that
serve as distinguishing features. We review recent work on stakeholder theory and
suggest how stakeholder management has affected the practice of management. We end
by suggesting further research questions.
A HISTORY OF A STAKEHOLDER APPROACH TO STRATEGIC
MANAGEMENT
A stakeholder approach to strategy emerged in the mid-1980's. One focal point in
this movement was the publication of R. Edward Freeman's Strategic Management- A
Stakeholder Approach in 1984. Building on the process work of Ian Mitroff and Richard
Mason, and James Emshoff [ For statements of these views see Mason and
Mitroff,(1982) and Emshoff (1978)]. The impetus behind stakeholder management was
to try and build a framework that was responsive to the concerns of managers who were
being buffeted by unprecedented levels of environmental turbulence and change.
Traditional strategy frameworks were neither helping managers develop new strategic
directions nor were they helping them understand how to create new opportunities in the
midst of so much change....