According to stakeholder theory, a company should consider the interests of:
Correct answer: C. Shareholders and other affected groups such as employees and communities
- A. Only shareholders who own voting shares
- B. Only senior managers who make strategic decisions
- C. Shareholders and other affected groups such as employees and communities
- D. Only government agencies that issue operating licences
Explanation
Stakeholder theory recognizes that business decisions affect groups beyond shareholders. Employees, customers, suppliers, communities, and regulators may all have legitimate interests.
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About Business Ethics and Corporate Governance
Business ethics applies principles such as honesty, fairness, responsibility and transparency to decisions involving employees, customers, investors, competitors and society. Corporate governance covers the board of directors, accountability, disclosure, internal controls, stakeholder interests, agency conflicts, corporate social responsibility, codes of conduct and whistleblowing.
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