What Stakeholder Theory is Not

TLDR

Stakeholder theory is conceptually broad, with varying interpretations that elicit both praise and criticism, making it a strength and a liability. This paper aims to act as a controlled burn, clearing misinterpretations to prevent the theory’s potential collapse. By narrowing the technical definition and dissecting common misinterpretations, the authors seek to provide a clearer, more robust foundation for future research.

Abstract

Abstract: The term stakeholder is a powerful one. This is due, to a significant degree, to its conceptual breadth. The term means different things to different people and hence evokes praise or scorn from a wide variety of scholars and practitioners. Such breadth of interpretation, though one of stakeholder theory’s greatest strengths, is also one of its most prominent theoretical liabilities. The goal of the current paper is like that of a controlled burn that clears away some of the underbrush of misinterpretation in the hope of denying easy fuel to the critical conflagration that would raze the theory. We aim to narrow its technical meaning for greater facility of use in management and organizational studies. By elaborating a number of common misinterpretations – critical and friendly – of the theory, we hope to render a stronger and more convincing theory as a starting place for future research.