Which of the following scenarios best illustrates a good stakeholder strategy?
A) VP Inc. follows a strategy in which maximization of the shareholders wealth is the primary concern of the managers.
B) Carrvero Inc. ensures that its employees are paid the least in the industry so that its external stakeholders can get the best price.
C) PA Corp. distributes only 70 percent of its annual profit after tax to shareholders, while the remaining is distributed among employees and the local community, and invested for further research.
D) Gen Pharma Corp. ensures that it fully exploits free natural resources, so that most of its profits go to shareholders in the form of dividends.

Question

Quizplus · Accepted Answer

PA Corp. demonstrates a good stakeholder strategy because it distributes only 70 percent of its annual profit after tax to its shareholders, while the remaining is distributed among employees and the local community, and invested for further research. A core tenet of stakeholder strategy is that a single-minded focus on shareholders alone exposes a firm to undue risks that can undermine economic performance and can even threaten the very survival of the enterprise.

Which of the Following Scenarios Best Illustrates a Good Stakeholder