Does stakeholder theory provide a better basis for the development of Coursework

Does stakeholder opening provide a better nucleotide for the development of Corporate Governance in the 21st century than agency theor - Coursework ExampleIt is important to sympathise the meaning of integrated ecesis to be able to fully discuss its features. Even though thither be different variables that come into play because of the different operating environments in different nations, merged governance may refer to that process that leads to effective control, direction and accountability in organizations. As a result, merged governance involves elements like control, co-ordination, direction and the checks and balances associated with management of organizations. In addition to the definition of the term corporate governance, it is evenly important to point out that the practice has evolved over the years to become a more mixed but essential feature for the success of contemporary organizations. The concept of corporate governance has been fast choose in various par ts of the world but with some major variations because of the different circumstantial variations of nations (Clarke 2004). Consequently, in that respect have been different frameworks of corporate governance that have emerged as a result of this. However, there be two main approaches of corporate governance that can be identified. ... at had a tradition of normal law like Australia, United Kingdom, USA, Canada and New Zealand developed corporate governance structures that focused on sh beholders returns or interests. In their case, corporate governance was supposed to ensure that corporations achieved the objectives set by their owners. Consequently, the two main corporate governance approaches have been termed as insider and outsider approaches respectively. Having reviewed the background of corporate governance it is therefore important that the theories of corporate governance that have been put forth be discussed. Theories of Corporate Governance There are two theories of c orporate governance that have been proposed by scholars and of which will form a basis for this discussion. They include the stakeholder theory and the agency theory as discussed below. The Stakeholder Theory Also referred to as the stewardship theory, the theory proposed by Freeman is ground on the argument that organizations have a wider obligation of serving the general interests rather than just attaining the private-enterprise(prenominal) goal of wealth maximization (Mulili and Wong 2011). The theory holds that firms are socially responsible to all parties that interact with it or those that are affected by the firms quest on achieving its set objectives (Freeman et al 2010). As a result, corporate are said to be socially responsible to their stakeholders, that is, the suppliers, employees, clients, shareholders, interest groups and the government among other industry actors they are directly or indirectly involved with. It has been noted that stakeholders are important to co rporations because the manner in which they are handled determines their feedback (Gregg 2001). For instance, when they get more in terms of value or extra