Macroeconomics chapter 6-12

Stakeholder map

a geographical representation of the relationship of stakeholder salience to a particular issue

Fiduciary

a person who exercises power on behalf of another

Nonmarket stakeholders

although they do not engage in direct contact with the firm, nonmarket stakeholders include the community, various levels of government, nongovernment organization

Public issue

any issue that is a concern to an organization and one or more of its stakeholders

General systems theory

argues that all organisms are open to, and interact with, their external environments, most organisms cannot be understood in isolation but only in relationship with their surroundings

Stakeholder theory of the firm

argues that corporations serve a broad public purpose- to create value for society. Corporations create profit but they have other values such as professional development for their employees and innovative new products for their customers. Multiple obligations and all stakeholder's interests are being taken into account

Salience

something is salient when it stands out from a background, is seen as important or draws attention.

Iron law of responsibility

in the long run those who do not use power in ways that society considers responsible will tend to lose it

Environmental analysis

is a method that managers use to gather information about external issues and trends so that they can develop an organizational strategy that minimizes threats and takes advantage of new opportunities

Environmental intelligence

is the acquisition of information gained from analyzing the multiple environments affecting organizations

Stakeholder analysis

managers identify relevant stakeholders and to understand both their interests and the power they may have to assert these interests

External stakeholder

market stakeholder- stockholders, customers, creditors, suppliers, wholesalers and retailers, nonmarket stakeholder= governments, communities, nongovernmental organizations, business support groups, media, competitors

Internal stakeholders

market stakeholders- employees, managers

Corporate social responsibility

means that a corporation should act in a way that enhances society and its inhabitants and be held accountable for any of its actions that affect people, their communities, and their environment

Stages in the business-stakeholder relationship

o Inactive= companies that simply ignore stakeholder concerns o Reactive= generally act only when they are forced to, and in a defensive manner o Proactive= companies try to anticipate stakeholder concerns o Interactive= that companies actively engage with stakeholders in an ongoing relationship of mutual respect, openness, and trust

Stakeholder

refers to a person and group that affect or are affected by an organizations decision, policies, and operations

Business

refers to any organization that is engaged in making a product or providing a service for a profit

Society

refers to human beings and to the social structures they collectively create, used to refer to segments of humankind, such as members of a particular community, nation, or interest group

Corporate power

refers to the capability of corporations to influence government, economy and society based on their organizational resources

Competitive intelligence

refers to the systematic and continuous process of gathering, analyzing, and managing external information about the organization's competitors

Stakeholder power

the ability to use resources to make an event happen or to secure a desired outcome. Stakeholders have five different kinds of power= voting power, economic power, political power, legal power and informational power

Ownership theory of the firm

the firm is seen as the property of its owners. The purpose of the firm is to maximize its long-term market value, to make the most money it can for its shareholders who own a stock in the company. In this theory the owner's interests are paramount and take precedent to the interest of others

Stakeholder interests

the nature of each group's stake

Interactive social system

the system that business and society form. Each needs the other, and influences each other

Performance- expectations gap

there often is a gap between what the firm wants to do or is doing and what stakeholders expect

Market stakeholders

those who engage in economic transactions with the company as it carries out its purpose of providing society with goods and services