On completion of this chapter, the reader should be able to do the following:

LO 8.1: Discuss the relationship between stakeholders’ interests and ethical decision-making.

LO 8.2: Recognize that the interests of some stakeholders are interdependent, and therefore that a company’s actions to benefit one stakeholder can benefit or harm other stakeholders.

LO 8.3: Explain shareholder theory, its justifications, and challenges to it.

LO 8.4: Explain stakeholder theory, its justifications, and challenges to it.

LO 8.5: Assess the impacts of ethical decisions that go beyond compliance with the law on the firm’s financial performance (i.e., whether it “pays to be good” and the reasons why or why not).

LO 8.6: State the reasons for, characteristics of, and benefits of interactive stakeholder management.

LO 8.7: Incorporate stakeholder and shareholder interests into the weight-of-reasons framework for ethical decision-making.