The Inevitability and Desirability of the Corporate Discretion to Advance Stakeholder Interests

Abstract

Recent work has argued that a corporate discretion to advance the interests of stakeholders is illusory and undesirable. This article argues that, to the contrary, such discretion is both inevitable and desirable.

Keywords: corporate purpose, corporate social responsibility, stakeholders, stakeholder governance, stakeholder capitalism, corporate constituencies, enlightened shareholder value, corporate governance, Business Roundtable, constituency statutes, entrenchment, accountability, managerialism

JEL Classification: D21, G32, G34, G38, K22