The normative view of stakeholders

The normative view of stakeholder theory centres around the notion of civil duties which are important in maintaining and increasing overall good in society. It is based upon the concept that we each have a moral duty to each other in respect of taking into account each others’ concerns and opinions. Not to do so will result in the atrophy of social cohesion and will ultimately lead to everybody being worse off morally and possibly economically.

Extending this argument to stakeholder theory, the normative view argues that organisations should accommodate stakeholder concerns not because of what the organisation can instrumentally ‘get out of it’ for its own profit, but because by doing so the organisation observes its moral duty to each stakeholder.

The normative view sees stakeholders as ends in themselves and not just instrumental to the achievement of other ends.

The instrumental view of stakeholders

The instrumental view of stakeholder relations is that organisations take stakeholder opinions into account only insofar as they are consistent with other, more important, economic objectives (e.g. profit maximisation, gaining market share, compliance with a corporate governance standard).

Accordingly, it may be that a business acknowledges stakeholders only because acquiescence to stakeholder opinion is the best way of achieving other business objectives. If the loyalty or commitment of an important primary or active stakeholder group is threatened, it is likely that the organisation will recognise the group’s claim because not to do so would threaten to reduce its economic performance and profitability.



It is therefore said that stakeholders are used instrumentally in the pursuit of other objectives.