ASSESSMENT 02 ACCOUNTING THEORY Assessment Two Essay 30% Due Week 11 Assignment requirements An extensive academic practical approach research paper has been provided to you, “Is stakeholder theory...

Is Stake Holder’s Theory Ethical
The blood of an economy is the business that operates around the globe. For a business to be successful it has to be profitable and be satisfiable to all the stake holders of the business. The need for the business to be committed towards its stakeholders is explained in the normative theory. It is also called intrinsic stakeholder commitment model as the need of the stakeholders is having an intrinsic value. These needs form the basis of a corporate strategy and give a moral foundation for the management for its decision making. The theory explains in an angle that the attitude of management towards its stakeholders is based on moral commitments. The morality of the management’s action overcomes the desire to maximize the profit by exploiting the stakeholders.
The normative principle guides a business to establish fundamental moral principles that guides the actions of a management towards those associated with a business. Many corporates uses this theory as a basis for their decision making in their crucial times.
A stake holder can be anyone who expresses an interest over the business or over a particular project or the organization as a whole. It can be anyone as an investor, potential investor, bankers, financial institutions, creditors, customers etc. They are someone who would be affected the large by the outcomes of a business or a project. This is the starting point of a stakeholder’s theory. There can be negative and positive impacts on the actions of the stake holders as they aren’t idle they actively participate in one or the other way the running of an organization or a project.
Stakeholders have the power to influence over the matters of the project or an organization thus it is the duty of the management to prioritize and focus on the stockholders those with power that has the proximity and a level of urgency. A stakeholders theory intends to address the ethics to be involved in a business, the moral and the values that needed to be focused when managing with the stakeholder’s and how to improve the efficiency of a project.
The wide usage of stakeholder’s theory by the management in the business is for the examination of the organizational environment that includes both internal and the external environment, Strategic management, examining the ethical issues, the planning stage of the activities or projects that concerns the greater larger public in whole, environmental management etc. These theory identified the fact that the stakeholders has the power to make a business profitable, implement business decisions faster and easier, and a successful means to collect the data’s of the public and utilize it in a way beneficial to the organization.
Normative theories provides due consideration to data’s and facts that works with the future events in an organization. It helps the management to plan for the future and to be prepared for the further...