BUS 100 Lecture Notes - Lecture 1: Honeywell, B Lab, Executive Compensation

• School: George Mason University
• Department: Business
• Course: BUS 100
• Professor: Anne Lauer

Document Summary

All business decisions have a social impact. The vitality of business depends on society"s action and attitudes. *forces that shape the business and society relationship (20): Growing emphasis on ethical reasoning and actions. Owners: their interests are paramount and take precedence over the interest of others. Descriptive argument says that the stakeholder view is simply a more realistic description of how companies really work. Instrumental argument says that stakeholder management is more effective as a corporate strategy. People and groups who although they do not engage in direct economic exchange with the firm are nonetheless affected by or can affect its actions. Stakeholder power means the ability to use resources to make an event happen or to secure a desired outcome (13). There are 5 different types of power: voting power: the stakeholder has a legitimate right to cast a vote, economic power: anyone who can influence a business"s profits or losses holds economic power over that business.