Darden Graduate School of Business Administration
University of Virginia

Working Paper No. 01-02

A Stakeholder Approach to Strategic Management
R. Edward Freeman John McVea

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A Stakeholder Approach to Strategic Management R. Edward Freeman And John McVea The Darden School University of Virginia Forthcoming in M. Hitt, E. Freeman, and J. Harrison (eds.) Handbook of Strategic Management, Oxford: Blackwell Publishing.

INTRODUCTION The purpose of this chapter is to outline the development of the idea of “stakeholder management” as it has come to be applied in strategic management. We begin by developing a brief history of the concept. We then suggest that traditionally the stakeholder approach to strategic management has several related characteristics that serve as distinguishing features. We review recent work on stakeholder theory and suggest how stakeholder management has affected the practice of management. We end by suggesting further research questions.

A HISTORY OF A STAKEHOLDER APPROACH TO STRATEGIC MANAGEMENT A stakeholder approach to strategy emerged in the mid-1980’s. One focal point in this movement was the publication of R. Edward Freeman’s Strategic Management- A Stakeholder Approach in 1984. Building on the process work of Ian Mitroff and Richard Mason, and James Emshoff [ For statements of these views see Mason and Mitroff,(1982) and Emshoff (1978)]. The impetus behind stakeholder management was to try and build a framework that was responsive to the concerns of managers who were being buffeted by unprecedented levels of environmental turbulence and change. Traditional strategy frameworks were neither helping managers develop new strategic directions nor were they