Stakeholder theory is a theory of organizational management and business ethics that addresses morals and values in managing an organization. It was originally detailed by Freeman in the book Strategic Management: A Stakeholder Approach, and identifies and models the groups which are stakeholders of a corporation, and both describes and recommends methods by which management can give due regard to the interests of those groups. In short, it attempts play to address the "Principle of Who or What Really Counts."
In the traditional view of the firm, the shareholder view, the shareholders or stockholders are the owners of the company, and the firm has a binding fiduciary
duty to put their needs first, to increase value for them. However,
stakeholder theory argues that there are other parties involved,
including governmental bodies, political groups, trade associations, trade unions, communities, financiers, suppliers, employees, and customers.
Sometimes even competitors are counted as stakeholders - their status
being derived from their capacity to affect the firm and its other
morally legitimate stakeholders. The nature of what is a stakeholder is
highly contested (Miles, 2012), with hundreds of definitions existing in
the academic literature (Miles, 2011).