CHAPTER 20
THE DEVELOPMENT OF STAKEHOLDER THEORY
AN IDIOSYNCRATIC APPROACH
R. EDWARD FREEMAN
20.1 INTRODUCTION
THE purpose of this chapter is to trace the development of what has come to he known as “stakeholder theory.” I intend to accomplish this in a manner that could be called “autobiographical” or “idiosyncratic” because I want to illustrate a philosophical point about the general issue of “theory development” and the importance role for "the author." To claim that “the author” has an important role in the development of management theory is neither to promote the sell importance of particular individuals nor to deny the role of inter-subjective agreement that is so vital in science. Rather it is to claim that contextual factors and serendipity can be crucial in process of theory development. In section 20.1 I shall offer a brief explanation of my interest in stakeholder theory. In particular I focus on the contextual factors around my eventual publication of Strategic Management: A Stakeholder Approach in 1984. Section 20.3 is a brief summary of that book and an assessment of its strengths, weaknesses, and analysis of some “misinterpretations" that have led to what we now know of as “stakeholder theory". Section 20.4 is my assessment of the current state of the art of “stakeholder theory" and some suggestions for the future development of the theory.