Corporate Responsibilities: Shareholders vs. Stakeholders

This chapter analyzes the evolving role of corporations in political and social issues, contrasting shareholder primacy with stakeholder capitalism. It discusses the economic outcomes of both approaches, demonstrating that shareholder-focused models have generally yielded superior returns in the U.S. compared to Europe. Additionally, it explores the rise of ESG initiatives and the influence of significant investment firms on corporate America following socio-political changes, questioning the balance between profit motives and social responsibility.