Western Governors University (WGU) BUS3000 C717 Business Ethics Pre-assessment Practice Exam

The significance of stakeholder theory lies in its emphasis on recognizing and balancing the interests of all parties affected by business decisions. This approach broadens the scope of responsibility beyond shareholders to include various stakeholders such as employees, customers, suppliers, community members, and the environment. The idea is that businesses must consider the impact of their actions on these groups, not just on profit margins.

This theory promotes ethical decision-making and corporate social responsibility, acknowledging that a company’s long-term success is tied to the well-being of all its stakeholders. By adopting this perspective, organizations are encouraged to build sustainable and trusting relationships, fostering loyalty and positive reputations that ultimately benefit the business and society at large. In practice, this means that companies are more likely to engage in practices that enhance their social responsibility and ethical behavior, aligning their goals with the values and interests of the wider community they operate in.