A key driver of corporate social responsibility is the notion of a triple bottom line- people, planet and profit. Shareholder theory focuses on profits, and ensuring investors interests are being reflected in executive decision-making. However, when one considers that a business as a part of the community has so many parties besides shareholders that are directly affected by the business, it seems unethical to ignore these stakeholders when a company makes decisions. Stakeholder theory, then, brings on entirely new implications as far as which parties businesses should serve.
A business’ human assets must be respected and treated well in order for the business, and the communities it operates in, to remain peaceful. If they are treated poorly or are underpaid, this results in unrest, poverty and a lack of peace. The business must also treat the environment as a stakeholder, as its resources are limited and the business relies upon their availability. Also, lack of resources, namely water, can create conflict as can climate change as a result of CO2 emissions. Finally, however, shareholders must also be considered because if there is not “peace” among shareholders, they will discontinue investing in the company and the company and its community will suffer as a result. The ethical issues arise when a business must be forced to balance these stakeholders and find compromise that may or may not serve all of the parties involved, which causes a lack of peace.