R. Edward Freeman

R. Edward Freeman is an American philosopher and management theorist, long based at the University of Virginia's Darden School of Business. His 1984 book Strategic Management: A Stakeholder Approach established stakeholder theory, which holds that a firm should be understood and managed in terms of its relationships with all groups that affect or are affected by it, not only its shareholders. He has argued that business and ethics should not be treated as separate subjects.

Key ideas

• A stakeholder is any group or individual who can affect or is affected by a firm's purpose.
• Managers have obligations to customers, employees, suppliers and communities as well as to shareholders.
• The separation thesis, which treats business and ethics as distinct, should be rejected.
• Value creation is a cooperative process among stakeholders rather than a zero-sum contest.

Major works

• Strategic Management: A Stakeholder Approach (1984)
• Stakeholder Theory: The State of the Art (2010, with co-authors)

In the conversation

• Question What did Milton Friedman actually argue in his 1970 essay on business and profit? Rohan Desai · 4 replies