Assessing the Stakeholders’ Contribution to Business Value

P.G. Demidov Yaroslavl State University, Sovetskaya Str., 14, 150003 Yaroslavl, Russia

^* Corresponding author: karachev2011@yandex.ru

Abstract

Stakeholder theory is the most attractive fundamental concept to ensure the necessary improvement of corporate governance in the modern world, integrated into the idea of value maximization as the main strategic goal of the enterprise. The proposed concept of total value considers this category as the sum of the organizational wealth and the values of the stakeholders, which together constitute the total contribution of the economic system to public welfare. Recognizing not only the financial implications of stakeholder relationships, the authors propose practical tools for value management, based on the agreed interaction of stakeholders – the modeling of resource flows to optimize the resulting total value and the algorithm of step-by-step management of interaction with stakeholders. The modeling of value creation reflects both the organizational benefits of interaction and explicitly identifies the value of the stakeholders’ benefits, and also discloses a list of key management factors: the economic value of the resources used by parties, the fairness of the exchange, the relationship between interacting companies, the opportunity costs, etc. Critical aspects of value creation that go beyond profitability and economic returns are highlighted. Corporate values can only be understood by reference to the multiplicity of stakeholders’ value perspectives.It is recommended that the process of managing interaction with stakeholders should be guided by an extensive interpretation of the target (value) setting of the business, taking into account the totality of material and intangible resource flows between the parties.