Stakeholders
A stakeholder refers to an individual, group(s) or organizations that management and frontline employees consider before making a decision that will influence the performance of an organization. Stakeholders normally have vested interests in the various policies being developed, promoted and adopted (Goergen, 2010). Google Inc. has diverse stakeholders since it has a wide range of products, its diversification and the various interest parties. For the firm to maintain its leadership position in innovation it has to address stakeholders’ interests though appropriate policies for corporate social responsibility. Many of the CSR programs carried out by Google are focused on various stakeholder groups who include the users, customers such as advertisers, suppliers ,the investors or shareholders, government or regulatory authorities and the community (Meyer,2017).
These stakeholders can be classified as internal, external, voluntary and involuntary. Internal stakeholders include the ones included in the operations of an organization and in this case include employees and managers. External stakeholders are not involved in the running of the organization and for the case of Google they include the customers, users, investors or shareholders and the government. The voluntary or self-appointed stakeholders include those who have the choice of becoming shareholders or not like suppliers, customers and users. The involuntary stakeholders are those who have no choice but to be and include the community and government (Goergen, 2010).
Finding the balance between interest of shareholders and stakeholders is an issue that borders on ethics across many organizations since they have to satisfy the expectations of these groups simultaneously (Schmeer, n.d). Google has to find the right ethical balance which will ensure that there is dispute that will arise due to the various activities it carries out. There are various challenges that an organization faces while dealing with stakeholders and these include competing goals, allocating rewards and stakeholder trust. An organization strives to satisfy the goals of all the stakeholders, but the choice of the most important goals has social, political and economic implications. The initial responsibility if management is to maximize on shareholders wealth through maximization of return on investment. Since the organization does not focus only on the owners, a balance has to be struck between profitability, employees’ welfare and the interest of external stakeholders (Goergen, 2010). A risk may arise where employees and management choose to focus on their own interest at the expense profitability. The employees desire to gain from the services they render to the firm in monetary terms or career growth and management want to feel that their skills are being appreciated. This includes promoting the well-being of the employees for the period they will work in this organization. Since the organization operates with a community, it is expected to have a positive social influence through carrying outs its operations in transparency and openness and being friendly to the environment in which it operates (Goergen, 2010). For a company like Google, it is compelled to focus on being perceived as a responsible firm so as to build its reputation and defend it in the community in which it operates. The organization is also expected to comply with regulatory authorities expectations by carrying outs its activities in a legal manner. The need to address all these may lead to a reduction in competitiveness of the firm in important areas of corporate performance.
Allocation of rewards may also present a problem to an organization, and the question would be how inducements are to be shared among the various groups of stakeholders. The essential aspect is that expectation of each group has to be satisfied minimally. The issue is how much of rewards the managers and employees should be given relative to investors, how to determine the right rewards and the need for long-term organizational growth. Another issue is on how much of the reward that an organization should dedicate to the community it operates so as to be a socially responsible firm (Goergen, 2010). The firm is expected to allocate part o profits to projects whose course is serving the community from which the wealth is derived. Another area that is a challenge to an organization is winning the trust of stakeholders since it would be difficult to operate without establishing such as trust. Whether Google is dealing with users, employees, regulators and the community, building trust through ethical behavior determines the overall performance. The organization has to embrace a code of values which it must instill into managers and employees so that it becomes accepted into the community. The corporate culture has reflect this culture so that cases of falsifying financial position , violations of laws and disregard for overall stakeholders need does not jeopardize its operation and image. A popular idea is that only organizations that are socially responsible are able to maximize profits and thereby increase shareholders stock price and wealth (Goergen, 2010). However, it may not be possible to strike the balance for all interests of shareholders and be a moral agent. The stakeholders may disagree with the method of conducting business if their interests are not met as they desire.
An ethical dilemma occurs when one is morally obliged to adhere to various courses of actions but the situation can only allow one choice among these choruses if action. Some stakeholders such as managers, investors and suppliers can present such a dilemma while dealing with them (Ferrell, Fraedrich & Ferrell, 2008). For instance, an employee would be faced by the choice of reporting unethical actions by his or her boss who gets involved in some kind of corporate fraud that may affects the performance and the reputation of the organization. Many workers in such circumstances can be conflicted in the risk of losing a job, which would make it hard for them to continue meeting their obligation to care for their dependants. If they go ahead and report the fraud, other stakeholders are put at risk. In addition, the shareholders may put pressure on management to increase the profitability of their firm, and this is legally accepted as the major goals of a company. It may sound moral and reasonable but it can make the managers to get involved in corporate scandals where legal boundaries are toed to meet such obligations. However, where statutory limitations are not violated, the wrong decision making may end up hurting the many other stakeholders (Ferrell, Fraedrich & Ferrell, 2008). Google shareholders may emphasize on the need to attain maximum profits which may lead to the firm releasing products that are considered unethical or not appropriate to the community. They management is presented with ethical dilemmas.
References
Ferrell, O. C., Fraedrich, J., & Ferrell, L. (2008). Business ethics: Ethical decision making and cases. Boston: Houghton Mifflin Co. 30-37
Schmeer, K. (n.d). Stakeholder Analysis Guidelines. Retrieved from: http://www.who.int/workforcealliance/knowledge/toolkit/33.pdf
Goergen, M. (2010). Corporate governance and complexity theory. Cheltenham: Edward Elgar. 2-26
Meyer, P., (2017).Google Stakeholders & Corporate Social Responsibility (CSR). Retrieved from: http://panmore.com/google-stakeholders-corporate-social-responsibility-csr-analysis
