FROM FINANCIAL PERFORMANCE FOR SHAREHOLDERS TO GLOBAL PERFORMANCE FOR STAKEHOLDERS
The global business environment (at every of its levels and by any of its forms) is more and more competitive and challenging for firms nowadays. On the other hand, firms themselves exercise a growing pressure and influence over the society (by their economic, social and environmental – wanted or not – outputs/effects). There is no doubt about those facts. Under these circumstances, new theories and practices emerged, in order to bring together and make long term peace between firms/businesses and society (as a whole and considering each part and category of it as well). Stakeholders’ theory and corporate responsibility theory come into discussion when we talk about business cooperation and sustainable development, according with the future generations best interests. As a result, together with the new theory and philosophy of the firm, we (and firm management) must consider a new paradigm when measuring corporate performance: the transition form shareholders to stakeholders brings with it the transition from financial reporting to social reporting, in order for firms and their management to be able to manage and measure global firm performance (financial, as well as social and environmental, in the idea to positively answer to all the interests stakeholders have – a request of doing well by doing good). By this paper, we would like to analyze how the transition from satisfying shareholders interests theory to satisfying stakeholders interests’ theory changes the way management seeks for and measures corporate performance, and how this shift is perceived. In order to do this, we will bring together the Most Profitable Fortune Global 500 versus 100 Most Sustainable Corporations in the World and will analyze: the correlation between financial performance and social performance; the measure these two kinds of performance leverage each other – in order to achieve global corporate performance by satisfying all kind of stakeholders’ interests.
