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Winning Essay from The Interleges Award 2014: in memory of Stephen Rayner

‘Whom the corporation should serve’ is a debate dating back to several decades before the financial crises agitating the beginning of the twenty first century. Since the early 1930’s, the legal frameworks of corporate governance defining investors as the only group of interests the company should serve have been strongly criticised. The recent financial crises have highlighted the fact that corporations impact a wider spectrum of interests than just shareholders. Corporations can affect the commercial, social and ecological environments in which they operate. More broadly, corporations can be seen as also affecting the society of which they are a part. Consumers, employees, business partners, and governments rely on the products and economic activity produced by companies. For these reasons, it has been argued that the company should take into consideration other groups of interests than simply that of shareholders during the running of its business. This reasoning submits that the society’s diverse interests and needs should have a place in the management of the company. Such interests are often referred to as the company’s stakeholders.