MICHAEL DEMPSEY - Cranfield University

can affect or who is affected by the achievement of an organization’s
purpose.’ Brummer (1991) draws attention to the fact that, under that
definition, virtually everyone is a stakeholder. Freeman narrows the
concept later to include only those groups that can presently damage a
firm or its reputation in some important way. Brummer suggests that
this confers stakeholder status on environmentalists, consumer
advocates and even terrorists.
This would seem to suggest some test of legitimacy. Donaldson and
Preston (1995) suggest that stakeholders are ‘persons or groups with
legitimate interests in procedural and/or substantive aspects of
(corporate) activity.’ They make the point that stakeholders are
identified by their interests in the organization, whether or not the
organization has any corresponding functional interest in them. Another
appealing approach to definition is that of Clarkson (1995A) who
suggests that stakeholders are risk-bearers. He argues that a
stakeholder has some form of capital, either financial or human, at risk
and, therefore, has something to lose or gain depending on an
organization’s behaviour. This is attractive because it recognises the
personal and often emotional attachment which many people have to
their unions and the corresponding moral duty (it could be argued) on
the part of union management to manage the organization in ways that
take this into account, perhaps to identify legitimate interests which
require their attention - to manage a tension not only between
management and politics but also between the active, elected, minority
and the passive majority; to take account, also perhaps, of the
legitimacy of different active minorities.
Implicit here is a moral basis of stakeholder management as it applies
to the management of unions. Whatever the language used, it will be
an issue in conceptualising the nature of that stakeholder management
to understand the judgments of legitimacy which managers make in
order to focus their managerial activities.
Donaldson and Preston (1995) present three theses concerning
stakeholder theory;
1. that stakeholder theory is descriptive in that it presents a model
of what the corporation is - a constellation of co-operative and
competitive interests possessing intrinsic value. This is one of
the foundations of the research propositions which assume that
this is the case in trade unions and that stakeholder
management is a central feature of the work of union managers.
2. that stakeholder theory is instrumental, in that it establishes a
framework for examining the connections, if any, between the
practice of stakeholder management and the achievement of
various corporate performance goals. This is more problematic
in the case of unions. Corporate performance of unions is not
usually measurable in economic terms and, as is the case with
most not for profit organizations, (see, e.g. Kanter and Summers
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