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Shareholders and stakeholders value creation: an analytic foundation for value creation indicators

Author

Listed:
  • Rainer S. Masera

    (LillSS Guido Carli, Roma (ltaly))

  • Giancarlo Mazzoni

    (Banca d'Italia, Servizio Vigilanza sugli Enti Creditizi, Roma (ltaly))

Abstract

The academic debate on the theory of the firm has been monopolized for a long period by the contraposition between the shareholders model and the stakeholders model. Jensen (2001) introduced the concepts of "enlightened value maximization" and "enlightened stakeholders theory", recognizing the importance of the different constituencies for the maximization of the firm's market value. Masera (2006a) developed a "a quantitative synthesis of the enlightened stakeholders theory", supporting the idea that the total value of the firm is maximized when the management maximize both the remuneration of the shareholders and the efficiency and the satisfaction of the all the other stakeholders. In this paper, this thesis will be formalized by proposing a model in which a stochastic behavior for the most relevantvalue indicators is assumed. We will show that the model can be easily extended, allowing the simultaneous analysis of both value creation and capital structure problems.

Suggested Citation

  • Rainer S. Masera & Giancarlo Mazzoni, 2007. "Shareholders and stakeholders value creation: an analytic foundation for value creation indicators," Banca Nazionale del Lavoro Quarterly Review, Banca Nazionale del Lavoro, vol. 60(240), pages 3-31.
    • Handle: RePEc:psl:bnlqrr:2007:11
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    File URL: http://ojs.uniroma1.it/index.php/PSLQuarterlyReview/article/view/9876/9758
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    References listed on IDEAS

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    1. Alchian, Armen A & Demsetz, Harold, 1972. "Production , Information Costs, and Economic Organization," American Economic Review, American Economic Association, vol. 62(5), pages 777-795, December.
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    6. Vives,Xavier (ed.), 2006. "Corporate Governance," Cambridge Books, Cambridge University Press, number 9780521032032, October.
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    Cited by:

    1. Satu Pätäri & Ari Jantunen & Kalevi Kyläheiko & Jaana Sandström, 2012. "Does Sustainable Development Foster Value Creation? Empirical Evidence from the Global Energy Industry," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 19(6), pages 317-326, November.
    2. Donna M. Carlon & Alexis Downs, 2014. "Stakeholder Valuing: A Process for Identifying the Interrelationships between Firm and Stakeholder Attributes," Administrative Sciences, MDPI, vol. 4(2), pages 1-18, May.

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    More about this item

    Keywords

    Firm; Firms; Shareholder;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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