Ethical Business Leadership in Troubling Times
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Ethical Business Leadership in Troubling Times

Edited by Joanne B. Ciulla and Tobey K. Scharding

Perhaps the fundamental question in CSR is: What are the responsibilities of businesses and business leadership to society? Moreover, do the responsibilities of business change in times of social and political turmoil? The chapters in this book tackle several aspects of these questions with chapters on business and politics, the environment, technology, and immigration; along with broader questions about leadership, governance, and the very nature of CSR.
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Chapter 7: The board of directors’ role in ensuring accountability and creating value: stakeholder and shareholder complementarity

Cynthia E. Clark


Boards and their directors, a central aspect of the firm’s leadership team, find themselves needing to be more accountable than they have ever been before. Accordingly, this chapter considers the corporate board and its ability to create value and to refocus the processes and outcomes of how it is held accountable. Initially, I start by looking at how stakeholder and shareholder views are largely complementary theoretical assumptions, both reflecting a social paradigm associated with the proper roles and responsibilities of firms. I then show how shareholder- and stakeholder-based views can be used to direct boards toward activities that reinforce one another by first outlining two main commonalities of both perspectives – accountability and value – and then illustrating how a board’s accountability to both shareholders or stakeholders can lead to value being created in the long term for the other. Lastly, I show how organizational values shape perceptions of how value is created.

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