Stakeholder Theory: Al-Futtaim

A long reigning business is determined by how it copes with developing societies and generations. Its success is guaranteed long term if it is constantly insuring overall satisfaction to all involved parties. This is known as the Stakeholder theory. Although it isn’t necessarily every business’s responsibility to go the extra mile, the stakeholder approach insures a smooth blend of business efficiency and ethical behavior (Andrew L. Friedman and Samantha Miles, 2006, p.63). It is a bargain for all parties involved, especially the shareholders. If a business is providing its products and services in mass to consumers; it is already financially successful. For example, Halliburton. Yet, If a business is providing its products and services

Reichheld and Phil Schefter, 2000, P.1). This costumer satisfaction is achieved by insuring customer needs are met. Customers are a grand group of individuals, they constantly want fantastic products delivered in the ideal presentation with every different group of people demanding a certain criteria be met. The criteria branches out to employee treatment, environmental awareness and economic growth (Dave Hall-Rob Jones- Carlo Ruffo-Alain Anderton, 2008, p.23). This is present in Al-Futtaim, a family run private conglomerate. Al-Futtaim was originated in the United Arab Emirates with the family’s net worth $11.4 Billion (Forbes, 10/30/17) . Al Futtaim has a renown reputation in the middle east for all its involvement and input into the automative, retail and property development industry. The company doesn’t abuse corporate social responsibility as enterprise branding, but rather subtly works with NGOs and non profit organizations. It is prominent and glorious in the Arab region as it strongly holds value of its Emirati culture and heritage, which in return creates a strong bond with the locals. Its development and expansion plans are embedded with sustainable planning. Their growth is exponential as they don’t restrict the business hierarchy to the common fields (Human resources, finance and marketing). They integrated a sustainability and CSR department that

For Al-Futtaim, it is ‘ Respect, Excellence, Collaboration and Integrity are the values we live by, that help us action our Purpose and Vision. It is how we work and interact with others.’ (Al Futtaim, 2017). It is an environment where profits increase and public demand increases alongside, whilst satisfying all parties. On the other hand, Halliburton’s approach ‘To achieve superior growth and returns for our shareholders by delivering technology and services that improve efficiency, increase recovery, and maximize production for our customers’ (Halliburton). The difference is prominent in priorities. For Halliburton, the stock holder theory is put first. Yet, it is clear that it has drenched its name in the ground. Prioritizing shareholders solely has put Halliburton in great jeopardy that could have been avoided. As the economist Milton Friedman famously stated in 1970: “The business of business is business”. Although this can be easily interpreted as a priority for profit; the shareholder theory is what truly insures long term success.

A business’ success is not determined by its net worth alone, but rather its global influence. It is rather important to keep in mind that businesses are not governments. They don’t solely serve society, but rather work hand in hand with it. Businesses are created in a structure where they can be regulated by governments to insure fairness from all aspects. It is too