Stakeholder Theory of Corporate Governance - Explained

The video discusses the stakeholder theory, which expands the focus of corporate officers and directors beyond just the corporation and its shareholders to include all stakeholders. Stakeholders are defined as anyone with an interest in the corporation's success, including local communities, governments, and suppliers. The video emphasizes the importance of considering the interests of these third parties in corporate decision-making.

How does the stakeholder theory differ from traditional corporate governance?

What are the implications of considering third parties as interest holders in a corporation?