Diversity management and stakeholder value?

In University I have heard quite a lot about different objectives of corporate strategy and diversity management, but not in the same context. But why not, both are essentials in todays business world.

The origanal theory was once  introduced by Alfred Rappaport. According to De Wit & Meier the shareholder value approach aims to maximize wealth for the shareholders of the company – which in fact is simply about increasing the share prices and dividends. In contrast to that Robert Edward Freeman argues in his book “Strategic Management” that the stakeholder value approach aims to increase the wealth of all stakeholders of the company. Thereby profits have less value that to take over responsibility for the different participating groups such as shareholders, managers, employees and many more.

That was a small introduction to the shareholder/ stakeholder value approach. But where is now the problem to so popular term diversity management??

In the book “The psychology and management of workplace diversity” Rosemary Hays-Thomas defines the diversity as the “differences among people that are likely to affect their acceptance, work performance, satisfaction, or progress in an organization”. I also found another really cool definition by the German green party which is obviously political correct (http://tinyurl.com/Diversity-Green ). However, in the end the aim of diversity management to maximize the companies success by still satisfying the employees requirements and wishes

Right, so why am I am talking about that?

On the first view it seems to be that there are not many differences between the objectives of the stakeholder value approach and diversity management. Both are obviously aim to increase the company’s success.

But the definition of success and the way to achieve may be different like everywhere else. Shareholders don’t care about the way as long as the profits are acceptable. Different Employee groups may have different expectations to the company. For example women may look for a children friendly employer (http://tinyurl.com/women-motives) or Muslims may look for a company which except their religious rituals such as Ramadan. Build on this, the satisfaction will define the determination to go hand in hand with the company goals and therewith the company’s success.

Just check out Deutsche Lufthansa or Shell for example. They are having huge diversity management programs and try to say that they are a cool employer. But in the end, they don’t really care about their people. It’s still all about maximizing profits! And where is the moral of the story??

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Comments
3 Responses to “Diversity management and stakeholder value?”
  1. katjo2010 says:

    Thank you for this interesting post and showing a bigger picture, as diversity management affects one specific stakeholder group, the employees.
    You are right, in the end the aim of diversity management is maximizing the company’s success. But I think it should be emphasized that the success can be even bigger by including different stakeholders rather than just satisfying their requirements or obeying laws.
    Regarding your bad examples, I believe it can’t be judged that easily. Managing diversity and establishing a corresponding corporate culture takes time, as all changes do. And sometimes there are set backs.

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