10551 - 005 - 5493 - 2 Stakeholder Theory and Managerial Decision - Making : Constraints and Implications of Balancing Stakeholder Interests ©

Stakeholder theory is widely recognized as a management theory, yet very little research has considered its implications for individual managerial decisionmaking. In the two studies reported here, we used stakeholder theory to examine managerial decisions about balancing stakeholder interests. Results of Study 1 suggest that indivisible resources and unequal levels of stakeholder saliency constrain managers' efforts to balance stakeholder interests. Resource divisibility also influenced whether managers used a within-decision or an across-decision approach to balance stakeholder interests. In Study 2 we examined instrumental and normative implications of these two approaches. We conclude by considering the contributions of this research.