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In the last decades of the 20th century, the word "stakeholder" has evolved into a term of art in the field of business management: In discussing the decision-making process for institutions -- including large business corporations, government agencies and non-profit organizations -- the concept has been broadened to include everyone with an interest (or "stake") in what the entity does. That includes not only its vendors, employees, and customers, but even members of a community where its offices or factory may affect the local economy or environment. In that context, "stakeholder" includes not only the directors or trustees on its governing board (who are stakeholders in the traditional sense of the word) but also all persons who "paid in" the figurative stake and the persons to whom it may be "paid out" (in the sense of a "payoff" in game theory, meaning the outcome of the transaction). The holders of each separate kind of interest in the entity's affairs are called a "constituency," so there may be a constituency of stockholders, a constituency of adjoining property owners, a constituency of banks the entity owes money to, and so on. In that usage, "constituent" is a synonym for "stakeholder."

A major debate has begun about whether the firm should be managed for stakeholders, stockholders or customers. Those who support the stakeholder view usually base their arguments on three key assertions.

1) Value can best be created by trying to maximize joint outcomes. For example, according to this thinking, programs that satisfy both employees' needNeeds refer to things that people "must" have. They are often contrasted with wants which are more discretionary. The most widely known academic model of needs was proposed by Abraham Maslow. In it, he proposed that people have a hierarchy of needs, whichs and stockholders' want s are doubly valuable because they address two legitimate sets of stakeholders at the same time.

2) They also take issue with the preeminent role given to stockholders by many business thinkers. The argument is that debt holders, employees, and suppliers also make contributions and take risks in creating a successful firm.

3) These normativeIn positivist philosophy, normative is contrasted with its antonym, positive when describing types of theories, beliefs, or statements. A positive statement is a falsifiable statement that attempts to describe ontology. A normative statement, on the other arguments would matter little if stockholders had complete control in guiding the firm. However, many believe that due to certain kinds of board of directorsA board of directors is a group of individuals chosen by the stockholders of a company to promote their interests through the goverance of the company. Board members in most legal jurisdictions have specific fiduciary duties, whereby they act for the bene structures, top managers like CEOs are mostly in control of the firm.