ABSTRACT
Stakeholder has been a common word in managers’ and practitioners’ vocabulary since R. Edward Freeman published his landmark book in 1984. Since then, the concept has also been employed in the public sector domain as a means for depicting the sort of stake public organization actors are able to impose upon both administration and policies. As public organizations worldwide were very influenced by managerialistic thoughts over the last three decades or so, managers increased the adoption of practices that focused rather on efficiency than effectiveness. Due to the importance of the understanding of the environment upon decision-making, other theories of resource dependence, institutionalism, advocacy coalition framework, social network, agency theory, urban regime theory, so on and so forth were adopted. In this chapter we present evidence collected from local government organizations through case studies in order to ascertain the importance and depiction of a whole set of stakeholders capable of influencing the decision- and policy-making processes within public organizations. At the end of the chapter, we provide evidence on the utility of a model constructed to reduce the complexity of stakeholder identification and engagement for public organizations. Focusing on the governance concept we contend that public managers need to engage in relationships with stakeholders as the only way to make public organizations more effective and local communities more engaged and proactive.
