The aim of this paper is to identify, review and assess two prominent recent trends in the literature on stakeholder engagement. Scholars in the first camp are referred to as Habermasians, owing to their reference and adherence to the work of the German philosopher most famous for elaborating on the concept of moral discourse. To these scholars, moral engagement is marked by specific conditions of communication which ensure that this communication is uncorrupted by power differences and strategic motivations. Others – those called here Ethical Strategists – argue that the engagement of stakeholders must be integral to a firm's strategy if it is to achieve real success. This camp is characterized by scholars contending that the distinction between strategy and morality is not only unfortunate, but logically unnecessary. They hold that good strategy properly understood must encompass what are typically recognized as moral concerns, because the very purpose of the firm and the capitalist system within which it operates is, when viewed rightly, the creation of value for all stakeholders. While recognizing the important contributions made by the Habermasians to the conversation about stakeholder engagement, it is concluded that, owing to the confluence of conceptual and practical concerns, the Ethical Strategists' position is the more attractive.
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