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The stakeholder theory has been advanced and justified in the management literature on the basis oi its descriptive accuracy, instrumental power, and normative validity. These three aspects of the theory, although interrelated, are quite distinct; they involve diiferent types of evidence and argument and have different implications. In this article, we examine these three aspects of the theory and critique and integrate important contributions to the literature related to each. We conclude that the three aspects of stakeholder theory are mutually supportive and that the normative base of the theory^-which includes the modem theory of property rights-is fundamental. 65 Lee E. Preston received his Ph.D. from Harvard University. He is a professor of business and public policy in the College of Business and Management at the University of Maryland. His current research interests include international business-government relations.

This research note analyzes the relationship between indicators of corporate social and financial performance within a comprehensive theoretical framework. The results, based on data for 67 large U.S. corporations for 1982-1992, reveal no significant negative social-financial performance relationships and strong positive correlations in both contemporaneous and lead-lag formulations.

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