2. Stakeholders
Stakeholders: People/groups with an
interest in the success of a business
Stakeholders may be either internal or
external to the organisation.
On certain issues, stakeholders may share
common concerns, while on others they may
not
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3. Managers
Suppliers
Shareholders
Employees
Stakeholders include…
Customers
Local
Community Pressure Groups
Government
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4. Shareholders
Invest money into the business
Want to make money from the business
Interested in the company making a profit
Want a good dividend
Want their shares to increase in price
The firm to achieve a positive corporate image and
long-term growth in order to create favourable
conditions that will encourage share prices to
rise.
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5. Managers
are stakeholders
They want the company to succeed
Better chance of promotion
Successful company may reward them by
paying them higher salaries
Giving them a bonus
Better fringe benefits
If company fails they could lose their job
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6. Employees
are stakeholders
Want the company to succeed
More likely to get better pay
Chance of promotion
Better facilities
A failing company will
Threaten their jobs
Freeze their pay
Possibly cut their wages
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7. Customers
are stakeholders
Customers have a stake in any
business which they buy goods and
services from
They want low prices
Best quality available
Good service
Innovative products
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8. Suppliers
are stakeholders
Want the company to succeed
More orders for them
More success for their business
Failing company
Falling orders for them
Less profit
Job losses
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9. Business has an impact on
the local community
In the close vicinity of a business
Creates jobs for people living locally
The local area will suffer if a business fails
and is a large employer
Business might buy from local suppliers
Provide a service to local people or
businesses
It could pollute the local environment
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10. The Government
is a stakeholder
When a business succeeds
Business pays taxes – the more profit the
business makes the more taxes it pays
Provides employment and training
If a business fails
Workers are made unemployed
Government will have to pay them
unemployment benefit
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12. Stakeholder objectives
examples
Customers: value for money, good service,
quality
Owners/shareholders: maximising return
on investment
Managers: status, performance bonuses
Employees: high wages, conditions of work
Suppliers: to sell a lot at a high price, repeat
orders, customer loyalty
Pressure groups: to force a reduction of
environmental impact
* 12
14. Stakeholder conflict
Owner v customer: Profit v service
e.g. conflict over opening hours
Shareholder v worker: Profits v high wages
Owner v management: “Divorce between
ownership (profits) and control”
i.e. The owners have little power over managers
Employer v employee
Employees see their hard work reflected in higher
profits for the employer
Employers look for greater efficiency – more
output for lower costs
* 14
15. Internal and External
Stakeholders
Internalstakeholders are those who are
„members‟ of the business organisation,
external stakeholders are not.
Can you categorise the stakeholders
into the relevant group?
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16. BUT!
Some groups can be both internal and
external stakeholders
Such as staff or shareholders
who are also local residents
Can you think of any others?
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