Business stakeholders

• A stakeholder is any person, group, or organization that has an interest in the activities of a business
• Businesses need to be aware of their stakeholders as they can be affected by its activities and also influence the decisions that a business makes
• Internal stakeholders work within a business, making or carrying out decisions, while external stakeholders are not part of the business but are affected by its activities
• There are eight main types of stakeholders:

  • Shareholders and owners
  • Managers
  • Employees
  • Customers
  • Suppliers
  • Local community
  • Pressure groups
  • Government
• Shareholders in a public limited company (PLC) influence the business’ aims, objectives, and strategic activities, while in a limited company (LTD), they make business decisions needing agreement from other shareholders
• Managers are responsible for implementing decisions made by owners and overseeing the required work
• Employees carry out the day-to-day work of the business
• Customers are individuals who buy products or services from the business
• Suppliers are other businesses or organizations providing products or services to the business
• The local community includes people, organizations, and businesses living or located around the business
• Pressure groups are formed by people sharing a common interest related to the business, advocating for that shared interest
• The government receives tax payments from the business
• Business stakeholders are individuals or groups with an interest in the activities of a business
• Stakeholders can influence a business's decisions and be affected by its activities
• Different stakeholders have different expectations from a business, leading to potential conflicts
• Examples of stakeholder priorities:

  • Shareholders and owners: interested in the business's success and profit
  • Managers: seek good salary and career progression opportunities
  • Employees: desire good pay, job satisfaction, security, and career growth
  • Customers: want quality products at reasonable prices
  • Suppliers: expect timely payments and regular orders
  • Local community: may seek job opportunities from local businesses
  • Pressure groups: aim to influence business activities in line with their causes
  • Government: aims for job creation to increase tax revenue and reduce benefit payments
• • The government may be pleased with new job creation but other businesses could lose customers, affecting their profits and tax payments
• Stakeholders in a business can be affected in various ways by the business activities:

  • Shareholders may expect sales to increase over time but opening a new store could affect short-term profits and dividends
  • Managers take on additional responsibilities and set new targets, impacting their career progression and motivation
  • Employees benefit from increased job security and opportunities for promotion, but some may feel resentful if not offered opportunities
  • Customers benefit from more shopping choices, but some may remain loyal to existing businesses
  • Suppliers benefit from increased orders but risk losing business if they can't meet demand
  • The local community benefits from new jobs but may be unhappy with increased traffic or noise
  • Pressure groups may protest against new stores if they feel negatively impacted
• Stakeholders in a business can influence and be affected by its activities:

  • Shareholders and owners have the most impact, making decisions about the business and providing funding
  • Managers make recommendations and decisions that influence business activity
  • Employees may have limited influence but can affect the business directly
  • Customers provide feedback and can influence others by recommending or warning against the business
  • Suppliers can significantly impact a business through changes in quality or reliability
  • The local community can protest or support businesses
  • Pressure groups can improve working conditions and influence customer opinions
  • Governments can pass laws or change tax levels affecting businesses
• Shareholders and owners have the most influence on the activities and objectives of a business
• Business stakeholders are any person, group of people, or organization that has an interest in the activities of a business
• Stakeholders can influence the decisions that a business makes and may want different things from a business, leading to potential conflicts between them
• Conflict between stakeholder groups in a business can arise due to disagreements over decisions made by the business that affect them
• Overcoming conflicts between stakeholders often requires negotiation and willingness to compromise
• An example of conflict: Owners of a retail business decide to extend opening hours, causing potential conflicts with managers, employees, customers, suppliers, the local community, pressure groups, and the government