KK3 & KK4: Stakeholders

types of stakeholders

•      Owners

•      Managers

•      Employees

•      Customers

•      Suppliers

•      General Community

Owners

• Primary interest is profit maximisation

• Concerned with their degree to which they can control the business

• Owners often start business so that they can maintain a sense of control

• Shareholders of PLC have an interest in profit so their value of their particular shares increase, of they receive a higher dividend

Managers

• Individuals who are responsible for successfully achieving objectives of the business

• Contemporary managers are also expected to be ethical and socially responsible in how they achieve business objectives

• Managers are interested in their remuneration and career progression within any organisation

• They need to achieve business objectives, but this needs to be done with careful consideration of stakeholders

Employees

• The people who work in a business

• Interested in remuneration, job security and career growth

• They want to be treated fairly and get trained to enable growth and career progress

Customers

• People who purchase products and services from a business

• They have many expectations:

  • Reasonable quality of products/services

  • Good customer service

  • Socially responsible behaviour

  • Responsiveness to their changing preferences

  • Low prices

Suppliers

• Provides a business with all the inputs and raw materials needed for production

• Suppliers are interested in being paid promptly and growth of the business so that they can continue to serve a business and grow themselves

General Community

• People who live close to and around the business, typically in the same geographical area

• General community expects businesses to provide value to the community in some way this could include providing employment opportunities, community projects and establish charities

• The community also expects businesses to behave in an environmentally responsible manner

• Ensuring that the general community is affected positively can enhance business reputation

examples of conflicts between stakeholders