Stakeholders

  • Stakeholders are individuals, groups or organisations that have an interest in or can be affected by the way a business operates. They can equally influence a business’ decisions and operations.

  • The main types of stakeholders are employees, customers, suppliers, shareholders, government, community and management. Each has different interests and expectations, which businesses need to consider when making decisions.

  • Employees seek good working conditions, fair remuneration and job security. Their influence can affect productivity, job design, recruitment strategies, and more.

  • Customers want high-quality products/services at reasonable prices. They can influence a business through their buying decisions and product feedback.

  • Suppliers seek reliable and regular orders, timely payment and strong working relationships. They can impact a business’ supply chain effectiveness and costs.

  • Shareholders are interested in earning a return on their investment. They can influence a business’ strategic and financial decisions.

  • The government’s interests lie in compliance with legal requirements, tax payments, employment embarking and businesses contributing to national economic growth. They can influence businesses through laws, regulations and policies.

  • The local community seeks employment opportunities, community development and minimal environmental impact. They can affect the business’ reputation and operational decisions involving environmental sustainability.

  • Management seek profit, market share, business growth and long-term business survival. They have the most significant influence as they make the final decisions on business operations and strategy.

  • Stakeholders can have both a direct and indirect impact on a business. Managers therefore need to balance these interests to avoid conflicts.

  • Stakeholder mapping is a tool used by businesses to understand the power and influence of their stakeholders and to manage their relationships effectively.

  • Effective stakeholder management can help a business maintain a positive reputation, enjoy smoother decision making, and foresee potential risks or issues.