Who stakeholders are
- A stakeholder is anyone with an interest in a business.
- Owners and shareholders want profit and dividends. Employees want good pay, job security and good conditions. Customers want quality, low prices and good service. Suppliers want regular orders and prompt payment. The local community wants jobs and little noise or pollution. The government wants taxes paid and laws obeyed. Lenders want to be repaid.
- Internal stakeholders are inside the business (owners, managers and employees); external stakeholders are outside it (customers, suppliers, the community, the government and lenders).
Conflicting interests
- Stakeholders often want different things. Owners want lower costs and higher profit, while employees want higher pay. A community may object to the noise of a new factory, even though it brings jobs.
How stakeholders influence businesses
- Shareholders vote at the annual general meeting (AGM); employees act through trade unions; customers can buy elsewhere; the government passes laws; and local communities can protest or object to planning applications.
Key terms
- Stakeholder
- Anyone with an interest in a business.
- Shareholder
- A person who owns shares in a company.
- Internal stakeholder
- A stakeholder inside the business, such as an employee.
- External stakeholder
- A stakeholder outside the business, such as a supplier.
- Conflict
- When stakeholders want different, incompatible things.
- Trade union
- An organisation that represents workers.
- AGM
- The annual general meeting, where shareholders can vote.