Chapter5 Flashcards
Explain what is meant by the term stakeholder
A stakeholder is a person party with an interest in the success of a business.
Identify the internal and external stakeholders of a business
Internal stakeholders are found within the business and are the owners and employees, including managers and external stakeholders are suppliers, lenders customers, and the local community
Analyze the objectives of the stakeholders of a business
Allstate holders will benefit from a business success, but they may not do so equally.
Owners -a business may have a single owner, several or thousands, but they will want the best possible return on the money they’ve invested in the business and they want to see the business grow so that the returns increase
Employees -It’s not surprising they want the highest wage they can get a bonus if possible and job security, but they want the business to offer more than the legal entitlement to holiday pay and so on they would like manages to organize their work so that it’s challenging and provide job satisfaction
Customers -they want the best quality products at the lowest possible price
Suppliers -they would like to see its customers prosper so that it has a regular profit and it would like repeat orders rather than one off and hopes it’s customers will grow larger so that it can increase its own sales
Lenders -bank wants to agreed amount owned to it to be paid back at the agreed time and they don’t want to receive less than expected. They want their money back at the agreed time.
Community -the community is affected by business activity for example continual deliveries will cause congestion and pollution on the roads as well as noise pollution, which can therefore cause property prices to fall
Social costs -private costs to the firm+ external costs to society
Social benefits -private benefits to the firm+ external benefits to society
Government-Most people are employed as a result of a business activities, and the government will pay out less social security, benefits and receive increased tax revenue from the business and its employees
