shareholders VS stakeholders

Question 1

what is a stakeholder?

Answer 1

anyone who has an interest in the business, or who may be affected by the activities of a business

Question 2

what would a shareholder want from the business? (objective)

Answer 2

dividends

Question 3

what would customers want from the business?

Answer 3

high quality goods at cheap prices

Question 4

what would the local community want from the business?

Answer 4

jobs, investment in infrastructure, and good ethics

Question 5

what would managers want from the business?

Answer 5

they would want success and would want to be meeting aims for profit

Question 6

what would employees want from the business?

Answer 6

good pay/benefits

Question 7

what would suppliers want from the business?

Answer 7

on time payments, and long term contracts

Question 8

what would the government want from the business?

Answer 8

tax payment and creation of jobs

Question 9

what stakeholders are within a business?

Answer 9

• shareholders
• customers
• local community
• managers/owners
• employees
• suppliers
• government

Question 10

what influence do lenders have on the business?

Answer 10

they could influence the success of the business, as they could turn down a loan or increase interest rates. which could make raising money for the business more difficult

Question 11

what influence do customers have on the business?

Answer 11

the business’ success depends on demand and the sales of their product

Question 12

what influence do managers/owners have on the business?

Answer 12

poor communication could delay aims/ objective being achieved

Question 13

what influence do shareholders have on the business?

Answer 13

they influence the financing a business gets, and large investors could lead to a takeover

Question 14

what influence does the local community have on the business?

Answer 14

they could protest and create negative media attention

Question 15

what influence do employees have on the business?

Answer 15

if they’re not following what needs to be done, it could delay the aims that need to be reached, for example, customer service

Question 16

what influence do suppliers have on the business?

Answer 16

if they increase the price of supplies/quality decreases and they need to be reliable and ensure all goods are delivered on time

Question 17

what influence does the government have on the business?

Answer 17

they could increase tax payments, or they could increase, decrease or remove tariffs, and they can introduce new legislation (e.g sugar tax/wages)

Question 18

what are internal stakeholders?

Answer 18

stakeholders that work within the business, e.g managers and employees

Question 19

what are external stakeholders?

Answer 19

stakeholders outside a business that are interested in its activities, for example, customers, local community and suppliers

Question 20

what is the stakeholder approach?

Answer 20

when a business will take into account other stakeholders when making decisions for the business

Question 21

what is the shareholder approach?

Answer 21

when the business thinks about maximising profits in order to maximise dividends, only thinking about shareholders

Question 22

what could be a conflict between shareholders and employees?

Answer 22

employees: demand higher wages and better working conditions - comes at a cost for business
shareholders: demand more dividends - higher wages to employees would have a negative impact on dividends

Question 23

what could be a conflict between shareholder and customers?

Answer 23

if a business increases their prices, it would be good for the shareholders as they gain more dividends, but customers wouldn’t be happy as it would lead to them having to pay more - less purchasing power

Question 24

what could be a conflict between shareholders and directors/managers?

Answer 24

there could be conflict when managers begin to prioritise their own aims/objectives, like maximising renumeration over the interests of shareholders

Question 25

conflict between shareholder and government

Answer 25

tax evasion/avoidance and power