Shareholders vs stakeholders

Question 1

Define the term ‘stakeholder’.

Answer 1

A stakeholder is anyone who has an interest in the business, or who may be affected by the activities of the business.

Question 2

Define the term ‘shareholder’.

Answer 2

A shareholder is a person, business or organisation that owns at least one share of a company

A shareholder is a stakeholder of the business

Question 3

What are internal stakeholders?

Answer 3

A stakeholder is anyone that has an interest in the business and is affected by the actions of a business.
Internal stakeholders are those inside a business who may be affected by corporate decision making;

Employees
Managers
Owners

Question 4

What are external stakeholders?

Answer 4

External stakeholders are those outside the organisation who are affected by decisions made by the business.  These vary depending on the business and its location, but the main general ones are;
Customers
Competitors
Suppliers
Community groups (pressure groups)
Unions
Government

Question 5

Outline the steps of stakeholder mapping.

Answer 5

1-Identify the stakeholders of the business, these should be internal and external

2- Rank the stakeholder’s power either low, medium or high

3- Rank the stakeholder’s level of interest in the business; low medium or high

4- Rank the stakeholders value to the business; low, medium or high

5- Place all this information into a matrix (power, level of interest, value to business)

6- Draw a quadrant diagram with level of interest and power over decisions

Question 6

Analyse the different stakeholder map quadrants.

Answer 6

A: Stakeholders in this quadrant require minimal effort, and can be contacted using newsletters, mail shots and information on the company website

B: Stakeholders should be kept informed of corporate decisions and could be a potential supporter of the business in the future

C: Stakeholders should be kept satisfied, any communication should try to increase the level of interest in the business

D: Stakeholders in this quadrant are key players in the business and should be very involved in the governance and decision making and should be engaged with regularly