A stakeholder is an individual, or one of group, whose interests are directly affected by the activities of a firm or organization. They may be dependent on the organization, or exert some kind of influence over it. In other words, they have varying degree of power.
Three key shareholders (spot 'reasons')
1. Managers and other employees of a company are appointed to look after the daily activities of the company. They need information, for example about the company's finacial situation, and they need to be able to work effieciently and make effective decisions using their own knowledge and skills. Empoyees are also inerested in information about the company because their careers are dependent upon it.
2. Trade contacts include suppliers of goods to the company, and customers who purchase the goods or services on offer. Suppliers need to be assured that the company can pay its debts according to any contractual terms. Custores need to be sure that company is a secure source of the goods and services that they need.
3. Providers of finance to the company might include a bank which allows the company to operate on overdraft, or which grants a loan. The bank want to ensure that the company is able to meet its repayments. Shareholdrs of the company also want to assess how well the management is performing, as they are the owners and provide some of the finance. They will have their own expectations for capital growth and dividend income.
Key external environmental influences on an organisation and its stakeholders
A useflu model for environmental analysis uses the acronym PESTEL. This analysis the external environment into 6 categories, shown here with some indication of the areas that they cover.
(spto 'influences')
1. Political - regulatary influences, such as government policy on infrastructure
2. Economic - important at local and national level, and including incluences such as inflation, interest rates and government spending.
3. Social - demand profiles, ethnicity, family structures, age and population growth
4. Technological - this influences the way in which products are made, bought and sold.
5. Environmental/ecological - pressure groups and 'green' concerns, such as pollution control
6. Legal - a general framework for the conduct of business, varying from contry to contry
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