Types of stakeholders
Internal and external stakeholders
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Internal stakeholders may have different objectives and level of risk. Examine the chart below:
| Stakeholder | Objective | Risk |
|---|---|---|
| Shareholders (may be companies not people) | Dividend income | Small, if investment is part of the portfolio of shares owned. |
| Directors - executive |
Income and power |
Higher, but may have many directorships, and savings. |
| Directors - non-executive | Many, depending why they are there. Gives some income. | May well be small, smaller than that of executive directors. |
| Managers | Income | Higher than Directors but lower than that of workers. |
| Workers | Continuation of job. Earnings to pay the cost of living | High. No job = no income. Jobs may be hard to get. |
The diagram below may help with remembering all the different stakeholders.
Figure 1 Stakeholders - internal and external
This model can be a useful plan when answering questions.
Remember, stakeholder questions usually boil down to 'it all depends'. It all depends to which stakeholder group the individual belongs.
Some food for thought
There are many groups who are stakeholders inside and outside of a firm who have an interest in its operation, and obviously its survival.
Have we reached a state where the interests of some stakeholders are becoming dominant, and even unfair? For instance, should shareholders interest be dominant or should firms be more sensitive to the roles and responsibilities it has in the society and the area in which it operates?
Why not try the following questions to check you are sure about internal and external stakeholders?
1 |
Internal and external stakeholdersMatch the following stakeholders to their status as either internal or external stakeholders. |
2 |
Internal and external stakeholdersMatch the following stakeholders to their status as either internal or external stakeholders. |
3 |
Internal and external stakeholdersMatch the following stakeholders to their status as either internal or external stakeholders. |
