1.4 Stakeholders

Stakeholders are individuals or groups that affect or are affected by the actions of a business.

Internal stakeholders are individuals or groups inside a business: They include:

• Employees
• Owners (shareholders)
• Managers

External stakeholders are groups or individuals outside of a business, but have direct interest or involvement in the organization

• Customers
• Suppliers
• Local community
• Government
• Pressure groups

Stakeholders, independent if external or internal, have different objectives.

Stakeholder conflict

An organization is not able to meet all of its stakeholders' objectives simultaneously due to the different needs of each group/stakeholder.

e.g. The shareholder objective may be profit, but this can only be made possible if you cut staff salaries. This creates a conflict of interests.