how to control stakeholders
Introduction
Since we need to figure out the affection of stakeholders to an organisation, we should firstly take into consideration about the category of stakeholders and consecutively find out what do these individuals and groups enforce to influence organisations’ activities. Subsequently, we will also acknowledge what could organisations do to understand and control stakeholders.
Classification of stakeholders
We assume that the organisation we are talking about is a firm. So that we can separate the parties involved with a firm into at least three groups (R. E. Freeman & J. McVea, 2001). These groups are the capital market stakeholders (shareholders and the major suppliers of a firm’s capital), the product market stakeholders (the firm’s primary customers, suppliers, host communities, and unions representing the workforce), and the organizational stakeholders (all of a firm’s employees, including both nonmanagerial and managerial personnel)(R. Duane Ireland, Robert E. Hoskisson, and Michael A. Hitt, p20-21).
In most cases, shareholders - individuals and groups who have invested capital in a firm in the expectation of earning a positive return on their investments are the most obvious stakeholders. Rights of these stakeholders’ are grounded in laws.
In contrast to shareholders, the firm’s customers prefers that investors achieve the lowest return on their investments. In that high returns to shareholders of capital market might lead to lower returns negotiated with customers.
How capital market stakeholders could affect a firm and its activities
As we all known, shareholders and lenders will invest a firm, which can increase their wealth, and they’re always willing to take risks when doing investments. Shareholders can use stock market price signals to continually monitor management performance (SUDARSANAM, S. and BROADHURST, T., 2012). If the firm creates more risks, shareholders and lenders will be dissatisfied. Therefore, shareholders and
Since we need to figure out the affection of stakeholders to an organisation, we should firstly take into consideration about the category of stakeholders and consecutively find out what do these individuals and groups enforce to influence organisations’ activities. Subsequently, we will also acknowledge what could organisations do to understand and control stakeholders.
Classification of stakeholders
We assume that the organisation we are talking about is a firm. So that we can separate the parties involved with a firm into at least three groups (R. E. Freeman & J. McVea, 2001). These groups are the capital market stakeholders (shareholders and the major suppliers of a firm’s capital), the product market stakeholders (the firm’s primary customers, suppliers, host communities, and unions representing the workforce), and the organizational stakeholders (all of a firm’s employees, including both nonmanagerial and managerial personnel)(R. Duane Ireland, Robert E. Hoskisson, and Michael A. Hitt, p20-21).
In most cases, shareholders - individuals and groups who have invested capital in a firm in the expectation of earning a positive return on their investments are the most obvious stakeholders. Rights of these stakeholders’ are grounded in laws.
In contrast to shareholders, the firm’s customers prefers that investors achieve the lowest return on their investments. In that high returns to shareholders of capital market might lead to lower returns negotiated with customers.
How capital market stakeholders could affect a firm and its activities
As we all known, shareholders and lenders will invest a firm, which can increase their wealth, and they’re always willing to take risks when doing investments. Shareholders can use stock market price signals to continually monitor management performance (SUDARSANAM, S. and BROADHURST, T., 2012). If the firm creates more risks, shareholders and lenders will be dissatisfied. Therefore, shareholders and
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