Major stakeholders of a Business and How Business firms responsible for them
Stakeholders are the people or groups who are connected to a business and are affected by its actions. These stakeholders can be inside the business (internal) or outside of it (external). Here’s a simple explanation of the major stakeholders and how businesses are responsible for them:
1. Owners and Shareholders
Who they are:
Owners are the people who own the business.
Shareholders are those who invest money in the business by buying shares.
Responsibilities:
- Businesses must make profits to give them good returns on their investment.
- Share clear and honest information about how the business is doing.
- Run the business ethically and avoid risks that could harm their interests.
2. Employees
Who they are:
People who work for the business and help it run smoothly.
Responsibilities:
- Pay fair salaries and provide a safe and healthy workplace.
- Offer job security, training, and opportunities to grow.
- Treat employees with respect and fairness, and support their well-being.
3. Customers
Who they are:
People who buy products or use services from the business.
Responsibilities:
- Provide high-quality, safe, and reliable products or services.
- Charge fair prices and give good customer support.
- Be honest in advertising and protect customer information.
4. Suppliers
Who they are:
Businesses or individuals who provide the goods, materials, or services a company needs to operate.
Responsibilities:
- Pay suppliers on time and deal with them fairly.
- Build strong relationships and avoid taking advantage of them.
- Work with suppliers who follow ethical and sustainable practices
5. Government and Regulators
Who they are:
Authorities that create and enforce laws and regulations for businesses.
Responsibilities:
- Follow all rules, including paying taxes and meeting safety standards.
- Operate honestly and avoid illegal practices.
- Support economic growth by creating jobs and investing in the community.
6. Local Communities
Who they are:
People who live near where the business operates.
Responsibilities:
- Protect the environment and avoid disturbing local life.
- Create jobs and support the community through projects like schools or healthcare.
- Contribute to the local economy by working with nearby suppliers or services.
7. Environment
What it is:
The natural surroundings that the business impacts.
Responsibilities:
- Reduce pollution, waste, and use of natural resources.
- Use eco-friendly practices like recycling or renewable energy.
- Protect wildlife and support efforts to preserve nature.
Businesses depend on their stakeholders to succeed, and in return, they have a responsibility to treat them fairly and respectfully. By meeting the needs of their stakeholders, businesses can build trust, grow sustainably, and make a positive impact on society.