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Stakeholders are persons or organizations that are affected or influenced by the activities of a company. These include, among others, customers, suppliers, employees, investors or society as a whole. The word stakeholder is derived from the English verb “to stake”, which means something like “to stake”. In a business context, it thus means that someone “stakes” something in a company, such as time, money or labor. In 1984, Freeman introduced the stakeholder concept into the strategic management literature in his book of the same name: A Stakeholder Approach. In it, he defined a stakeholder as “any person or group that can influence the objectives of a company or be influenced by the company's actions. This definition was further developed and refined by numerous authors in the following years. In more recent publications, stakeholder is often described as “any party that depends on the continued existence and actions of the company or is influenced by it.”
The goal of every company should be to satisfy all of its stakeholders. Only in this way can the company be successful in the long term. However, this is often easier said than done, as the interests of the individual stakeholders often conflict with each other. A typical example of this is the situation in which customers want a product at the lowest possible price, while the company wants to make a profit. In such cases, the company has to find a compromise that satisfies both sides. [1]
Stakeholders may have economic, social or ethical interests. The number of stakeholders in a company varies depending on the industry and the area of business. [2]
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The importance of stakeholders is undisputed. They are the ones who keep the company alive and move it forward. The importance of stakeholders thus lies in the fact that they can significantly influence the success or failure of a company. They are therefore not only "affected parties" of the company, but also "actors" with their own interests, motives and goals. In practice, it can therefore be quite difficult to take into account the interests of all stakeholders and be successful at the same time. It is therefore necessary to perform a balancing act: On the one hand, the interests of the stakeholders must be taken into account; on the other hand, the company must not lose sight of its own goals. A well-known example of this is the discussion about climate protection. Many companies are now facing pressure to make their products and services more climate-friendly, or even to produce them in a climate-neutral way. At the same time, however, they are also under financial pressure, since climate-friendly production is often more expensive than conventional production. So both the companies themselves and their stakeholders find themselves in this area of tension - and a compromise must be found. Stakeholders are crucial to the success or failure of a company. They have a decisive influence on how successfully the company operates and what direction it takes. At the same time, however, they also pose a challenge, as their interests are often complex and contradictory. It is therefore necessary to find a balancing act between the interests of the stakeholders and the company's own goals. [3]
A stakeholder is a representative of an organization or project. This person can be directly or indirectly affected by the development. A direct stakeholder is a person who is directly affected by a decision or action. An indirect stakeholder, on the other hand, has no direct influence on the decision or action, but may still be affected. Stakeholders are individuals, groups, or organizations that have a direct interest in a project or organization. They can benefit or be affected by the project's results in a direct or indirect way. There are many types of stakeholders and it is important to understand who they are and what their needs may be.
Stakeholders are typically categorized into internal stakeholders (people working within the company or project) and external stakeholders (stakeholder groups outside the company, such as investors). Internal stakeholders are those who are part of the business unit, team or department in which the project is taking place. External stakeholders include customers, suppliers and other parties outside the organization. [4]
An important part of the stakeholder management strategy is to assign and distribute responsibilities. This also includes clear communication with all parties involved, as well as appropriate control over all actions related to the project. It is important for any business to hold regular meetings to keep all interested parties informed of the project's progress and to solicit feedback. This also allows the company to respond efficiently to any change requests and adjust its plans accordingly. It is important to understand that each stakeholder has different concerns and therefore you have to try to resolve the conflicts of interest between the various parties so that everyone is satisfied with the finalized result. Successful stakeholder management also enables companies to systematically obtain positive feedback from customers or other interest groups and to positively influence the company's reputation in public. [5]
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Stakeholders can be divided into different categories depending on the type of relationship they have with an organization or project. Some of the most commonly used categories are:
It is important to note that there are not just two categories of stakeholders. Many organizations make up a three category - potential stakeholders - providing a broad range of stakeholders that may be important to the company. Potential stakeholders could include suppliers and business partners, as well as specific industry representatives or political actors. It is critical for any company or project to be well-informed about all relevant groupings and understand their needs in order to be successful. This is the only way to develop and implement effective strategies that meet both the primary and secondary stakeholder groups to achieve long-term impact while doing everything necessary for the company's success. [6]
The role of stakeholders in companies is an important factor in determining the success of a company. Stakeholders' opinions and interests influence the company's strategic decisions and reflect the social and economic realities in which the company operates. The role of stakeholders can vary, depending on the company's industry and product.
Stakeholders play an important role in companies. They are the link between companies and their customers, suppliers, employees, investors and other stakeholders. By involving all these groups in a company, those who are connected to the company can make a valuable contribution to its success. Stakeholders can be involved in the company's development in a variety of ways. For example, they may suggest new products or help optimize existing products. They can also suggest new ideas and consider how to solve problems. Likewise, stakeholders often also influence how the company uses its resources and where it invests. One of the biggest challenges for companies is to ensure that all stakeholders are satisfied. It is therefore important that stakeholders are appropriately involved and that their needs are taken seriously. Negotiation processes should also be fair, and each side treated with equal respect. It is therefore advisable to find a good compromise that can make all parties happy. In summary, stakeholders play an essential role in the development and success of a company. It is therefore important that all stakeholders participate in the decision-making processes and find common solutions. Only in this way can a company be successful and remain in existence in the long term. [7]
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Stakeholders and shareholders are two groups that can be affected by a company's activities. Stakeholders are individuals or groups that are connected to an organization in some way and influence or are influenced by its decisions – both positively and negatively. These include, for example, employees, customers, suppliers, local residents, non-governmental organizations and competitors.
Shareholders are a specific subgroup of stakeholders. They are shareholders in a company and thus own property rights. Their main interest usually lies in the financial return, for example through dividends or price increases. However, there are also shareholders who, in addition to financial goals, value social or ecological aspects, such as impact investors or ESG-oriented investors.
One important difference between the two groups is their ability to exert influence: Shareholders have legally enshrined rights to a say, for example through voting rights at annual general meetings. By contrast, non-shareholder stakeholders have no formal corporate rights, but can exert influence in other ways, such as through public opinion-forming, negotiations with management or regulatory pressure.
For a company to be successful in the long term, it should consider the interests of both shareholders and stakeholders. A holistic management approach (e.g. stakeholder management) can help develop sustainable business strategies that align financial goals with social and environmental responsibilities. [8]
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[1] Oxford Handbook of Business and Society – Freeman et al., 2018, (Kap. Stakeholder Perspective).
[2] Gabler Wirtschaftslexikon – Stichwort „Stakeholder“, neueste Auflage (Print-Ausg. 2013, ISBN 978-3834905261)
[3] A Stakeholder Framework for Analyzing & Evaluating Corporate Social Performance – Clarkson, 1995, Acad. of Management Review 20(1), S.106.
[4] Technikum Wien Academy – „Was ist ein Stakeholder?“ (2021)
[5] Harvard Business Review (Online): “How to Manage Stakeholder Engagement”, 2019
[6] Interne vs. Externe Stakeholder – z.B. Lexware.de (Ratgeber) oder Technikum Wien Academy (2021)
[7] OECD Principles of Corporate Governance (2015)
[8] European Financial Review (2020): “Shareholder vs Stakeholder capitalism”
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