Business stakeholders

Passing your examination!

In the written examination for this Unit, you will need to be able to demonstrate your knowledge and understanding of the following assessment criteria:

1.4.1 Internal stakeholders

You will know and understand the internal stakeholders of a business and their needs, including:

  • Employees
  • Managers
  • Owners
  • Workers

1.4.2 External stakeholders

You will know and understand the external stakeholders of a business and their aims and objectives, including:

  • Customers
  • Suppliers
  • Shareholders
  • Local community
  • Government
  • Finance providers

You’ll find lots of useful information on the following pages to help you complete this part of your examination.

Think first

Do you know what a stakeholder is? Type some ideas in the box below before you move on to learn more.

Click to read a definition of a stakeholder – did you get it right?

What is a stakeholder?

A stakeholder is anyone who has an interest in a particular business. This can be an individual person or a group of people. The stakeholders in a business can include people who work there, people who live in the local area, customers of the business and so on.

Stakeholders can have a significant influence on the business and its decision making.

Business stakeholders can be either internal stakeholders or external stakeholders. Let’s begin by learning more about internal stakeholders.

Internal stakeholders are those people who have an interest in the business because they are directly linked to the business – they are within the business.

Click through the slide panel below to see some examples of internal stakeholders.

  • Employees/Workers

    People who work for the business have a definite interest in the business. The business pays their wages as well as any additional benefits (such as pension payments, company car, etc), so members of staff will want to know that the business is performing well so they will continue to be paid and feel secure about their future employment. For this reason, members of staff have a very significant interest in the business and will be motivated to make sure it performs well.

  • Managers

    Managers are also members of staff in a business, so they will also need the business to perform well in order to continue to have their wages paid (and other benefits). However, the managers of a business will also have a responsibility to organise the business, manage staff and co-ordinate plans for the future. This can often involve making difficult decisions that could have a negative impact on other stakeholders – for example, moving a business operation overseas to reduce costs would lead to job losses and potentially poorer levels of customer service.

  • Owners

    The owners of a business are likely to be primarily focused on how much profit the business makes and how well it is performing financially.