Stakeholders

DO NOW Page 71 Tata Nano Divides Opinion answer all questions at the top of page 72.

Stakeholders – Brain Storm Who are the major stakeholders within a business?

Stakeholders People or groups of people who can be affected by, and therefore have an interest in any action by an organization. Businesses have responsibilities to a wide range of people not just shareholders.

Who are the Stakeholders? Customers Suppliers Employees Local Community Government Shareholders

Activity In Groups I want you two come up with all the roles and rights for the different stakeholders, we will discuss once completed.

Customers - Roles Purchase Goods and Services Provides Revenue from sales which allows the business to expand.

Customers - Rights To receive goods and services that meet quality standards. To be offered replacements or repairs to faulty products as per the law.

Suppliers - Roles Supply goods and services to allow the business to offer its products to its own customers.

Suppliers Rights To be paid on time, as per the law or agreed contract. To be treated fairly by the purchasing business. (not being coerced into lowering there prices)

Employees - Roles To provide labour to ensure goods and services are provided for the customers.

Employees - Rights To be provided with the appropriate working standards as per the countries law. To be paid and have a safe working environment as per there individual employment agreement. To be able to join a trade union.

Community - Roles Provide local services and infrastructure to the business to allow it to operate, produce and sell within legal limits.

Community - Rights Businesses are expected to not effect the community in negative ways through there existence. To be consulted about major changes that could affect the community.

Government- Roles Pass laws that restrain many aspects of business activity. Provides law and order to allow legal business activity to take place. Achieves economic stability to encourage business activity.

Government - Rights Business are required to meet all legal constraints. I.e. producing and selling only legal goods and paying taxes.

Role Play Stake holders – for the rest of the period.

Homework Outline the responsibilities the warehouse has to their stakeholders? (include all)

DO NOW Explain the roles and responsibilities of three stakeholders?

Responsibilities to Stakeholders To the customer – Satisfying the demands of your customer is essential to long term success. Ensuring quality, design, durability decisions are made with customer in mind. Don’t take advantage of customers, don’t break the law ensure all products are what they say they are.

Responsibilities to Stakeholders To Suppliers – Pay promptly, place regular orders and offer long term contracts. Having reliable suppliers will result in confidence for your customers, and in some case better prices if the competition starts attacking your client base.

Responsibilities to Stakeholders To employees – there are legal requirements, but it is important to remember the success of most companies hinges on good employees, so retaining them through a good working environment, training, decisions and wages above the minimum should be taken into account.

Responsibilities to Stakeholders To the community – businesses offer secure employment, spending on local suppliers and protecting the local environment. To the Government – Meet all legal responsibilities, seek export markets and pay taxes on time.

Corporate Social Responsibility Video - Starbucks

CSR Why Should companies be social responsible? Different to social enterprises. CSR – requires businesses to consider the interests of society beyond the legal requirements.

CSR There has been a lot of debate on this as critics argue businesses are designed to make profit also businesses only use it to make them look better to society. In the short run it will mean reduced profits. What about the long run? Should business be responsible for the ethics of there suppliers? Or other governments?

Social Audit This is the new thing in business to report on how socially responsible you are its not a legal requirement yet. The report often includes information on your health and safety, sustainable use of products, reduction of hazard chemicals and pollution and contribution to the community.

Benefits of a Social Audit Identifies what social responsibilities the business is meeting. And what still needs to be achieved. Sets targets for improvement in social performance by comparing these audits with the best performing firms in the industry. Improves a companies public image and this will help to act as a useful marketing tool to increase sales.

Limitations of a Social Audit If the Social audit isn't independently checked – as published accounts must be. Will it be taken seriously by stakeholders? Time and Money was devoted to producing a detailed social audit – is it necessary if its not a legal requirement? Many consumers may just be interested in cheap goods – not whether the business they buy them from are socially responsible or not.

Stakeholders Can a business satisfy all stakeholder groups? What would be the extra cost of meeting the needs of each stakeholder group? There will always be a need to make a compromise, as you cant satisfy everyone often this may result in a loss of profit and these decisions need to be made by management.

Activity Community based development projects page 78 Activity 5.4 Questions 1-4