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Business Studies- Unit 1- Stakeholders

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Introduction

´╗┐Daniel Hardman. A04- Stakeholders The fundamental definition of a stakeholder is a person, group or organisation that is affected or can affect a business or organisation?s actions, beliefs or objectives. There are two main types of stakeholder- internal and external. The title of ?Stakeholder? is usually a title given by the stakeholder them self, although all stakeholders are affected by and affect an organisation in different strengths and in completely different ways. As the name suggests, internal stakeholders are those that work within the business and are benefited by such factors as profitability and stability. Examples of this type of stakeholder include employees, managers and directors. The first internal stakeholder that I will explore is the employee. Employees are individuals that are employed to work for either a single person or whole organisation under a contract of employment. A contract of employment can be written, oral, implied or expressed but is always the terms and conditions in which an employee must work under to receive an agreed salary or wage. In every contract of employment, it is always agreed that the employee is obliged to carry out allocated tasks and assignments to his/her best ability. On the side of the employer, there is always the obligation to protect his/her employee from harm and to compensate their employee with an equal compensation for any work-related harm which may occur to the employee. It is most definitely within the interests of the employee to make sure that his/her employer follows the terms and conditions of the contract of employment and also within the interests of the employer for the employee to follow the terms and conditions of their contract of employment. Although the main interest of an employee is to earn the highest salary possible, the factors that cause his/her employer to pay their employees highly are much more complex than mere choice. If the employee?s business is not profitable, there is very little chance of pay rises, long holidays, a large number of authorised sick leave and promotion occurring. ...read more.

Middle

The local community of Coca Cola Wakefield will also be interested in the environmental protection methods in which Coca Cola Wakefield are using to make sure that the surrounding area of Coca Cola Wakefield is not polluted or smoggy. Coca Cola Wakefield have certainly pleased such interests as these by introducing their ?Monitoring and Targeting? system which, as aforementioned, has significantly lowered energy consumption by 16.5%, also the use of a wind turbine to produce energy for the factory means that less pollution is being caused by the business. The local community of Coca Cola Wakefield are also interested in such irritations as noise pollution and the hours in which the factory manufactures in. For example, if the factory was to work all the way through the night, this could cause uproar in the local community as this could cause lack of sleep or just disturbances. Truthful communication is another vital agreement in which the local community are interested in keeping- as if Coca Cola Wakefield were to lie about new business ventures, suspicion and distrust will surely arise between the two parties. SOURCE: cokecce.co.uk/about-us/sites-and-offices/wakefield.aspx Conflict most certainly arises between the shareholders and local community of Coca Cola Wakefield. It is certainly in the interests of Coca Cola Wakefield to please its local community to avoid protest or revolt, though the ways in which this is done come as quite a hindrance to the business. Shares of the business, which are desired by a lot of the local community, will mean that the before shareholders will receive a lower dividend of the profits of Coca Cola Wakefield. Involvement of the local community (which is one of the local community?s interests) in new ideas and business ventures could also have a hindering effect on the profitability of Coca Cola Wakefield as such ventures as expansion of the factory, which could benefit the business greatly, could perhaps not go forward if the local community do not agree with it. ...read more.

Conclusion

as the investors in Dragon?s Den; who are external investors that invest into high-risk businesses seen as too risky for banks to loan to- also commonly giving managerial expertise into the business for, due to the fact that the businesses that have been invested by venture capitalists are commonly small at the time of investment, for quite a large percentage of the business ownership. The interests that financiers of a business such as Coca Cola Wakefield have are the profitability and growth of the business- this is because if the business was not to be profitable after the investment from the financier, it may not be possible for Coca Cola Wakefield to pay the loan back on time. The reason as to why many financiers are interested in the growth of the business in which they have invested in is because; if the business was to grow further, larger and therefore more profitable loans to the financiers may be asked for in the future. With regards to venture capitalists however- they are particularly interested in the growth of the business that they have invested in because they own a percentage of the business and want a percentage of the business? profit capital. Conflict of interests arises between financiers and managers as managers are interested mainly in the profitability of the business and therefore want the financier taking as little of the total profit capital as possible. The financier however, is interested in taking the largest percentage of Coca Cola Wakefield?s total profit capital as possible and would like the return payment paid back as quickly as possible. In addition, if Coca Cola Wakefield was to propose to a bank for a large investment to expand the factory premises and the bank did not see this venture as profitable, they may simply refuse to loan the money- resulting in perhaps a lack of growth for the business which is definitely not in the interests of a manager working within Coca Cola Wakefield. ________________ | Page ...read more.

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