BBS 2044

BUSINESS & SOCIETY

GROUP : LILY

GROUP MEMBERS:

FARAH AINAA

NUR MASYITAH

RATHITHA DEWARAJAN

YASHNI YOGESWARAN

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Tutorial 1(2) - Discussion Questions

Stakeholders Management

In what ways stakeholders related to business activities. Give examples of stakeholders

Differentiate between primary and secondary stakeholders in a business situation. Give examples of each by selecting companies known to you.

Illustrate what are the examples around you from your observation or read where companies that act in irresponsible manner towards the society/stakeholders. Give examples

What opportunities and challenges does business encounter with the stakeholders in their day to day relationship?

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SUMMARY OF THE

CHAPTER3

Who are Business Stakeholders?4

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Business Stakeholder Groups

MediaSuppliersSpecial-Interest

Groups

SocietyGeneral

Public

CompetitorsCustomers Community

Stockholders Employees

Three Views of the Firm5

Production

View

Managerial

View

Stakeholder

View

Who Are Our Stakeholders?

Owner

Employees

Government

Customers

Community

Competitors

Social Activist Groups

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© 2012 South-Western, a part of Cengage Learning

What Responsibilities Does a Firm Have to

its Stakeholders?7

• What responsibilities does a firm have in its

relationships with all stakeholders?

• Responsibilities are

Economic

Legal

Ethical

Philanthropic

Principles of Stakeholder Management8

• Also known as the “Clarkson Principles”

Key words

Acknowledge

Monitor

Listen

Communicate

Adopt

Recognize

Work

Avoid

Acknowledge conflicts

1. IN WHAT WAYS

STAKEHOLDERS RELATED TO

BUSINESS ACTIVITIES. GIVE

EXAMPLES OF

STAKEHOLDERS

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In what ways stakeholders related

to business activities.

Internal stakeholders

are those who own or

work at the company,

including partners,

board members and

employees.

External stakeholders are

those affected by the

performance of a

business, including the

local city government,

community residents,

nonprofits a business

sponsors or donates to

and the trade media.

To understand who your company’s stakeholders are, divide

people affected by your company into three groups : internal,

external and connected stakeholders.

Internal stakeholders

External stakeholders

shareholders, vendors,

suppliers, retailers,

contractors, customers,

wholesalers, sales reps

and distributors.

Connected stakeholeder

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Give examples of stakeholders?

ownersemployees

customers

community

governments

Social activity groups

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2. DIFFERENTIATE BETWEEN PRIMARY

& SECONDARY STAKEHOLDERS IN A

BUSINESS SITUATION. GIVE EXAMPLES

OF EACH BY SELECTING COMPANIES

KNOWN TO YOU.

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Stakeholder

Primary Stakeholder is one who is affected directly by the performance of a company. Several parties considered to be a company's stakeholders are

Stockholders

Customers

Suppliers

Employees

Creditors

Secondary Stakeholder as people or groups not legally affiliated with a corporation but that affect or are affected by a corporation's actions.

Community

Competitors

Media

Society

General public

Special interest group

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Secondary

stakeholder

Ministry

of

healthMedia

Trade

union Parents

Other

interest

KFC

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3. ILLUSTRATE WHAT ARE THE EXAMPLES

AROUND YOU FROM YOUR OBSERVATION OR

READ WHERE COMPANIES THAT ACT IN

IRRESPONSIBLE MANNER TOWARDS THE

SOCIETY/STAKEHOLDERS. GIVE EXAMPLES?

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A. Wal-Mart

Often forced to work overtime for zero pay.

Deny its workers basic rights, spending an enormous amount of time and money keeping unions out including: $7,000 anti-union camera packages, $30,000 undercover spy vans, $100,000 24-hour anti-union hotlines and a $7,000,000 rapid response team with a corporate jet.

Pushes its suppliers to go lower and lower on their wholesale prices.

Broken one environmental law:

Fined for violating new standards for stormwaterrunoff in 2001.

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B. ExxonMobil

Well-known environmental offense.

Ranked sixth on the Toxic 100 list of US corporate air polluters.

In 2001, ExxonMobil target of a lawsuit by a human rights group that accused the company of actively abetting human rights abuses including torture, rape and killings in Indonesia.

The case is still pending until now (2009).

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C. Nestle

Most of the cocoa used in Nestle's products comes from the Ivory Coast, a country known for using illegal and forced child labor in the production of this commodity.

Aggressive marketing campaigns for their baby formula in developing and poor nations:

Company markets its formula under false pretenses.

Millions of liters of the substance were found to be contaminated with harmful chemicals.

Workers protest absurdly low wages and unsafe working conditions, they're simply fired and replaced with new workers.

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QUESTION 4

What opportunities and

challenges does business

encounter with the stakeholders

in their day to day relationship?

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STAKEHOLD

ERS

OWNERS

MANAGERS

EMPLOYEES

CUSTORMERS

SUPPLIERS

COMMUNITY

LENDERS

GOVERNMENT

SOCIAL ACTIVITY GROUP

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BUSINESS

STAKEHOLDERS

Primary stakeholder : Who are the

direct stake in the organization and its

success.

Secondary stakeholders : Have a public

or special interest stake in the

organization that is more indirect

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OPPORTUNITIES

-Build productive working relationship with

stakeholders

- The potential for cooperation

CHALLENGES

-Representative of how the firm handles its

stakeholders.

-The potential for threat.

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