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IMPROVING RELATIONSHIPS BETWEEN
STAKEHOLDERS OF AN ACCA TUITION PROVIDER
Being a paper presented by Ayodele Samuel Olatiregun
at a 2-day seminar for Faculty Members and Staff held at
Collective College of Accountancy Ltd, EleyeleOn
July 4, 2009
Who is a stakeholder? CCA’s Major Stakeholders Stakeholder Theory Mendelow’s Stakeholder Power Mapping Classification of Stakeholders Improving Relationships between stakeholders Seven Principles of Stakeholder Management Feedback Conclusion
Content Outline
A stakeholder is any person or group of people with an interest in the success of a business.
Note that in this definition we have placed an emphasis on 'the success' of a business. This means that competitors are not included as stakeholders according to this definition because they have an interest in the business but not its success.
Who is a Stakeholder?
Who is a Stakeholder?
1. The Association of Chartered Certified Accountants (Nigeria and U.K.) = supplier
2. Lecturers = supplier3. Staff = employees4. Students = consumers5. Management = Management6. Shareholders = Shareholders In my current capacity as the Rector and major
shareholder, permit me to speak more as the Manager of the College rather than as a shareholder.
CCA’s Major Stakeholders
Business is permitted and encouragedby the law because it is of service to thecommunity rather than because it is asource of profits to its owners.”- E. Merrick Dodd
In other words, service to the community (academic, professional and general) is the primary purpose of our existence.
Stakeholder Theory
Mendelow’s StakeholderPower Mapping
A. Minimal Effort
B. Keep Informed
Level of Interest
Low
High
Pow
er
C. Keep Satisfied
D. Strategy must be acceptable
Low High
The two axes of Mendelow’s window arepower held and likelihood of showing aninterest in the organisation’s activities.
Power is the stakeholder’s ability to influenceobjectives
Interest is the stakeholder’s willingness
Influence = Power x Interest
Mendelow’s StakeholderPower Mapping
Proximity to organisationInternal such as employees / management
Connected such as shareholders,customers, suppliers (faculty) , lenders,
competitors, trade unions
External such as government, localgovernment, public, pressure groups
Classification of Stakeholders
Narrow and wide stakeholders
Narrow: Most affected by organisation’sstrategy such as shareholders, suppliers
Wide: Less affected by organisation’sstrategy such as government, community
Classification of Stakeholders
The stakeholders in a corporation are the individuals and constituencies that contribute, either voluntarily or involuntarily, to its wealth-creating capacity and activities, and that are therefore its potential beneficiaries and/or risk bearers. – Jams E.Post
The condensed idea: ‘We’re all in this together’
Improving Relationships between stakeholders
Stakeholder Management is key to improving relationships between stakeholders
The Redefining the Corporation project has drawn up seven principles of stakeholder management
Improving Relationships between stakeholders
Principle 1 - Managers should acknowledge and actively monitor the concerns of all legitimate stakeholders, and should take their interests appropriately into account in decision-making and operations
Our Viewpoint: This principle is paramount to the continued existence of the College. We are working towards producing a stakeholder charter to fully achieve this principle.
Seven Principles of Stakeholder Management – Principle 1
Principle 2 - Managers should listen to and openly communicate with stakeholders about their respective concerns and contributions, and about the risks that they assume because of their involvement with the corporation.
Our Viewpoint: This principle requires honesty, integrity and objectivity on the part of the stakeholders when making known their concerns. CCA will operate an open-door policy to enhance communication between the college and its stakeholders.
Seven Principles of Stakeholder Management – Principle 2
Principle 3 - Managers should adopt processes and modes of behaviour that are sensitive to the concerns and capabilities of each stakeholder constituency
Our Viewpoint: This principle requires the management to develop multi-lateral communication systems with stakeholders.
Seven Principles of Stakeholder Management – Principle 3
Principle 4 - Managers should recognise the interdependence of efforts and rewards among stakeholders, and should attempt to achieve a fair distribution of the benefits and burdens of corporate activity among them, taking into account their respective risks and vulnerabilities.
Our Viewpoint: This principle requires all stakeholders to put in efforts that would attract better rewards, due to enhanced performance.
Seven Principles of Stakeholder Management – Principle 4
Principle 5 - Managers should work cooperatively with entities, both public and private, to insure that risks and harms arising from corporate activities are minimised and, where they cannot be avoided, appropriately compensated.
Our Viewpoint: This principle is core to our corporate social responsibility perspective.
Seven Principles of Stakeholder Management – Principle 5
Principle 6 - Managers should avoid altogether activities that might joepardise inalienable human rights (e.g. right to life) or give rise to risks which, if clearly understood, would be patently unacceptable to relevant stakeholders.
Our Viewpoint: This principle is core to our corporate social responsibility perspective.
Seven Principles of Stakeholder Management – Principle 6
Principle 7 - Managers should acknowledge the potential conflicts between (a) their own role as corporate stakeholders, and (b) their legal and moral responsibilities for the interests of stakeholders, and should address these through open communication, appropriate reporting and incentive systems and, where necessary, third party review
Our Viewpoint: This principle is core to our corporate social responsibility perspective.
Seven Principles of Stakeholder Management – Principle 7
Place the four major stakeholders in each of the boxes A to D.◦ ACCA◦ Lecturers ◦ Employees ◦ Students
Feedback
A. Minimal Effort
B. Keep Informed
Level of Interest
Low
High
Pow
er
C. Keep Satisfied
D. Strategy must be acceptable
Low High
I hope that as I have been able to identify the stakeholders of the college and also analyse their influence on the corporate objectives of the college through the assessment of Mendelow Stakeholder Mapping theory, there would be progress in our stakeholder relationship management moving forward.
Conclusion
Questions and Answers