Business Ethics: Stakeholders & Corporate Governance PDF

# Business Ethics: Stakeholders & Corporate Governance ## Stakeholders - **Concept:** A stakeholder is any individual or group that can affect or is affected by the actions, decisions, policies, practices, or goals of an organization. - **Types of Stakeholders:** - **Stockholder or Shareholde...

# Business Ethics: Stakeholders & Corporate Governance ## Stakeholders - **Concept:** A stakeholder is any individual or group that can affect or is affected by the actions, decisions, policies, practices, or goals of an organization. - **Types of Stakeholders:** - **Stockholder or Shareholder:** An investor or owner of a business. ## Who are Business' Stakeholders? ### According to Ghillyer (2018) - Stockholders or shareholders - Employees - Customers - Suppliers/vendor partners - Retailers/wholesalers - Federal government - Creditors - Community ### According to Carroll & Buchholtz (2018) #### 1. Primary Stakeholders - Shareholders and investors - Employees and managers - Customers - Local communities - Suppliers and other business partners #### 2. Secondary Stakeholders - Government and regulators - Civic institutions - Social pressure/activist groups - Media and academic commentators - Trade bodies - Competitors ## Stakeholders' Interests in the Organization - **Stockholders or Shareholders:** - Growth in the value of company stock. - On-time dividend payment. - **Employees:** - Stable employment at a fair rate of pay. - A safe and comfortable working environment. - **Customers:** - Fair exchange for a product or service of acceptable value and quality. - Safe and reliable products. - **Suppliers/Vendor Partners:** - Prompt payment for delivered goods. - Regular orders within acceptable profit margin. - **Retailers/Wholesalers:** - Accurate deliveries of quality products on time and at a reasonable cost. - Safe and reliable products. - **Federal Government:** - Tax revenue. - Operation in compliance with all relevant legislation. - **Creditors:** - Principal and interest payments. - Repayment of debt according to the agreed schedule. - **Community:** - Employment of local residents. - Economic growth. - Protection of the local environment. ## Stakeholders' Impact From Unethical Behavior - **Stockholders of Shareholders:** - False and misleading financial information. - Loss of stock value. - Cancellation of dividends. - **Employees:** - Loss of employment. - Insufficient funds for severance packages or pension obligations. - **Customers:** - Poor service quality. - **Suppliers/Vendor Partners:** - Delayed payment for delivered goods and services. - Unpaid invoices during bankruptcy. - **Federal Government:** - Loss of tax revenue. - Non-compliance with legislation. - **Creditors:** - Loss of principal and interest payments. - Failure to repay debt. - **Community:** - Unemployment of local residents. - Economic decline.