Explain the implications for the business and stakeholders of a business operating ethically. (P2)
All businesses have a number of stakeholders each with individual interests in what the business does, the owners (In co-ops case, the members) will want good financial gains from their investments. Businesses such as co-op should be managed with the interests of all stakeholders in mind.
Stakeholder is anyone with an interest in a business. Stakeholder can be individuals, groups or even organisations that are affected by the activity of the business, they include:
• Owners who are interested in how much profit the business makes • Managers who are concerned about their salary
• Workers who want their wages to be increased and keep their jobs • Customers who want the business to produce goods of real quality • Suppliers who want the business to continue to buy the products they sell. • The community which has a stake in the business as employers of local people
The cooperative have to balance the aims and objectives of a number of stakeholders. This is actually a very difficult task because the interests of stakeholder groups will conflict with one another.
There are two types of stakeholders,
• Internal stakeholders: Groups within a business – eg owners and workers
The best thing about the cooperative group is the fact that they are not owned by shareholders and are actually owned by their members. The co-op is the only major supermarket in the company that are owned by their members therefore any implications will affect them first. Co-op is already quite an ethical company but there is always room for improvement. For example one ethical thing that they could improve on is the prices of their products and their eco-friendliness. The smaller co-op stores are normally near residential areas therefore people might walk their because it is in walking distance therefore they are not polluting the environment...
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