The world ''stakeholder'' was first used in an internal memorandum at the Stanford Research Institute in 1963. It refers to "those groups without whose support the organizations would cease to exist". There are two types of stakeholders, primary and secondary. The first type are those that engage in economic transactions with the business - stockholders, customers, suppliers, creditors and employees. The second type are those who do not engaged in direct economic exchange with the business but are affected by or can affect its actions the general public, communities, activist groups, business support groups and the media.
Stakeholders are the individuals and groups of people who have an interest in how the business is run. They are said to have a stake in the business. An example of this is the stakeholders for a school. These would be the Head teacher, assistant head teacher, deputy head, head of year, assistant head of year, subject teachers, senior teachers, cleaners, canteen teachers, cooks, mentors, heads of department, caretakers and nurses.
Each stakeholder is interested in the business for a different reason. For example one stakeholder would be the customers. This example of stakeholder would have an interest in the business because they would want to buy the products the business is selling. They also would want more value for their money and the goods the business is selling should be meeting their expectations.
Another stakeholder would be the employee. The employee would be interested in the business because they would want the business to succeed and make more money than other businesses around the community. This is because if the business does badly and ends up closing down many employees would be out of a job leaving them unemployed and they wouldn’t be making money. An employee would want the business to succeed and be successful because they would want to earn good wages.
Another type of stakeholder...