Definition of Primary Stakeholders

by Tyler Lacoma; Updated September 26, 2017
Stakeholders have significant investments in resources or businesses.

The term primary stakeholder is used in a sociological and financial sense. The term is synonymous with key stakeholder and often with the simple term "stakeholder". What type of primary stakeholder is being referenced depends largely on context. Businesses look at primary stakeholders as those with an investment in a particular business matter. Sociologists see primary stakeholders in a wider view relating to the management of natural resources important to the economy.

Definition

A primary stakeholder is a person or group of people directly impacted by a certain matter. They have invested in a project or economy, with their time, money, attention, ocation or their allegiance. Because of this investment, they are affected by the object of their investment. If the object becomes more successful, so do they. If it fails or decreases in value, the primary stakeholders share the same fate.

Resources

In the view of sociologists, primary stakeholders are those who depend directly on a resource. For instance, fisherman are primary stakeholders when it comes to the nearby ocean because their livelihood depends on the fish. If something happens to the fish, their livelihood will be compromised. Likewise, the merchants who sell the fish and the people who transport the fish are also primary stakeholders who depend directly on the resource.

Finances

In the financial world, the primary stakeholders are those who have money directly invested in a business. These people are not always those who benefit from the business practices themselves, but those who own a part of the business and are impacted depending on its success or failure. They are interested in the company's overall strategies and success, because they stand to gain or lose by its actions.

Financial Stakeholder Groups

Financial primary stakeholders are often divided into several groups. Capital market stakeholders are shareholders and lenders who have directly invested money in the company and want to preserve and increase their wealth. Product market stakeholders are people who benefit directly from the business without necessarily investing money, such as suppliers and some customers. Organizational stakeholders are employees who work for the company and depend on survival for income.

Secondary Stakeholders

Secondary stakeholders are those not directly impacted by investment, but who experience some sort of change regardless. The entire public of a nation is a secondary stakeholder to most businesses, because these businesses pay taxes which are then used by the government to create benefits for the citizens.

About the Author

Tyler Lacoma has worked as a writer and editor for several years after graduating from George Fox University with a degree in business management and writing/literature. He works on business and technology topics for clients such as Obsessable, EBSCO, Drop.io, The TAC Group, Anaxos, Dynamic Page Solutions and others, specializing in ecology, marketing and modern trends.

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