Role of Stakeholders in Business
A stakeholder in a business setting is responsible for the outcomes (positive or negative) of the business. A stakeholder may also have made an investment in the business, which also causes her to have an interest in the business's success or failure. Stakeholders have different roles within a business, and it depends on the rules, titles and responsibilities laid out either when the business was initially established or as the business grows and changes.
Stakeholders may be responsible for voting on significant changes in the business. Voting can take place annually based on the corporate structure of the business or during any meeting. Stakeholders such as board of directors may vote to elect management that will be entrusted to make all the major decisions on his own. Stakeholders may intervene if the business is performing unsatisfactory.
Stakeholders can hold significant management positions where they may report directly to the president, CEO or chief financial officer. Within certain departments, the manager may be a stakeholder because his decisions may cause the success or failure of that department's performance, Management may be responsible for hiring personnel within that department, providing training and informing the department of any updates or changes in the business's policies and procedures.
Stakeholders are commonly responsible for maintaining or achieving a return on investment. Sometimes, the investment can be made on a consistent basis over time. For example, consistently investing in stocks through one company is an example of a stakeholder that is continuously increasing her stake in the company. Stakeholders are responsible for reviewing the financial data of the company to ensure that the business is performing well and that they are not losing their investment. They may also be responsible for voting on allocation of certain funds.
Stakeholders must continuously ensure that decisions they are making for the business are doing little to harm society and the environment. They may choose to use an alternate resource if they realize that current resources are becoming scarce. Stakeholders can donate money to a country that is in need or they may choose to limit their depletion of resources or exploitation of the workers in a certain location (such as a third-world country). They continuously monitor the decisions the company is making to ensure that the public interest is always first and foremost before profit.