External stakeholders are a little harder to identify, seeing as they do not have a direct relationship with the company.
A stakeholder is a party that has an interest in a company and can either affect or be affected by the business. The primary stakeholders in a typical corporation are its investors, employees, customers and suppliers.
However, the modern theory of the idea goes beyond this original notion to include additional stakeholders such as a community, government or trade association. Stakeholders are those groups who have a stake in or claim on the form.
Stakeholders can be internal or external. Internal stakeholders are people whose interest in a company comes through a direct relationship, such as employment, ownership or investment.
External stakeholders are those people who do not directly work with a company but are affected in some way by the actions and outcomes of said business.
External stakeholders are a little harder to identify, seeing as they do not have a direct relationship with the company. Instead, an external stakeholder is normally a person or organisation affected by the operations of the business.
When a company goes over the allowable limit of carbon emissions, for example, the town in which the company is located is considered an external stakeholder because it is affected by the increased pollution. The government, for example, is an external stakeholder.
From the Book – ‘ Know Everything about Corporate Social Responsibility ‘
Available on Amazon.in
Also Read:
- What is Crony Capitalism?
- What Is Capitalism?
- What is Socialism?
- What is Free Enterprise?
- What is Third World?
- What is the Fourth World?
- What is Sustainable Economic Growth?
- What is Inclusive Growth?
- What is Industrialisation?
- What are the Effects of Industrial Revolution in India?
- What is Industry?
- What is Business?
- What is a Business Organisation?
- What is Corporate?
- What is a Startup?
(India CSR)
