Business – 1.5 Stakeholders – Business stakeholders | e-Consult
1.5 Stakeholders – Business stakeholders (1 questions)
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Effective stakeholder management ensures that the interests of those who can influence or are affected by the business are considered, leading to sustainable performance.
Potential consequences of poor management include:
- Reduced employee morale and productivity: Ignoring internal stakeholders such as staff can cause disengagement, higher turnover and lower output.
- Loss of customers and market share: If external stakeholders like customers feel their needs are unmet, they may switch to competitors.
- Legal and reputational damage: Failure to address external stakeholders such as regulators or the community can result in fines, lawsuits, and negative publicity.
By engaging both groups, a company can build trust, improve decision‑making, and create a competitive advantage.