Complete the fill-in-the-blank questions below to test your knowledge of the material in chapter 4 of the textbook.
1
The term 'stakeholder' can encompass a wide range of interests. It is really any individual or group on which the activities of the have an impact.
There is increasing recognition that a company cannot operate in isolation but that it should consider the impact of its operations on the wider stakeholder groups and not just on shareholders.
Page reference: 49
2
The have an interest in the company as it provides their livelihood in the present day and they will also usually be in receipt of a pension from the company at some point in the future.
In this sense employees are stakeholders both in terms of the fact that they are currently employed in the company but also as they contribute to a pension scheme, then they have an interest in that aspect as well. In addition employees are often also consumers (customers) of the company's end product depending on what that is.
Page reference: 51
3
The board of directors should consider its relations with stakeholders but is to shareholders.
This sentiment indicates that whilst the board should be aware of the interests of the various stakeholder groups, it is the shareholders who provide the risk capital for the business and it is they to whom the board is held accountable.
Page reference: 58
4
The Royal Society of Arts (RSA) is a multidisciplinary independent body which has commissioned reports including ' Company'.
The 'Tomorrow's Company' report advocated an inclusive approach for business in its relationship with various stakeholder groups. The work of 'Tomorrow's Company' has had a lasting impact and is carried on today via a not-for-profit research and agenda setting organisation.
Page reference: 54
5
Stakeholder groups include groups who seek to ensure that companies operate to appropriate national and international standards such as the CERES Principles.
Increasingly environmental issues are viewed as part of the mainstream rather than being at the periphery as a 'wish list'.
Page reference: 52/53
