Definition of Stakeholder Model



Stakeholder model or stakeholder theory says that the shareholders of a company are not the only stakeholders that are affected by the company’s decisions. Stakeholders involve everything or a group of people that are affected directly or indirectly by the decisions or actions of a company.

 


A company can have stakeholders like management, employees, shareholders, vendors, customers, environment, pressure groups, media, government, and society at large. It is the best management to keep all the stakeholders satisfied rather than focusing on a small group of stakeholders. If a company is involved in the production that emits harmful gases into the air, this will affect the environmental regulatory agencies as it is their job to ensure compliance.


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