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Any individual or group
Who can affect or is affected
By the actions, decisions,policies and practices or goals ofan organisation.
Two Types
Primary Secondary
Owners Media
Customers Consumers
Employees Courts and Govts.
Suppliers Competitors
Public and Society
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Government Employees
Business
Community
Consumers
Owners
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Businesses in their fiduciary relationship tostakeholders: Act in the best interests of the stakeholders Respect and fulfill the stakeholders rights
Relationship with external groups aiming atreaching win-win collaborative outcomes
Win-Win: making moral decisions that benefit thecommon good of all constituents in the givenconstraints
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Map SH relationships
Map SH coalition
Assess the nature of each SH interest
Assess the nature of each SH power
Construct a matrix of SH moralresponsibilities
Develop strategies and tactics
Monitor shifting coalitions
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Map SH relationships Current SH
Potential SH
How does each SH affect us? How do we affect each SH?
For each division and business, who are the SH?
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Map SH coalition Are formed around the stakes they have in
common
Competitors Interest Groups
Anticipate and design strategic responsestoward these groups
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Assess the nature of each SH interest Supportive
Non-supportive
Mixed blessing Marginal
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Stakeholder Type 4Mixed Blessing
Stakeholder Type 3Non supportive
Stakeholder Type 1Supportive
Stakeholder Type 2Marginal
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Assess the nature of each SH power Voting Power (exert control through number)
Political power(influence decision making)
Economic power(influence by control over resources)
Technological power (ability to influence innovations thrutechnology)
Legal power(influence laws and procedures)
Environmental power
Cultural power (influence values and norms)
Power over individuals and group)
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Identify SH Ethics and MoralResponsibilities To determine resp. and moral obligations the
company has towards each SH To develop strategies towards each shareholder
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Stakeholders Economic Legal Ethical Philanthropic
Owners
Customers
Employees
Community
Public at large
Social Activists
Other
SH RESPONSIBILITY MATRIX
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Develop specific strategies and tactics To approach each stakeholder directly or indirectly
To decide whether to do nothing, monitor, or take anoffensive or defensive position
To determine whether to accommodate, negotiate,manipulate, resist, avoid or wait and see
Finally, to decide what combination of strategies toemploy to achieve goal
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Stakeholder Type 4Mixed Blessing
Strategy:Collaborate
Stakeholder Type 3
NonsupportiveStrategy:Defend
Stakeholder Type 1Supportive
Strategy:Involve
Stakeholder Type 2
MarginalStrategy:Monitor
High
Low
StakeholdersPotential forCooperationWith
Organization
High Low
Stakeholders Potential for Threat to
Organization
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Goal is to create win - win set of outcomes
Keep mission and responsibility in mind beforeproceeding
Consider probable consequences of actions
Specific strategies can be articulated and assigned tocorporate staff for review and implementation
Remember.SR IS THE KEY VARIABLE
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Monitor shifting coalitions
Change in stakes and SH because of timeand events
Tracking external trends and events
A dynamic process that occurs over time
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Mixed Blessing-Chinese manufacturers
Non supportive-Victims who lost jobs
-Customers negatively affected bytoys
-Some competitors
-Employees negatively affected
Supportive-Mattels CEO and top level
team
-Many employees
-Many shareholders
Marginal-Some shareholders
-Some customers
-Some suppliers
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WHAT ETHICAL PRINCIPLE, CEO shouldfollow?
Utilitarian Approach?
Weigh cost and benefits of all strategies
and actions towards SH keepingcompanys interest in mind
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OR
Universalistic Approach Attempt to provide care to child harmed
Take immediate action to recall toysmanufactured in China
Have planned meetings with those in charge of
sub contractors Meet the victim families, media and powerful
govt. representatives to show concern
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A rational, systematic basis for understanding issuesand the ethics in action involved in complexrelationships between an organisation, its leaders andconstituents
Extent to which the resultant strategies and outcomesare moral and effective for a firm and its SH depends onfactors like:
Including the values offirms leaders SHs power
Legitimacy of actions
Use of available resources
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