UK Accounting Glossary
A general term devised to indicate all those who might have a legitimate interest in receiving financial information about a business because they have a ‘stake’ in it.
A stakeholder is a party that has an interest in a company and can either affect or be affected by the business.
A person, group or organisation that has interest or concern in an organisation.
Any individual, group or business with a vested interest (a stake) in the success of an organization is considered to be a stakeholder. A stakeholder is typically concerned with an organization delivering intended results and meeting its financial objectives. In general, a stakeholder can be one of two types: internal (from within an organization) or external (outside of an organization). Examples of a stakeholder are an owner, manager, shareholder, investor, employee, customer, partner and/or supplier, among others. A stakeholder may contribute directly or indirectly to an organization’s business activities. Other than a traditional business, a stakeholder may also be concerned with the outcome of a specific project, effort or activity, such as a community development project or the delivery of local health services. A stakeholder usually stands to gain or lose depending on the decisions taken or policies implemented.
Stakeholders can affect or be affected by the organisation’s actions, objectives and policies.
Some examples of key stakeholders are creditors, directors, employees, government (and its agencies), owners (shareholders), suppliers, unions, and the community from which the business draws its resources.
If you feel that a company is going to perform really well in future, you may want to consider becoming a stakeholder in the organisation.
Opening up the stock options to the employees made them stakeholders in the business, and they became more focused on the company’s long-term success.
As a stakeholder in several large telecommunications corporations, he receives quarterly updates their forecasts and budget projections.
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This glossary post was last updated: 23rd December 2018.