Walter Institute is a research organization with branches in five African countries. The majority shareholder, Mr. Walter though not recognized in the company’s organizational structure, is actively involved in management. He gives directives and instructions to management and employees which are sometimes in direct contravention with the policies of the organization. Customers, employees and management are often affected in various ways by the decisions of Mr. Walter.
Preparations are underway to get the company listed on the Ghana Stock Exchange and a consultant is needed to advise on the improvement of the weak corporate governance status of the company.
Required:
i) Identify FOUR stakeholders of the company and explain the nature of the interests of each in the company. (4 marks)
View Solution
The key stakeholders are customers, employees, directors and management, suppliers, competitors, lenders and financiers, regulators, government and the community.
Interests of stakeholders:
Shareholders – wish to see a good return on their investment and a stable future.
Employees – wish for a steady job and decent pay/conditions
Directors/management – wish to comply with their responsibilities as well as having similar interests to other employees.
Customers – look for appropriate, safe and reasonably priced products plus excellent customer service
Suppliers – are interested in sales volume and price, fair payment terms and long-term relationships.
Competitors – are keen to ensure there is vigorous but fair competition in the market.
Lenders and financiers – are keen for security and to see repayment of their investment in line with the agreed terms.
Regulators – wish to see the company complying with relevant rules and engaging with ideas for further improvement
Government wishes to see a stream of tax income plus a company which is a good corporate citizen.
The community – is interested in the company providing employment and preserving/supporting the environment