Who's Got Skin in the Game? The Ultimate Guide to Business Stakeholders

Who's Got Skin in the Game? Business Stakeholders Explained

Stakeholders are like when you're watching the latest season of The Traitors, and everyone's got their own agenda, alliances are shifting left and right, and nobody quite knows who to trust. Welcome to the world of business stakeholders - where instead of trying to win £120,000, everyone's fighting for their slice of the corporate pie.

Do you mean a Stakeholder or a Shareholder?

Right, let's get this straight from the off - stakeholders are basically anyone who cares about what your business does. And I mean really cares, because what you do affects them directly. Think of it like this: if your business was a massive group chat, stakeholders would be everyone who actually reads the messages instead of just muting the notifications.

Now, here's where loads of people get their knickers in a twist – stakeholders aren't the same as shareholders. I know, I know, they sound practically identical, like Ant and Dec or fish and chips. But here's remember this: all shareholders are stakeholders, but not all stakeholders are shareholders.

Shareholders are the ones who've actually bought shares in your company - they own a bit of it. Stakeholders? That's everyone who's affected by your business, whether they own shares or not. It's like the difference between people who live and share a house with you (shareholders) and everyone who lives on your street (stakeholders) - your noisy 2 a.m house parties affect them all, but only some of them get a say in turning down the music.

IB Business Management: Internal Stakeholders (The Ones Living in Your House)

Employees: The Real MVPs

Let's start with employees - the absolute legends who actually make your business tick. These are your shop floor workers, your office warriors, your baristas who somehow remember that complicated oat milk order every morning.

IB Business Management Real-life Example: Take Tesla, for example. Back in April 2024, Elon Musk made the rather brutal decision to lay off 10% of Tesla's workforce - that's roughly 14,000 people suddenly updating their CVs and sending them somewhere else. These employees weren't just numbers; they were stakeholders whose livelihoods depended on Tesla's decisions. They wanted job security, decent wages, good working conditions, and maybe the occasional free Tesla Model 3.

Employees influence businesses 150%. When they're motivated and happy, productivity soars. When they're narked off about poor working conditions or rubbish pay? Well, let's just say your business performance might crash harder than a contestant in Bachelor in Paradise who's just been dumped.

Managers and Directors: The Puppet Masters

Then you've got your managers and directors - the ones calling the shots and probably drinking way too much coffee while doing it. These are the people making strategic decisions, often whilst juggling the competing demands of everyone else.

They're after improved productivity, operational efficiency, better customer relations, and naturally, better compensation packages.

IB Business Management Real-life Example: Speaking of which, Apple's CEO Tim Cook pocketed a tidy £59 million ($74.61 million) in 2024 - not exactly pocket money, is it?

But managers and directors are stakeholders too, and they often have to balance their own interests with everyone else's.

Shareholders: The Money People

Shareholders are the ones who've put their money where their mouth is. They own actual shares in the company, which means they get dividends when things go well and voting rights at AGMs (imagine being able to vote people off Love Island - that's essentially what shareholders do with board members).

IB Business Management Real-life Example: Just ask Warren Buffett about Apple - his company Berkshire Hathaway owns £58 billion worth of Apple shares, though they did flog off 25% of their stake in 2024.

Shareholders want returns on their investment, growing share prices, and basically, they want the company to print money faster than the Bank of England during a crisis.

The Outside Brigade: External Stakeholders (Your Street Neighbours)

Customers: The Kings and Queens

Without customers, your business is basically like a TikTok account with zero views - technically it exists, but nobody cares. McDonald's serves 69 million customers daily worldwide. That's more people than the population of the UK! These customers want value for money, quality products, and maybe the occasional working ice cream machine (seriously, Mickey D's -Mc Donald's-, sort those machines out).

IB Business Management Real-life Example: Apple's got 1.8 billion active devices globally. Their customers are so loyal, they'll queue for hours for the latest iPhone, even though it looks suspiciously similar to last year's model.

Customer satisfaction directly impacts revenue, and unhappy customers spread bad news faster than gossip on teachers at a Year 13 common room.

Suppliers: The Unsung Heroes

Suppliers are like that mate who always has what you need - they provide the raw materials, components, and services that keep businesses running.

IB Business Management Real-life Example: McDonald's works with suppliers like Lopez Foods and Kenny Longaker to ensure their chips are consistently addictive and their burgers don't taste like cardboard.

Tesla imports their battery technology from Japan and brake discs from Europe.

These suppliers want regular orders, prompt payment, and reasonable prices. Mess about with your suppliers, and you might find yourself without the essential bits to actually run your business - not ideal, really.

Competitors: The Rival Schools

Competitors are obviously interested in what you're up to, but they want you to play fair. It's like academic rivalry between schools - healthy competition is good, but nobody wants someone cheating their way to the top. They set their own strategies based on what everyone else is doing, creating this massive strategic chess game where everyone's trying to outsmart each other.

Local Community: Your Actual Neighbours

The local community wants businesses to be good neighbours - creating jobs, not trashing the environment, and maybe sponsoring the local football team.

IB Business Management Real-life Example: McDonald's does this through Ronald McDonald House Charities, supporting families when their children are poorly.

It's proper community spirit, and it helps build a positive local reputation.

Pressure Groups: The Activists

Pressure groups are like that passionate friend or nagging neighbour who won't shut up about recycling - they push businesses to do the right thing. Environmental groups absolutely love Tesla because they're helping save the planet, one electric car at a time. But they're also keeping a close eye on other companies to ensure they're not destroying the environment for profit.

Financiers: The Bank Managers

Financiers - banks, lenders, creditors, financial institutions - these are the people who lend businesses money and want it back (with interest, obviously). They're constantly checking if businesses can actually repay their debts, using financial analysis that's more complex than your timetable the first two days of term.

Government: The Rule Makers

Finally, government - the ultimate authority figures who set the rules and collect taxes. They want businesses operating legally and contributing to society.

IB Business Management Real-life Example: In 2024, 25 California counties sued Tesla for illegally disposing of hazardous waste - Tesla ended up paying £1.2 million and had to retrain their staff.

Governments can make or break businesses with regulations, taxes, and policies.

Why It Matters (And How It will help you in Your IB Business Management Exams)

Understanding stakeholders isn't just academic waffle - it's essential for business success. Companies that ignore their stakeholders often find themselves in proper hot water. Remember, different stakeholders have different priorities, and businesses constantly juggle these competing demands.

When answering IB Business Management exam questions, always consider which stakeholders are affected by business decisions. Are employees being made redundant? How do customers feel about price increases? What about environmental impact? Examiners love students who can identify stakeholder impacts and explain how businesses might manage these relationships.

The key takeaway? Business isn't just about making money - it's about managing relationships with everyone who has skin in the game. Get this right, and you're laughing. Get it wrong, and you might find yourself in more trouble than someone who gets in the way of Tony Soprano.

Stay well,