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Corporate social responsibility and corporate governance

Stakeholder theory

3.1 Stakeholders

Freeman defines stakeholders as 'any person or group that can affect
or be affected by the policies or activities of an organisation'.

3.2 Stakeholder claims

These are the demands that the stakeholder makes of an organisation.
They essentially ‘want something’ from an organisation.

 Direct stakeholder claims are usually unambiguous, and are often
made directly between the stakeholders and the organisation e.g.
trade unions

 Indirect claims are made by those stakeholders unable to express
their claim directly to the organisation. They have no ‘voice’ e.g.an
individual customer of a large organisation

NB The claim of an indirect stakeholder will need to be interpreted by someone else
in order to be expressed

3.3 Stakeholder classifications and relations

Internal and external stakeholders

 This is the distinction between stakeholders inside the organisation and those
outside.

 internal: e.g. employees and management

 external: e.g. customers.

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