Who are a business's stakeholders, what does each want, and how can their interests conflict?
Stakeholders: the internal and external groups with an interest in a business (owners, employees, customers, suppliers, the local community and the government), what each wants, and how their interests can conflict.
A CCEA GCSE Business and Communication Systems answer on stakeholders. Covers internal and external stakeholders, owners, employees, customers, suppliers, the local community and the government, what each wants from a business, and how stakeholder interests can conflict, with worked exam technique.
Reviewed by: AI editorial process; not yet individually human-reviewed
Have a quick question? Jump to the Q&A page
Jump to a section
What this dot point is asking
You need to identify the stakeholders of a business, the groups with an interest in it, explain what each wants, and explain how their interests can conflict. Unit 2 places businesses in their environment, and stakeholders are how a business connects to the world around it: owners, the people who work for it, the people who buy from it, those who supply it, the community around it and the government. The exam rewards precise interests applied to a real business, and, for higher marks, clear explanation of conflict rather than a list.
Who the stakeholders are
A stakeholder is any group or individual with an interest in a business.
What each stakeholder wants
Each group judges the business by whether its own interest is met, so questions often ask you to match the group to its interest.
- Owners or shareholders want profit, a return on their investment, and the business to grow and survive.
- Employees want fair pay, job security, good working conditions and the chance to develop.
- Customers want good quality, low prices, choice and reliable service.
- Suppliers want to be paid on time, to receive regular orders, and for the business to keep trading well.
- The local community wants jobs, local spending, and little disruption such as noise, traffic or pollution.
- The government wants the business to pay its taxes, obey the law, and create jobs that reduce unemployment.
How stakeholder interests conflict
Because stakeholders want different things, their interests often clash, and a business cannot satisfy everyone at once.
For example, a business that cuts costs by lowering wages pleases its owners (more profit) but upsets its employees (less pay) and possibly its customers if service then suffers. Recognising that a decision has winners and losers among the stakeholders is exactly the analysis CCEA rewards.
Worked example: analysing a decision's effect on stakeholders
A common task is to take a business decision and explain how it affects different stakeholders.
Why this matters
Stakeholders connect a business to the wider environment and explain why running one is about more than profit. Every decision, on prices, wages, location or new technology, affects several groups, and ignoring a powerful stakeholder can backfire: unhappy employees may leave, angry customers may switch, and a hostile community can block expansion. In the exam, the most valuable skill is to analyse how a specific decision affects named stakeholders and to explain the conflict between them, rather than listing groups.
Try this
Q1. Define the term stakeholder. [2 marks]
- Cue. Any person or group that has an interest in a business or is affected by its activities.
Q2. State what suppliers want from a business. [2 marks]
- Cue. To be paid on time and to receive regular orders, and for the business to keep trading well.
Q3. Give one example of a conflict between two stakeholder groups. [2 marks]
- Cue. Owners want higher profit and so low wages, while employees want higher pay; or customers want low prices while owners want higher prices.
Exam-style practice questions
Practice questions written in the style of CCEA exam questions on this dot point, with worked answer explainers. The year tag is the paper they imitate, not the source.
CCEA Unit 2 (style)4 marksIdentify two stakeholders of a supermarket and state what each wants from the business.Show worked answer →
A 4-mark application question testing AO1 and AO2: name a stakeholder and state its interest, for two marks each.
Customers want low prices, good quality and a wide choice of products (2 marks).
Employees want fair pay, job security and good working conditions (2 marks).
Other valid answers: owners or shareholders want profit; suppliers want to be paid on time and to get regular orders; the local community wants jobs and little disruption; the government wants taxes paid and laws obeyed. The mark is for the stakeholder plus its specific interest, not just the name.
CCEA Unit 2 (style)6 marksExplain how the interests of different stakeholders in a business can conflict.Show worked answer →
A 6-mark explain question testing AO2 and AO3: show conflict between named groups, not just a list.
Owners want higher profit, which can lead them to keep wages low, while employees want higher pay, so the two interests conflict (2 marks).
Customers want low prices, but suppliers want a good price for their goods, so the business cannot fully satisfy both at once (2 marks).
The local community may oppose a new factory because of noise and traffic, while owners want it for profit and employees want it for jobs (2 marks). A developed answer explains at least two conflicts clearly, showing why both sides cannot be fully satisfied, to reach the higher marks.
Related dot points
- Types of business ownership: sole trader, partnership, private limited company (Ltd) and the public sector, including limited and unlimited liability and the advantages and disadvantages of each.
A CCEA GCSE Business and Communication Systems answer on types of business ownership. Covers the sole trader, partnership and private limited company, the meaning of limited and unlimited liability, the public sector, and the advantages and disadvantages of each form of ownership.
- Recruitment and selection: internal and external recruitment, the recruitment documents (job description, person specification, advertisement, application form and CV), and the selection methods used to choose the best candidate.
A CCEA GCSE Business and Communication Systems answer on recruitment and selection. Covers internal and external recruitment, the recruitment documents, job description, person specification, advertisement, application form and CV, and the selection methods (shortlisting, interviews, tests and references) used to choose the best candidate.
- Business communication: internal and external communication, written, verbal and electronic methods and business documents, choosing a suitable method, the features of effective communication and barriers to it.
A CCEA GCSE Business and Communication Systems answer on business communication. Covers internal and external communication, written, verbal and electronic methods and documents, how to choose a suitable method, the features of effective communication and the barriers that cause it to break down.
- Implications of digital technology for business and customers: effects on ways of working and jobs, data security threats and protection, and the legislation businesses must follow when handling data and trading online.
A CCEA GCSE Business and Communication Systems answer on the implications of digital technology for business and customers. Covers effects on ways of working and jobs, data security threats and protection methods, and the legislation, such as data protection, that businesses must follow when handling personal data and trading online.
- The marketing mix: the four Ps (product, price, place and promotion), the pricing and promotion methods within them, and how the four Ps must work together and suit the target market.
A CCEA GCSE Business and Communication Systems answer on the marketing mix. Covers the four Ps, product, price, place and promotion, the pricing methods (cost-plus, competitive, penetration and skimming) and promotion methods, and how the four Ps must work together and suit the target market.