Engaging with stakeholders
A Primark case study

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Page 2: What is a stakeholder?

 primark-2All businesses depend on a variety of stakeholders. Some stakeholders are internal to the business, such as a company’s employees. Other stakeholders are external to the business, such as suppliers, customers, trade unions, civil society groups, shareholders and the communities in which the business operates.

Shareholders and stakeholders

It is important to understand the difference between a shareholder and stakeholder. Shareholders are the individuals or organisations that own a company. They own shares in the company. As owners, they will receive a share of the profits. Shareholders are a type of stakeholder because they have an interest in the company. Stakeholders also include all the other groups with an interest in what the company does.

primark-1It can be useful to identify the level of interest, power and influence of different stakeholders. The owners of a company have a high level of power and influence and a direct interest in the profitability of the company.

In contrast, customers have less interest in the company than the shareholders and a lower level of power and influence. However, that does not mean that Primark can afford to ignore its customers. Any business that neglects its customers would soon start to see a decline in sales. Loyal customers are highly valued. Retailers like Primark will seek to understand their customers and meet their needs.

Engaging with stakeholders

Primark uses a variety of methods to engage with its different stakeholder groups. For example, one method that Primark uses to communicate with its customers is through its ethical trading website. To communicate with workers and the communities, in the countries that manufacture the goods, Primark uses initiatives such as the community engagement programme it has in India. Primark understands that different stakeholder groups have different needs and expectations. As such, Primark must use appropriate channels of communication to engage with each stakeholder group.

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Primark uses a variety of methods to engage with its different stakeholder groups. For example, one method that Primark uses to communicate with its customers is through its ethical trading website. To communicate with workers and the communities, in the countries that manufacture the goods, Primark uses initiatives such as the community engagement programme it has in India. Primark understands that different stakeholder groups have different needs and expectations. As such, Primark must use appropriate channels of communication to engage with each stakeholder group.

Primark | Engaging with stakeholders
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