Stakeholders in Commercial Organisations Notes for ICSE Class 10 Commercial Studies Chapter 1

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Last Updated on August 12, 2024 by sanjjeett

Hello students, we are providing notes for ICSE class 10 commercial studies. The resources for ICSE Commercial Studies are very less. So, to help icse board students we have created chapterwise notes for class 10 commercial studies. In this article, you will find notes for ICSE Class 10 Commercial Studies Chapter 1 Stakeholders in Commercial Organisations. It is a part of Notes for ICSE Class 10 Commercial Studies series.

Chapter	Stakeholders in Commercial Organisations
Type of Material	Notes
Board	ICSE
Class	10
Subject	Commercial Studies
Unit	Unit 1 Stakeholders in Commercial Organisations
Useful for	Class 10 Studying Students
Notes provided	Yes
Important Link	ICSE Class 10 Commercial Studies Chapterwise Notes

Notes on Stakeholders in Commercial Organisations

Stakeholders

Stakeholders are individuals, groups, or entities that have an interest or stake in a particular project, organization, or system. They can significantly impact or be impacted by the outcomes and activities related to that entity. Stakeholders can include customers, employees, investors, government agencies, suppliers, and communities.

For example, in a company launching a new product, stakeholders would include not only the customers buying the product but also employees involved in its production, investors seeking returns, regulatory authorities overseeing compliance, and even the local community affected by the company’s operations. Recognizing and managing the interests of these stakeholders is crucial for the success and sustainability of the project or organization.

Types of stakeholders

Stakeholders can be categorized into two main types: internal stakeholders and external stakeholders.

1. Internal Stakeholders:

• Employees: Individuals working within the organization, from frontline staff to executives, are considered internal stakeholders. They are directly involved in the day-to-day operations and success of the company.
• Management and Board: Executives, managers, and board members hold significant influence over the organization’s direction and decision-making processes. They are crucial internal stakeholders.
• Shareholders: Individuals or entities that own shares in the company are internal stakeholders. Their interests lie in the financial performance and growth of the organization.
• Internal Teams: Different departments and teams within the company, such as marketing, finance, and production, are internal stakeholders with specific roles in contributing to organizational goals.

2. External Stakeholders:

• Customers: External stakeholders who purchase or use the products or services offered by the organization. Customer satisfaction is vital for the company’s success.
• Suppliers: Entities providing goods or services to the organization are external stakeholders. The relationship with suppliers can impact the quality and efficiency of the company’s offerings.
• Investors: Individuals or institutions investing capital in the organization but not directly involved in its day-to-day operations are external stakeholders. They seek a return on their investment.
• Government and Regulatory Bodies: External entities that set and enforce regulations affecting the industry or specific business operations. Compliance is essential to meet legal requirements.
• Communities: Local communities where the organization operates are external stakeholders. Their interests include environmental impact, job creation, and the overall effect on the community.

Also read: ICSE Class 10 Commercial Studies Notes

Expectations of employers from a commercial organization

1. Strategic Leadership: Employers are expected to provide clear direction and strategic vision for the organization, guiding it towards its goals and ensuring long-term sustainability and growth.
2. Effective Management: Employers should implement efficient management practices to optimize resources, streamline operations, and foster a productive work environment.
3. Financial Stewardship: Employers are responsible for managing the organization’s finances prudently, making sound investment decisions, and ensuring fiscal accountability to stakeholders.
4. Market Responsiveness: Employers should monitor market trends, anticipate changes, and adapt the organization’s strategies and offerings to remain competitive and meet customer needs.
5. Compliance and Governance: Employers must uphold legal and regulatory requirements, adhere to ethical standards, and maintain transparency in their business practices to build trust and credibility with stakeholders.
6. Talent Management: Employers should attract, retain, and develop top talent by offering competitive compensation, providing opportunities for growth and advancement, and fostering a supportive and inclusive workplace culture.
7. Innovation and Adaptability: Employers need to foster a culture of innovation, encouraging experimentation, embracing new technologies, and adapting quickly to changing market dynamics to stay ahead of the curve.
8. Stakeholder Engagement: Employers should actively engage with various stakeholders, including employees, customers, investors, and communities, to build strong relationships, address concerns, and create shared value for all parties involved.

Expectations of creditors from a commercial organization

1. Timely Repayment: Creditors expect the commercial organization to make timely repayments of any debts or obligations according to the agreed-upon terms and conditions.
2. Transparency and Communication: Creditors expect open and transparent communication from the organization regarding its financial status, including providing regular updates on cash flow, financial performance, and any potential challenges that may affect repayment.
3. Financial Stability: Creditors expect the organization to maintain financial stability and liquidity to ensure its ability to meet its debt obligations, avoid default, and preserve the creditor’s interests.
4. Compliance with Agreements: Creditors expect the organization to comply with all agreements and contracts related to the debt, including adhering to repayment schedules, interest rates, and any other terms specified in the borrowing agreement.
5. Risk Management: Creditors expect the organization to effectively manage financial risks, such as market fluctuations, operational challenges, or regulatory changes, to minimize the likelihood of default and protect the creditor’s investment.
6. Asset Protection: Creditors expect the organization to protect its assets and maintain adequate collateral or security to secure the debt, providing assurance to the creditor in case of default.
7. Continuous Performance Improvement: Creditors may expect the organization to demonstrate a commitment to continuous performance improvement, such as implementing cost- saving measures, increasing efficiency, or expanding revenue streams, to ensure its long-term financial health and ability to repay debts.
8. Honesty and Integrity: Creditors expect the organization to operate with honesty, integrity, and good faith in all financial dealings, avoiding fraudulent or deceptive practices that could jeopardize the creditor’s trust and confidence in the organization.

Expectations of suppliers from a commercial organization

1. Timely Payment: Suppliers expect the commercial organization to make timely payments for goods or services rendered according to the agreed-upon terms and conditions.
2. Consistent Demand: Suppliers expect a consistent and reliable demand for their products or services from the commercial organization, which enables them to plan production schedules, manage inventory levels, and allocate resources efficiently.
3. Clear Communication: Suppliers expect clear and open communication from the commercial organization regarding order specifications, delivery schedules, and any changes or issues that may arise during the procurement process.
4. Fair Treatment: Suppliers expect fair and equitable treatment from the commercial organization in terms of pricing, contract terms, and negotiation practices, ensuring a mutually beneficial partnership.
5. Quality Standards: Suppliers expect the commercial organization to uphold high-quality standards for the products or services they procure, including adherence to specifications, regulatory requirements, and industry best practices.
6. Long-Term Partnerships: Suppliers may seek to establish long-term partnerships with the commercial organization based on trust, reliability, and mutual respect, fostering collaboration and shared success over time.
7. Payment Flexibility: Suppliers appreciate flexibility in payment terms, such as partial payments, installment plans, or early payment incentives, which can help improve cash flow and mitigate financial strain.
8. Ethical Business Practices: Suppliers expect the commercial organization to conduct business with integrity, honesty, and ethical behavior, respecting contractual agreements, intellectual property rights, and environmental and social responsibilities.

Expectations of governments from a commercial organization

1. Compliance with Laws and Regulations: Governments expect commercial organizations to comply with all applicable laws, regulations, and standards, including those related to taxation, environmental protection, labor practices, and product safety.
2. Payment of Taxes and Duties: Governments expect commercial organizations to fulfill their tax obligations by accurately reporting income, paying taxes, duties, and other levies in a timely manner, contributing to the funding of public services and infrastructure.
3. Corporate Governance and Transparency: Governments expect commercial organizations to adhere to principles of good corporate governance, including maintaining transparency in financial reporting, disclosure of material information, and accountability to shareholders and stakeholders.
4. Job Creation and Economic Growth: Governments expect commercial organizations to contribute to job creation, economic growth, and prosperity by investing in innovation, infrastructure, and human capital development, thereby enhancing overall economic competitiveness.
5. Environmental Sustainability: Governments expect commercial organizations to adopt environmentally sustainable practices, minimize pollution, conserve natural resources, and mitigate the adverse impacts of their operations on ecosystems and communities.
6. Social Responsibility and Community Engagement: Governments expect commercial organizations to demonstrate social responsibility by supporting local communities, promoting diversity and inclusion, and engaging in philanthropic activities that address societal needs and challenges.
7. Competition and Consumer Protection: Governments expect commercial organizations to compete fairly in the marketplace, adhere to antitrust laws, and protect consumer rights by providing accurate information, ensuring product safety, and resolving disputes in a timely and fair manner.
8. Innovation and Technological Advancement: Governments expect commercial organizations to invest in research and development, innovation, and technological advancement to drive productivity, enhance competitiveness, and contribute to societal progress and well-being.

Expectations that society has from a commercial organization

1. Ethical Business Practices: Society expects commercial organizations to conduct their business with integrity, honesty, and fairness, adhering to ethical standards and moral principles in all aspects of their operations.
2. Environmental Responsibility: Society expects commercial organizations to minimize their environmental footprint, reduce pollution, conserve natural resources, and implement sustainable practices to protect ecosystems and mitigate climate change.
3. Social Impact: Society expects commercial organizations to positively contribute to the welfare of communities, including creating job opportunities, supporting local businesses, investing in social programs, and addressing societal challenges such as poverty, education, and healthcare.
4. Consumer Protection: Society expects commercial organizations to prioritize consumer safety, provide accurate information about products and services, uphold quality standards, and address customer concerns or complaints promptly and fairly.
5. Transparency and Accountability: Society expects commercial organizations to be transparent in their business dealings, disclose relevant information to stakeholders, and be accountable for their actions, decisions, and performance.
6. Diversity and Inclusion: Society expects commercial organizations to promote diversity, equity, and inclusion within their workforce, ensuring equal opportunities for all individuals regardless of race, gender, ethnicity, or other characteristics.
7. Innovation and Progress: Society expects commercial organizations to drive innovation, invest in research and development, and introduce products, services, and technologies that improve quality of life, enhance productivity, and contribute to societal progress and well-being.
8. Corporate Citizenship: Society expects commercial organizations to be responsible corporate citizens, engaging in philanthropy, volunteering, and community development initiatives that address social needs, support civic institutions, and build trust and goodwill among stakeholders.

Also check

• Sources of Raising Capital Notes for ICSE Class 10 Commercial Studies Chapter 13
• Capital Market Notes for ICSE Class 10 Commercial Studies Chapter 12
• Budgeting Notes for ICSE Class 10 Commercial Studies Chapter 11
• Costs Notes for ICSE Class 10 Commercial Studies Chapter 10
• Final accounts of Sole Proprietorship Notes for ICSE Class 10 Commercial Studies Chapter 9
• Capital and Revenue Notes for ICSE Class 10 Commercial Studies Chapter 8
• E-commerce Notes for ICSE Class 10 Commercial Studies Chapter 7
• Consumer Protection Notes for ICSE Class 10 Commercial Studies Chapter 6
• Advertising and Sales promotion Notes for ICSE Class 10 Commercial Studies Chapter 5
• Pricing Notes for ICSE Class 10 Commercial Studies Chapter 4
• ICSE Class 10 Commercial Studies Notes
• Product and Service Notes for ICSE Class 10 Commercial Studies Chapter 3
• Marketing Notes for ICSE Class 10 Commercial Studies Chapter 2
• Stakeholders in Commercial Organisations Notes for ICSE Class 10 Commercial Studies Chapter 1

Topics covered in ICSE Class 10 Commercial Studies Chapter 1

1.1	Meaning of stakeholder
1.2	Types of stakeholders
1.3	Internal and External stakeholders
1.4	Differences between internal and external stakeholders
1.5	Expectations of employers, employees, creditors and suppliers, government and society from a commercial organization.

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