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any group or individual who can affect or is affected by the achievement of the organisation's objectives
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direct ownership; shareholders, directors, minority interest owners
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economic or market stakes start learning
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economic interest; employees, customers, suppliers
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have interests; trade organisations, government agencies
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Economic theory of the firm start learning
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Organisation is supplied with materials by employees, investors, suppliers and provides products to customers
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economic theory and governments, political groups, communities, trade associations; you must aim for building mutually reinforcing relationships with each of these groups and do it this way that does not trade off the interest of other group
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any of these transactions between two parties may have negative consequences to the third party
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fragmented among various departments; focus on managing relationships; emphasis on buffering the organisation from stakeholders interfering with intend operations
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stakeholder collaboration start learning
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new approach; integrated management approach; focus on building relationships; emphasis on bridging and creating opportunities & mutual benefits; long-term goals; coherent approach driven by mission, values & corporate strategies
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Corporate Social Responsibility; economic, legal, social and environmental responsibilities of an organisation towards society
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adapting business strategies and activities that meet the needs of the enterprise and its stakeholders today while protecting, sustaining and enhancing the human and natural resources that will be needed in the future
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companies who choose stakeholder management use it as a tool to report on their company's progress
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What to report? 4 principles defining content start learning
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materiality, stakeholder inclusiveness, context, completeness
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1st principal of integrated reporting: Materiality start learning
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topics & indicators reflecting the organisations economic, social impact
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2nd principal of integrated reporting: Stakeholder inclusiveness start learning
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3rd principal of integrated reporting: Context start learning
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Organization's performance in wider sustainability context
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4th principal of integrated reporting: completeness start learning
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report contains significant material topics & boundaries to reflect the significant economic, social and environmental impact ts enabling stakeholders to assess the organisations performance
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a matter of concern related to the organisations decision and operations
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Issue - 2nd definition point of conflict in opinions and judgements regarding company's decisions and operations
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How to deal with sustainability issues? start learning
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1. Diagnosis - issue identification and analysis; 2. Strategic options (Reactive and Proactive)
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Reactive strategic options start learning
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1. Buffering - stonewalling the issue, denying there is an issue (defensive); 2. Bridging - accommodating stakeholder concerns, often after pressure
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Proactive strategic options start learning
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thought leadership - staking a positive leadership position on an issue that benefits stakeholders (also a form of bridging)
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Choice of strategy depends on start learning
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the intensity of the issue; the importance of an issue to the organisations stakeholder groups; values and beliefs of managers in an organization; increasingly growing perceptions of industry responsibility
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Why CSR activities are pursued? start learning
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They are pursued not only in order to improve profits, but to address important concerns of the wider society
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Sustainability - definition start learning
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the ability to meet the needs of the present without compromising the ability of future generations to meet their needs
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economic, social, environmental performance that simultaneously satisfies the demands of the stakeholder groups
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primary stakeholder groups start learning
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the constituents on which the firm relies for its continuous survival and prosperity - shareholders, employees, customers, suppliers, governments, communities
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secondary stakeholder groups start learning
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those who are affected or affect the corporation, but are not part of the transaction - trade unions, social groups, i.e. Greenpeace
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2 anpporaches to why stakeholders matter start learning
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1. Instrumental view - treating stakeholders well may indirectly help financial performance; 2. Normative view - firms ought to be self-motivated to do it right cuz they have societal obligations
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CSR that focuses on activities that are good for both the firm and its stakeholders; can be done in 3 ways
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Ways of creating Shared Value start learning
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1. Company can look for unmet social needs in the community; 2. Modifying their business practices to increase benefits for external stakeholders; 3. Initiatives can be launched that create value for a local community but indirectly benefit the company
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norms considered valid anywhere in the world - i.e. respect for human dignity
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