Primary Stakeholders

Stakeholders are sometimes divided into primary stakeholders, or those who have a direct stake in the organisation and its success, and secondary stakeholders, or those who may be very influential, especially in questions of reputation, but whose stake is more representational than direct. Stakeholder Research Associates Canada Inc. 2005, p. 11 - 13
Academics and business experts have attempted to categorise Stakeholders in order to identify and prioritise stakeholder groups, and to guide business decisions on which stakeholders to engage, and most appropriate engagement strategies.

Common categorisations used for segmenting stakeholders are:
  • Internal vs. External Stakeholders
  • Primary vs. Secondary Stakeholders
  • Voluntary vs. Involuntary Stakeholders
The Primary/Secondary stakeholder categorisation is frequently cited and in my experience managers tend to focus their efforts on primary stakeholders - so who are Primary stakeholders?

What is a Primary Stakeholder?

For Clarkson a Primary Stakeholder group is one that the corporation is dependent on for its survival. Five groups of stakeholders fall into the Primary Stakeholder category:
  • investors and shareholders,
  • employees, customers,
  • suppliers, and
  • a Public group of governments and communities who control infrastructure, markets and who require laws to be followed and taxes to be paid.
Carroll and Bucholtz take a different approach defining

primary stakeholders as:
  • employees,
  • stockholders,
  • vendors and
  • partners
who have a stake in the organisation's success.

Example Primary Stakeholders

primary stakeholders
For Carroll and Bucholtz government and community are secondary stakeholders, because they are more interested in the organization's impact on the community rather than having a direct stake in the organization's success. The difference in viewpoint – stakeholders as actors (groups the organization is impacted by) rather than those acted upon (groups impacted by the organization) leads to the different categorization of stakeholders.

Primary Social and Non-social Stakeholders

Wheeler and Sillanpaa take their categorization a step further splitting primary stakeholders into social and non-social. Primary Social stakeholders are:
  • Shareholders and investors
  • Employees and managers
  • Customers
  • Local communities
  • Suppliers and other business partners
Primary Non-social stakeholders are:
  • Natural environment
  • Future generations
  • Nonhuman species
(1997, p. 167). The image below shows Carroll and Bucholtz's example categorisation of stakeholders by Primary social and non-social and Secondary social and non-social.
example primary and secondary stakeholders
I am not sure of the value of the social / non-social sub-category it seems a little forced, although it does make a useful reminder that stakeholders may not be human or living. However, this is only seems a useful subcategory if you accept Clarkson's definition of primary stakeholders – i.e. those without whom the business cannot survive.

For me Stakeholder Research Associates Canada Inc. provide the clearest definition of primary and secondary stakeholders
Stakeholders are sometimes divided into primary stakeholders, or those who have a direct stake in the organisation and its success, and secondary stakeholders, or those who may be very influential, especially in questions of reputation, but whose stake is more representational than direct.

Secondary stakeholders can also be surrogate representatives for interests that cannot represent themselves, i.e., the natural environment or future generations. Stakeholder Research Associates Canada Inc. 2005, p. 11 - 13
Read more on other stakeholder categories: Internal Stakeholders, External Stakeholders, Project Stakeholders.

Primary Stakeholders - references

Bucholtz, A. K. and Carroll, A. B. 2012. Business and Society , Ethics and Stakeholder Management. 8th edition. South-Western. Cengage Learning. Latest edition

David Wheeler and Maria Sillenpaa. 1997. The Stakeholder Corporation: A Blueprint for Maximizing Stakeholder Value London: Pitman Publishing.

Max B. E. Clarkson. 1995. A Stakeholder Framework for Analyzing and Evaluating Corporate Social Performance. The Academy of Management Review, Vol. 20, No. 1 (Jan., 1995), pp. 92-117. [online] http://www.jstor.org/stable/258888 [Accessed 22 July 2016].

Stakeholder Research Associates Canada Inc. 2005. The Stakeholder Engagement Manual. VOLUME 1: THE GUIDE TO PRACTITIONERS' PERSPECTIVES ON STAKEHOLDER ENGAGEMENT. [pdf] Canada: Stakeholder Research Associates Canada Inc. Available at: http://www.accountability.org/images/content/2/0/207.pdf

Chiu, P. 2009. Looking Beyond Profit: Small Shareholders and the Values Imperative. Abingdon: Routledge. p. 33.

Read more on Stakeholder Management

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Stakeholder Management ebook

Happy Stakeholders - Pleasure and Displeasure List

Stakeholders - who are the Key Players? - Some Stakeholders are really important. How do you find them and get them on your side before they can do any damage?

Stakeholder mindmap - a mindmap showing stakeholders for an IT project.

Stakeholder Salience - an overview of the stakeholder salience model.
 
 
Stakeholder Management Templates