Stakeholder Analysis and Business Environment: ICICI Bank Report

This report provides a comprehensive analysis of the business environment and stakeholders of ICICI Bank. It begins with an executive summary and an introduction that defines stakeholders and their significance in the banking sector. The report identifies functional areas within ICICI Bank, such a...Read More

Running head: BUSINESS ENVIRONMENT
Business Environment
Name of the Student
Name of the University
Authors note

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Executive Summary
This report examines different types of stakeholders, their identification in respect of a
specific industry and how they influence the organizational activities. The selected
organization for this report is ICICI bank. The stakeholders of the bank is identified through
PESTLE analysis. The interest of these stakeholders and their influential power is also judged
in this report. This stakeholder analysis would be instrumental in understanding the
expectations of the stakeholders for the organization and enhance the communication to
reduce risks. The business opportunities would be increased this way and the conflict of
interests between the stakeholders could also be managed. The report have a comparison of
the stakeholder’s interest in two different industry in the later part.

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Table of Contents
Introduction and background information.....................................................................3
Identifying the functional areas......................................................................................3
Identifying internal and external stakeholders and their roles.......................................4
Identifying the nature and degree of main stakeholders’ interests.................................6
Implications of conflicting interests...............................................................................7
Identify the level of main stakeholders’ influence.........................................................7
Stakeholder matrix.........................................................................................................8
Comparison..................................................................................................................10
Conclusion....................................................................................................................10
References....................................................................................................................12
Appendix......................................................................................................................15

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Introduction and background information
Stakeholders are the people who could affected or be affected by the business
operations and actions. Stakeholders could be an individual, group of people or a
constituency that have an impact or be impacted by the business’ activities. According to the
stakeholders theory the main objective of any business is to secure profit for the stakeholders.
Organizations have shared goals and it works with the stakeholders to create mutual benefits.
Therefore it is necessary for an organization to identify their stakeholders and assess the
impact of these groups on the business scenario. In most of the business sectors stakeholders
are owners, managers, customers, suppliers and government. The problem in managing
stakeholders is in the fact that different stakeholders of a company have different kind of
interest. Therefore, the company finds it difficult to manage and please all these stakeholders
at same time. This report will talk about the banking sector, specifically about the ICICI bank
stakeholders. It will discuss about external and internal stakeholders, degree and nature of
stakeholder’s interest and their influence level on bank’s activities.
Identifying the functional areas
The functional areas in an organization are the group of people or employees who
have similar set of expertise and skills. Mostly the operational and management departments
together are called functional areas. In the banking sector, the organizations like ICICI bank
has functional areas like Sales, Product Control, Compliance, Quantitative Analytics,
Finance, Human Resources, Operations and IT. Each of the functional areas have its own role
in company performance. As opined by Eskerod & Jepsen (2016), sales functional area in
banking have their managers, mortgage advisor, cashiers and so on. The product control is
operated by the middle office and this part of the banks are responsible for the trader support.
Analytics team is the most crucial one that consists of employees who do highly

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mathematical researches of the organizations. This is the part of banks like ICICI that
evaluates the risks and sets the future products and services of the bank. Another important
fictional area is the It team that takes care of the technological part of the bank operations.
The selected bank have a number of branches and their operations are documented, managed
and maintained by this team. This part has the responsibility for the ATMs, Payments, ECNs
reporting, risk, ledger and HR.
Identifying internal and external stakeholders and their roles
Stakeholder identification gives the opportunity to the organization to analyse the
expectations. Each stakeholders irrespective of their level of interest or influence, have some
expectations from the organization (Gonzalez-Zapata & Heeks, 2015). Determining the
stakeholder would provide the organization with plan of managing them in proper way. The
PESTLE analysis could be used to determine the stakeholders of ICICI bank.
Political
Various policies and practices that are set by the government influences the decisions
of an organization. In the banking sector, the policies related to the taxes, financial
exchanges, payments and other parts depends on the governmental rules. Again, the banks
have to pay certain taxes to the government. Therefore, the performance of these banks has
an impact on local and national government. Unions and local political parties are also the
stakeholders of ICICI bank.
Economic
Rise and fall of the market casts impact on the banking activities. The stakeholders
that are economically impacted by the banks are investors, owner, employees, managers and
consumers (Rajablu, Marthandan & Yusoff, 2015). Any loss or profit of the bank directly

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affects the share of profit for these stakeholders. For a company like ICICI bank, it is
necessary to identify the financial stakeholders to perform accordingly.
Socio-cultural
The socio-cultural factors not only influences the business profits, but is also
instrumental in identifying the stakeholders of that company. The organization like ICICI
bank’s business profits are depended on the nature and socio-cultural status of the consumers.
It is seen that there are differences in investment attitudes among the people living in the rural
areas and the people having urban background. The lifestyle of people is related to the
financial development of a bank. Socio-cultural factors thus helps the banks to understand the
demands and expectations of the stakeholders like customers, employees, competitors and
suppliers.
Technological
Banking sectors are depended on the technological interventions as these innovations
help them get competitive advantages and make their operations cost effective. The R&D of
any sector depends on the emerging technology. Therefore, the bank need to analyse the
interest of the stakeholders in association with the technological factors. This directly
influences the time and cost of bank activities and thereby stakeholders interest are related to
this factors of banking business.
Legal
Law and regulations are important for any business sector as that controls the
operational modes and procedure. In banking sector, the stakeholders that are related to the
legal aspects are government and consumers along with the owners, investors (Kumar,
Rahman & Kazmi, 2016). Changes in the governmental laws can impact how a bank would

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perform and how they will deal with the customers’ money. Tax rates, investment deals, loan
documents and other activities of ICICI bank is regulated by the law system.
Environmental
Environment is another crucial stakeholder of any business organization. The impact
of the business on the environment is analysed in the CSR report of the organization. The
CSR is the process through which a company maintains its social, ethical and environmental
responsibilities. This has been considered as a principle concern for the banking sectors.
ICICI banking organization is adopting several eco-friendly measures to save the
environment. Like there are ATMs and transaction process that cater less consume of paper
and saving the environment. This factor is impacts the almost all the stakeholder of banking
sector. The investors show their interest in the companies that have high CSR impact among
their competitors.
The internal stakeholder of the banking company ICICI are the one that are directly
linked with it, like the employees, managers, financial advisors, investors and owners. On the
other hand the external stakeholders are the customers, government, competitors and the
society (Nguyen & Mohamed, 2018). These stakeholders are influenced by the organization
as well, but they are not directly influenced by its activities.
Identifying the nature and degree of main stakeholders’ interests
The first step in identifying the stakeholder’s interest is to identify the stakeholders
potentially. The categorization is the next step where the stakeholder are separated according
to their power of influence and interest. In the banking sectors, it is quite evident that
different stakeholders have different kind and level of interest in company activities. The
ICICI Bank tries to deal with their stakeholder in a way that serves their goals. According to
Lin, Ho & Shen (2018), the potential beneficiaries may not be aware of the scope of

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interventions and they might show no interest at all in this. But in the banking sectors, all the
potential beneficiaries are actively involved in the process as they have economic concerns.
There are some stakeholders like the customers who are interested in the low interest rate and
high profit gaining for the bank. On the other hand, the stakeholder like the owner or the
investors expects highest profit with high interstate rate and huge number of consumers.
There are clashes and conflicts between the interests of the stakeholders of an organization.
Implications of conflicting interests
As the nature and degree of interest of the stakeholders are different, there are some
conflicts that an organization has to mitigate or balance in order to get best profit out of it.
Conflicts are common in the banking sector stakeholders as well. As stated by Ilinova,
Cherepovitsyn & Evseeva (2018), if the organization is unable to balance these conflicts there
could be obstacles in banking activities. The cause of this conflict is that, bank, as an
organization has to be involved in multiple party interests. The problem starts when it tries to
put its potential to act for the best interest of one party. The main conflict could be in the
interest of the shareholders managers and the bondholders. These three pillars of a banking
organization may share three different kind of interest. The shareholders are the owners and
they have financial interest while the mangers are the rule setters and decision makers.
Therefore, they may have to think of financial profits along with other functions of the
organizations. This might result in some change in profit margins. This ultimately result in
conflict of interest between this two parties and that could affect the performance of the bank.
Identify the level of main stakeholders’ influence
The influence of the stakeholders vary according to their power and interest in the
organization. The main targets of the effort of an institution are the primary stakeholders.
These are the customers and shareholders of the ICICI bank. The influence of these

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stakeholders in the activities of the bank is low. The customer’s interest is high but they do
not have much power to influence the whole process and actions of the bank (MINTS &
KAMYSHNYKOVA, 2019). The secondary stake holder are the employees. Managers,
NGOs and other organizations connected with the bank. The power of influence of these
group is medium. The manager are the decision maker and the employees work for the
organization. In banking, this stakeholders have medium interest and medium influence on
the institution as they have to manage the expectations of the CEO and as well as the
consumers. The key stakeholders are the policy makers and the government. They have the
ultimate power and influence in the banking sector. These stakeholders have the
responsibility to set the policies and principles for the organization (Chung & Crawford,
2016). Governmental policies influence the working process and actions of the ICICI bank.
The CEO and investors have immense impact on the activities of the bank. The profits share
are directly distributed among the higher authorities of the bank and therefore, they have only
financial interests with the bank.
Stakeholder matrix
High power Low interest
Government
Legal authorities
High Power high interest
Managers
CEOs
Project developer
Investors
Low Power Low Interest
Customers
Call center staffs
Low Power High Interest
Shareholders
Trainer
Other employees
Table: power and interest matrix of stakeholders

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(Source: Created by author)
The stakeholder’s matrix model has been developed by Mendelow in 1991. This
matrix takes into consideration two main components that influence the analysis. These two
aspects are power and interest. The power in this matrix means the influence ability of the
stakeholders upon the strategy of organizations or resources. On the other hand, the interest in
this matrix denotes the interest of the stakeholder in respect of the project success (Nguyen &
Mohamed, 2018). The matrix shows that there are stakeholders in the banking sector that
have supreme power of influence but they do not show much interest in company activities.
Management of these stakeholders are to be done in a strategic way.
The highly powerful people that have high interest in ICICI bank’s operations are the
key players. They have to manage with greatest effort. These people need to be engaged fully
in company operations and all information should be passed to them to make them satisfied.
Stakeholders of this group are directors and high level managers of the banking organization.
The second category people of the matrix are the one who have high power but are
less interested in the company activities and profits. These group of the people have to keep
satisfied at most (Looser & Wehrmeyer, 2015). But one must not try to serve too many
information to them as they do not have much interest. The local and governmental
authorities who set public policies for the bank are part of this group.
The third group is the people who possess high interest in the company procedures but
have limited power at their exposure. This group of people need to be kept informed about
the bank’s activities. The bank need to inform them adequately and communicate with them
regarding the major issues in the bank. Their views and recommendations could be
considered for the better inputs on issues of the bank. The trainers and the low paid
employees of the bank are supposed to be in this category.

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Low interest and low powerful people need to keep an eye on. These groups should
not be delivered with excessive communication but their levels of interest has to be
monitored. [Referred to Appendix 1]
Comparison
Stakeholders and their roles in the business differs according to the sectors. The
banking sector and the tourism sector are the two different business industry that have
different stakeholder interest and power. In the banking sector consumers possess low power
and their interest in company profit is not much. On the other hand, the consumers in the
tourism sector have the highest power. This industry gives utmost importance to the
customers as their nature and demand stands at the main point of business profit. Manager
and CEO in both of the industry have high power and high interest. The banking sector
stakeholders are mainly interested in the financial aspects and in tourism, customer’s
satisfaction plays the key role. In tourism industry the overall participation quotient of
stakeholders are higher than the banking industry. This is mainly because of the fact that, the
communication is much higher in the tourism industry in compared to the banking sectors.
Government policies play important role in both of the industry. The CSR of the banking
industry is quite different from that of the tourism sector. That means, environmental factors
as stakeholder issues have more influence on the tourism sector than that of the banking
sector. Therefore, it could be said, these two industries are quite different in their stakeholder
approach and they deal with different kind of interest and power levels.
Conclusion
Stakeholder analysis is the process through which the identification of the company
stakeholders are done in order to manage them in strategic way. In a company the

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stakeholders have different set of interest and power. Stakeholder analysis is important to
understand this matrix of power and interest. This helps in examining the role of the
stakeholders in company activities and to what extend they could influence the decision
making parameters. Stakeholders in the banking sector could be categorized in three main
sectors. The key stakeholders are the CEOs, managers, governments and the primary
stakeholders are the employees and the customers. The stakeholder’s matrix analyses how
these stakeholder should be treated according to their place in the interest and power grid.
The ICIC bank could manage the stakeholder’s interest and expectations in a better way if
business stakeholder analysis is done effectively. This analysis report would be helpful not
only in company profit but also in managing the conflicts between company’s internal and
external stakeholders. The importance of the analysis lies in the fact that each stakeholder of
the bank has the potential to seek change or resist the change in the organization. There could
be challenges in the operations of the bank if the stakeholders and their expectations are not
managed properly.

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References
Chung, K. S. K., & Crawford, L. (2016). The role of social networks theory and methodology
for project stakeholder management. Procedia-Social and Behavioral Sciences, 226,
372-380. Retrieved from:
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S1877042816308874-main.pdf
Eskerod, P., & Jepsen, A. L. (2016). Project stakeholder management. Routledge. Retrieved
from: https://www.taylorfrancis.com/books/9781315245881
Gonzalez-Zapata, F., & Heeks, R. (2015). The multiple meanings of open government data:
Understanding different stakeholders and their perspectives. Government Information
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Ilinova, A., Cherepovitsyn, A., & Evseeva, O. (2018). Stakeholder Management: An
Approach in CCS Projects. Resources, 7(4), 83. Retrievd form:
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Kumar, V., Rahman, Z., & Kazmi, A. A. (2016). Stakeholder identification and classification:
a sustainability marketing perspective. Management Research Review, 39(1), 35-61.

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responsibility: A collaborative framework for implementing social responsibility
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Looser, S., & Wehrmeyer, W. (2015). Stakeholder mapping of CSR in Switzerland. Social
Responsibility Journal, 11(4), 780-830. Retrieved from:
http://epubs.surrey.ac.uk/811275/1/looser%20wehrmeyer%20stakeholder
%20mapping%2015%20srj-06-2014-0071.pdf
MINTS, A., & KAMYSHNYKOVA, E. (2019). METHODS OF STAKEHOLDER
PRIORITISATION IN THE CONTEXT OF STAKEHOLDER MANAGEMENT.
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Nguyen, T. S., & Mohamed, S. (2018). Stakeholder management in complex projects. In The
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https://www.researchgate.net/profile/Tuan_Son_Nguyen/publication/326507031_STA
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PROJECTS.pdf
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doi=10.1.1.665.5661&rep=rep1&type=pdf

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Appendix
Appendix 1
Figure: Stakeholders Matrix
(Source: https://www.google.com/url?
sa=i&rct=j&q=&esrc=s&source=images&cd=&ved=2ahUKEwiN3si1h4XkAhXBF3IKHRt9
Bq4QjRx6BAgBEAQ&url=https%3A%2F%2Fwww.smartsheet.com%2Fwhat-stakeholder-
analysis-and-mapping-and-how-do-you-do-it-
effectively&psig=AOvVaw0vdXcsANYqoc7nVdRV4pWE&ust=1565964727232684)