Analysis of Stakeholder Theory in Non-profit Organizations Report

This report delves into the application of stakeholder theory within the context of non-profit organizations. It examines the core principles of stakeholder theory, emphasizing its importance in ethical organizational management and the cultivation of positive relationships with various stakeholders, including employees, creditors, suppliers, and the broader community. The report analyzes several articles, highlighting key concepts such as corporate social responsibility, stakeholder engagement through social media, and the significance of developmental culture in non-profit effectiveness. It also discusses the role of entrepreneurship in the non-profit sector and provides insights into how non-profit organizations can enhance their effectiveness through various management tools and strategies. The report concludes by underscoring the critical role of stakeholders in the long-term success and financial stability of non-profit entities.

LEADING
AND
MANAGING
NON PROFIT
ORGANISATIONS

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................5

INTRODUCTION
There are various companies in the world which work as a non-profit organisation. They
are opened for the welfare of the people. There main aim is not to earn profits but to do social
welfare. Further, non profit organisation are exempted from paying tax. It means that they have
no obligation to pay tax on the income received from different sources. These type of firms can
operate functions in research, religious, scientific or educational settings. There is a theory used
in the report which is called Stakeholders theory. The theory focuses on ethics, values and
morals of the business. It seeks to improve relationship between stakeholders and business by
improving efficiency of the business throughout the project or company. It is related to the
people who are connected to the organisation like the employees, creditors and more Jones
Wicks & Freeman, (2017). The theory focuses on suppliers, customers, employees, investors and
whole community. The report has various annotated Bibliography on various articles related to
the non-profit organisation and Stakeholders theory are given.
MAIN BODY
Stakeholder theory is related to organisational management and ethics which are
followed in the business. There are various people who are affected by it like employees,
suppliers, creditors and more. It is related to managing the organisation's moral and values like
Corporate social responsibility, market economy and more Andriof & Waddock, (2017).
Article 1 A conversation on ESG by Maria Gallagher And John Rotonti (A conversation on
ESG, 2019)
According to Maria & John, the world is expanding and the companies are very much
interested in corporate social responsibility. The company here is As you Sow which is a non
profit organisation aimed to correct the working of big companies. This company is very good in
creating change and by bringing change it can reduce risk. It is for the benefit of all the
stakeholders including employees, customers etc. The non profit organisation vision is to use its
staff and to create a safe and healthy world for all. The company is being supported by various
stakeholders as this is good for the world and future.
Article 2 Stakeholders Relationship Management by Lynda Bourne (Stakeholder
Relationship Management, 2016).
Organisation can be successful only when it has good relations with its people or
stakeholders. The aim of article was to increase the relationship of company with its
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stakeholders. Support from them requires a continuous engagement with them and it should be
done at the right time and they should be managed and their expectations should be fulfilled. The
company requires the support from each and every person in the organisation. All the
information is taken from the secondary source which is internet. If proper relationship is
managed then chances for surviving of company increases in the market. If an organisation want
to achieve all its goals and objectives then it must work together will all the stakeholders.
Article 3 In search of a Stakeholder Management theory for third sector organisations. By
Ricardo Corrêa Gomes , Luciana de Oliveira Miranda Gomes (Stakeholder Management
theory for third sector organisations, 2015).
According to Ricardo and Luciana, it can be said that stakeholders are very important for
the company. The aim of this article is to contribute in stakeholder theory by seeing the
importance of external environment in decision-making of third sector organisations.
Stakeholder theory is very good to provide analytical basis for investigation. Stakeholder are
very important to the company as their contribution is the profit of the company in future. The
information for the article is collected from different sources like documents, interviews and at
different time. The purpose of article is foundation which was created for helping the students in
managing their financial resources. At the end it was found that there are some stakeholders who
are able to shape the activities of the organisation and who play a very important role in the
company.
Article 4 Exploring Stakeholders participation by Katherine R. Cooper (Exploring
stakeholder participation in non-profit collaboration, 2014).
This study is about the participation of stakeholders in the educational outcomes of
students. According to Katherine, education is very important and without education it is
impossible for a person to succeed. Some say schools are not good because if teachers are not
good then student cannot learn. Stakeholder theory is very broad according to some scholars but
others say that the breadth is more which is good for both the company and the job. The
stakeholders were also contacted with the help of emails and different mediums. Stakeholders
take interest in many activities and this is very good for the organisation. In the end it can be said
that stakeholders should be used by the company in every part and in every work.
Article 5 Identification of Stakeholders of Public
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Interest Organisations by Liliana Hawrysz and Jolanta Maj (Identification of Stakeholders
of Public
Interest Organisation, 2017).
According to Liliana, organisations are responsible for the decision and actions on
society. Stakeholders should follow all the ethics and rules of the company. The social
responsibility of the organisation should be followed and company should always be motivated
from different things. Stakeholders should always be given right information so that they can
take correct decision for the company. The way company and stakeholders think is changing due
to various factors. There were around 500 companies taken for the analysis and many
questionnaire were developed Kannan (2018). The article concludes that there were various
information analysed and different documents were recorded and there is high value of
correlation indices. Regardless of individual opinion on the stockholders, it is very important for
a company to ensure good relation between different entities, groups and government.
Article 6 Corporate Diplomacy by Witold J. Henisz (Corporate Diplomacy, 2017)
According to author Vargas-Hernandez & Gonzalez (2018), it can be said that managers
are struggling so that they can win the strategic fight for the stakeholders. If the corporate
diplomacy resides then it will create real business for the company and stakeholders will get a
huge profit out of it. The communication between the shareholders and stakeholders is increasing
because of various strategic integrations. Most of the old firms are on the verge of corporate
diplomacy. Company is many times affected due to the conflict between them and the
stakeholders like politicians, activists etc. the companies now are bringing new strategies for the
development of stakeholder engagement.
Article 7 Developmental Culture and Effectiveness by Julie Langer & Kelly LeRoux
(Developmental Culture and effectiveness, 2019)
According to Julie & Kelly, non profit organisations have been always important to the
business as they provide proper places for innovation and changes. Innovation and risk taking is
the work of companies and no non profit organisation takes that risk. The culture-effectiveness
relationship is very important for these organisations. It provides a link between developmental
culture and non-profit organisational effectiveness. There are various sources used to gather
information and mostly internet is used. For a non-profit organisation culture should be well
developed and it should be effective .
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Article 8 Non-profit Organizational Effectiveness by Kellie. C Liket & Karen Mass (Non-
profit Organizational Effectiveness, 2014).
According to Kellie & Karen non profit organisation are taking proper care of its
accountability and they are showing various ways to increase effectiveness. Various tools are
now removed by financial tools are still used to see the accountability Maier, Meyer &
Steinbereithner, (2016). Stakeholders invest funds in various organisations and they can be non-
profit too depending upon various other factors. Managers are provided with tools that can help
the company in the working and suggestions can be provided to improve effectiveness.
Article 9 Understanding the Social Role of Entrepreneurship by Shaker A. Zahra & Mike
Wright (Understanding the Social Role of Entrepreneurship, 2019).
According to Shaker & Mike, the study of entrepreneurship is very advance nowadays.
There are five pillars on which social role of entrepreneurship is working. Various steps can be
taken so that proper integration can be done with the help of Corporate social responsibility,
BOP and Social entrepreneurship. There are various wrong effects of social entrepreneurship
which are reduces for the benefit of the organisation. Authors purpose is to show the role of
social entrepreneurship in a company. There are various sources from which the information is
taken like social media, internet and experienced people. In the end it was seen that both the
independent and corporate entrepreneurs will benefit from the social role and this is very
important.
Article 10 The use of social media for engaging stakeholders by Giacomo Manetti & Marco
Beluci (The use of social media for engaging stakeholders, 2019).
According to Giacomo & Marco, the payment from social media is very common and
there is a need of stakeholders engagement in it. Various test were done on internet to assess the
stakeholders and organisations interaction. The findings were that only small number of
companies are affected and the interaction is generally low. In the end it was found that the affect
of social media on stakeholders is less in this field where payment is related.
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CONCLUSION
The report has various articles and how different theories and the application of theories
be helpful in non profit organisation given. In different situations non profit organisation is
affected by different factors. Stakeholder theory is very important in knowing the people who are
related to the organisation Nowy & et.al., (2015). Stakeholders include employees, creditors ,
suppliers and many people who are directly or indirectly related to the company. Business should
focus on maintaining better relationship not only with shareholder's but also with other
stakeholder's like customers, suppliers etc. Stakeholders should be involved into every activity of
the business. Further, the Report has also explained that business should focus on corporate
social responsibilities towards stakeholders. Moreover, manager of the company should use
various tools to improve the effectiveness of the work. Firm should make efforts for providing all
the relevant details to stakeholders so that, they can make correct decisions regarding investment
decisions etc. Moreover, it has been concluded that, stakeholders are very important to the
company because they contributes to the profit of the company in the future.
REFERENCES
Books and Journals
Andriof, J., & Waddock, S. (2017). Unfolding stakeholder engagement. In Unfolding stakeholder
thinking (pp. 19-42). Routledge.
Jones, T. M., Wicks, A. C., & Freeman, R. E. (2017). Stakeholder theory: The state of the
art. The Blackwell guide to business ethics, 17-37.
Kannan, D. (2018). Role of multiple stakeholders and the critical success factor theory for the
sustainable supplier selection process. International Journal of Production
Economics. 195. 391-418.
Maier, F., Meyer, M., & Steinbereithner, M. (2016). Nonprofit organizations becoming business-
like: A systematic review. Nonprofit and Voluntary Sector Quarterly.45(1). 64-86.
Nowy, T. & et.al., (2015). Organizational performance of nonprofit and for-profit sport
organizations. European Sport Management Quarterly.15(2). 155-175.
Vargas-Hernandez, J. G., & Gonzalez, D. C. (2018). The Discussion on Stakeholders in Contrast
with the Shareholders Theory: Reconciliation to a Conscious Capitalism. SAMVAD. 14.
55-57.
Online
A conversation on ESG. 2019. [ONLINE]. Available
Through.<https://www.fool.com/investing/2019/07/25/esg-sustainability-as-you-sow-
andrew-behar.aspx>.
Corporate Diplomacy. 2017. [ONLINE]. Available
Through.<https://www.taylorfrancis.com/books/9781351287883>.
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Developmental Culture and effectiveness. 2019. [PDF]. Available
Through.<https://www.tandfonline.com/doi/abs/10.1080/15309576.2016.1273124>.
Exploring stakeholder participation in non-profit collaboration. 2014. [PDF]. Available
Through.<https://core.ac.uk/download/pdf/29152991.pdf>.
Identification of Stakeholders of Public
Interest Organisation. 2017. [PDF]. Available
Through.<file:///home/user/Downloads/sustainability-09-01609.pdf>.
Non-profit Organizational Effectiveness. 2014. [ONLINE]. Available
Through.<https://journals.sagepub.com/doi/abs/10.1177/0899764013510064>.
Stakeholder Management theory for third sector organisations. 2015. [PDF]. Available
Through.<https://pdfs.semanticscholar.org/9146/526fb8dbb3b426c91123cf4c90ad427f9
7d3.pdf>.
Stakeholder Relationship Management. 2016. [ONLINE]. Available
Through.<https://www.taylorfrancis.com/books/9781315610573>.
The use of social media for engaging stakeholders. 2019. [PDF]. Available
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1797/full/html>.
Understanding the Social Role of Entrepreneurship. 2019.[PDF]. Available
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