Shareholder Expectations

Management of Shareholder Expectations

Speaking of an organization and its running or functioning, shareholders are very important in it. Before going on to depth of explanation of defining what are the duties, effects of shareholders on any organization, what an organization can get from shareholders, we need to define the term shareholder. Shareholder could be a single person, a group containing few people or even an organization having huge list of people working in it that apply either a direct or an indirect stake or effect in an organization’s operations and functions but at the same time, an organization’s policies, procedures, actions and objectives can easily effect this shareholder. Managing stakeholder’s expectation is considered

For example, any shareholder’s major duty is to increase his/her investment stake within the organization so that its level of wealth could go rise and with such rise, it would be quite clear for an organization to return good amount of investment to a shareholder, as well. But even an organization start to think about increasing return on investment by making short time span decisions, this step can easily affect either customers or even employees. It’s another case when an organization is such capable of performing or keeping up a strategic competition with other competitors, it can easily satisfy every single need of a shareholder but for those organizations who are suffering and their earning is below the rate of return, they should try out some other plans in order to create balance within the team or an organization. There is another state where there is an average rate of return. In this state, mainly organizations suffer to satisfy each and every shareholder for his/her needs or demands. Below than average is quite a crucial and critical time or state for any organization because at this stage, any shareholder can either stop his/her investment within an organization or either fully rejects the proposal for following any particular organization or business. An example could be seen whenever an organization reduces investment on research or development of expenditures, this clearly give them a good chance to increase the short term profits or benefits to the shareholder acting as a dividends. On the other hand, this decrease of investment on research and development of expenditure could decline the rate of success of long term plans that could affect any organization’s performance in today’s competitive world. This could give rise to issues such as insecure feelings of an