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What distinguishes derivative stakeholders from other stakeholders?

A) They possess no power over the corporation
B) They benefit the corporation without obligations
C) They hold power over the corporation despite not receiving benefits
D) They lack any influence on corporate decisions

User Juba
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1 Answer

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Final answer:

Derivative stakeholders, which may be considered as a type of secondary stakeholders, are different from primary stakeholders like shareholders in that they have an indirect relationship to the corporation and do not have direct control or receive direct benefits.

Step-by-step explanation:

What distinguishes derivative stakeholders from other stakeholders is that they are individuals or groups that have a secondary or non-direct stake in a corporation, as opposed to primary stakeholders who are directly involved with the corporation and can have significant influence or stand to benefit directly from the company's actions. The term derivative stakeholders does not appear to be widely recognized in the literature, which commonly references primary and secondary stakeholders; derivative stakeholders could perhaps be considered a subset of secondary stakeholders. Primary stakeholders typically have a direct financial stake, such as shareholders, who are the owners of the company's stocks, and have the potential to receive dividends and benefit from the appreciation of the company's value.

Contrary to the options provided in your question, the actual characteristics of secondary stakeholders (which could be considered akin to derivative stakeholders) may include having indirect influence or being affected by the corporation's practices without having direct power or receiving direct benefits.

Stakeholders, as opposed to shareholders, encompass a broader category that includes anyone affected by the corporation, such as employees, customers, suppliers, and communities. Since there are many types of stakeholders with varying degrees of influence and interest in a corporation, the description of derivative stakeholders would need to be much more precise to accurately determine how they differ from other stakeholders.

User Manjusg
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