Describe the relationship between a firm and its stakeholders.

Stakeholders are individuals or groups that have interests, rights, or ownership in an organization and its activities. Each stakeholder group has an interest in how an organization performs and is interdependent with it. These stakeholder groups can benefit from a company's successes and can be harmed by its failures and mistakes. Similarly, the organization has an interest in maintaining the general well-being and effectiveness of those stakeholder groups. If one or more of the stakeholder groups were to break off their relationship with the organization, the organization would suffer.