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Saudi Aramco is considered one of the largest producers of oil. The organization passed numerous transformations to become a global oil giant. Therefore, as a successful company, Saudi Aramco has a vast network of stakeholders that developed throughout history.
Saudi Aramco’s key stakeholders include the Saudi government, investors, suppliers, and customers. The Saudi government is the most important stakeholder as it finances the company and guides it through specific policies (Weijermars and Moeller, 162). Saudi Aramco also enjoys strong cooperation with various investors as they play an essential role in corporate development. The company attracts this stakeholder category with transparent conditions and various financial tools. It provides all the information regarding stock, bonds, dividends, and so further (Aramco Global). Having the necessary data, investors can plan their investments more accurately in terms of generating revenues. Besides, Saudi Aramco tries to attract new investors in response to climate change, encouraging them to fund projects related to water conservation or minimization of methane and carbon emissions (Aramco Global).
Finally, the company holds regular Assembly Meetings to share new information and strategic prospects with investors and shareholders (Aramco Global). Saudi Aramco offers its suppliers a convenient e-marketplace platform that allows these stakeholders to independently manage business interactions with the company (Aramco Global). SAP Ariba is the business-to-business network that simplifies the whole buying process (Aramco Global). Some of Saudi Aramco’s customers include big companies and small businesses that purchase various products such as ethane, asphalt, gasoline, and so further (Aramco Global). The company has a wide range of loading facilities and reliable channels to supply customers with the products (Aramco Global). As one can see, Saudi Aramco values its stakeholders and strives to create the most beneficial conditions to cooperate with them.
Saudi Aramco has a prominent history of its growth. It began in 1933 when Saudi Arabia and the Standard Oil Company of California concluded the Concession Agreement (Aramco Global). However, drilling began in 1935, before a thorough survey of the Saudi desert had been performed (Aramco Global). Success came in 1938 when commercial oil production was commenced (Aramco Global). In the late 40s, Saudi Aramco began to gather momentum by producing record-breaking volumes of oil (Aramco Global). After the Saudi government increased its interest in the company, it transformed from an oil producer and exporter into an integrated petroleum enterprise (Aramco Global; Weijermars and Moeller, 162). Nowadays, with the tendency to transition to renewable energy, Saudi Aramco has faced particular challenges.
The transition is a time and resource-consuming issue, thus, the company decided to focus on sustainability and privatization. In terms of sustainability, Saudi Aramco uses scientific approaches to develop new products. For instance, the organization plans to produce advanced plastics from carbon molecules that can be used instead of glass or steel in construction (Saudi Aramco, 7). Besides, as the company announces, this material can also be helpful in creating infrastructure for renewable energy (Saudi Aramco, 7). In view of this, the privatization of Saudi Aramco has become an option to create value and attract new investors (Weijermars and Moeller, 161). It has also been found that privatization can improve corporate financial performance until 2030 (Weijermars and Moeller, 165). Thus, the company strives to accommodate modern trends and simultaneously contributes to its success.
To conclude, Saudi Aramco had to pass a long way throughout history to become one of the world leaders in the oil industry. Although it has a huge network of stakeholders, it has faced challenges with the transition to green energy. Nevertheless, the company is always seeking new paths to develop further and prosper.
Works Cited
Aramco Global. Saudi Aramco. 2022. Web.
Saudi Aramco. Saudi Aramco Sustainability Report 2021: Energy Security for a Sustainable World, 2021.
Weijermars, Ruud and Moeller, Jonathan. “Saudi Aramco Privatization in Perspective: Financial Analysis and Future Implications.” Journal of Finance and Economics, vol. 8, no. 4, 2020, pp. 161-170.
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