Corporate Responsibility Master of Business Administration

Abstract

This paper will analyse a business that needs to be environmentally friendly and working towards creating positive social impact, against a need to achieve a certain degree of profitability required by the shareholders.

Introduction

The business is environmentally friendly towards creating a positive social impact. The competition is high therefore the business is having difficulties in winning bigger contracts. Other organisations and individuals gave financial support to the business to guarantee its long-term sustainability in exchange of 75% of the total shares. Also, with the financial support the business must have a 15% profitability per year, otherwise the shareholders can replace the CEO. Meanwhile the CEO has to write a strategic plan for the next 5 years having the business’ mission and vision, supported by the shareholders, but there is a thin line between achieving the profitability required and at the same being environmentally friendly as well as promoting a positive social impact. This approach will create additional costs that put at risk the profitability required by the shareholders.

The Plan

The CEO had to create a well-balanced approach towards achieving the profit required and the corporate social responsibility that is so important for the business, the community, and for the other stakeholders. As long as this balance was maintained the 5-year strategic plan could be implemented (Crowter & Guler, 2008).

The priorities are growth, productivity, and responsibility supported by a happy organisation. This growth is not just selling more, but increasing the business share of the market, growth in profit, and continuing growth in shareholder value. Here we can input the profitability requirement of 15% (Hall, et al., 2008).

Productivity means using the actual resources smartly and responsibly, generating savings that could be used to pay for the additional costs of the corporate social responsibility initiatives the company will pursue (Hall, et al., 2008).

At the end responsibility is fundamental to building a long-term shareholder value, pursuing commercial and financial objectives with a certain and needed respect for the social responsibilities (Hall, et al., 2008).

The plan would be to increase the gross turnover, operating profit, profit after tax and interest, number of employees, but reducing the number of factories to have less provisions for environmental potential responsibilities. By increasing profit, the tax contribution to the government would also increase, in line with the corporate social responsibility.

At the same time the business would expend more in environmental, health and safety issues, plus giving more in donations to charities and communities, always below the line of 15%, maintaining shareholders happy.

It is a strategy of fighting another day, being profit and keeping under the radar the need to always contribute to environmental, health and safety matters, and donating to charities and communities.

This struggle between money and responsibility cannot be fought head on, as the CEO cannot win this war totally, but the CEO can win battles, and many battles won can make a difference.

And this is how the CEO can and would convince the shareholders that this approach is the best option. The shareholders also know that money cannot be everything. It is also important to operate the business responsibly, otherwise not even a minimum of profitability can be achieved, after so many cases of corporate failures from environmental disasters, for example.

Conclusion

A part of reducing the number of factories, key performance goals would be to manage better the wastage generated by the company, like increasing the amount of hazardous waste sent to approved landfills, recycling and incinerating more hazardous and non-hazardous waste, and decrease the amount of non-hazardous waste sent to landfills.

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