Corporate Governance And Social Responsibility For Business Assessing – A Comparison Of Wesfarmers Sustainability Reports From 2014 To 2015

Wesfarmers’ Sustainability Approach

Describe about the Corporate Government and Social Responsibility for Business Assessing.

Hi Teresa

As I have been employed for assessing the sustainability performance of Wesfarmers Limited. Here, in this report, I am going to compare the organization’s sustainability reports of last two years 2014 and 2015. This report helps to identify the present issues along the improvements that the organization has been achieving. Through analyzing these sustainability reports, future scope of the organization can be outlined.

Before representing the sustainability reports, it is essential to demonstrate their sustainability approach.

The organization strongly believes in delivering satisfactory returns to its shareholders. The organization exports their products to South America, Europe, and Asia. Before analyzing the sustainability reports of the organization, it is essential to look over what they aim in their business. The vision, mission, and values of the organization help to understand the business goal. As per the vision statement of the organization, it is clear that the organization tends to become one of the most high performance resource companies and deliver value to their shareholder5s through initiative, innovation, and growth (Wesresources.com.au 2016). Along with that, they set their mission to establish as well as manage high quality portfolio of mining and resource assets (Wesresources.com.au 2016). Besides, they set their value in five factors that include people, ethical consideration, sustainability, organizational learning, and high performance  (Wesresources.com.au 2016).

The prime sustainability approach of the organization is to strengthen its financial performances (Wesresources.com.au 2016). Along with that, they pay heed on their five key sustainability areas that include people, energy, community support, environment, governance, and economic contribution (Wesresources.com.au 2016). The objectives and actions of the organization in these five key areas are demonstrated in the below section:

People: The senior management of the business believe that the stakeholders are the key people of their business. Thus, their prime responsibility is to provide safe, stimulating and ethical working environment to all the stakeholders. In this context, it is important to mention that safety is the highest priority of the organization.

2014 sustainability report of the organization shows that they achieved 66% reduction in the total recordable injury frequency rate. The overall rate remains same in the following year 2015. However, the below tables helps to analyze their safety goals and achievements.

	2011	2012	2013	2014	2015
Injury frequency rate	29.2	18.8	14.8	5.0	4.2
Workers’ compensation claims	47	27	26	13	11
Greenhouse gas emissions rate	694	690	668	627	869
Energy use (petajoules)	4	4.13	3.76	4.59	5.11
Water use (megalitres)	2,707	2,742	7,920	8,148	7,086

Table 1: Comparison in five major sections

(Source: Wesresources.com.au 2016)

The above table shows that the organizations has been continuously improving the two sections; Injury frequency rate, and Workers’ compensation claims. This clears the fact that the organization is paying heed on reducing the injury rates.

Comparison of Wesfarmers’ sustainability reports from 2014 to 2015

The above table shows that the Greenhouse gas emission rate has been successfully reduced in the year of 2014, but it increased again in the previous year. This clears the fact that they need to include more effective strategies in both their short term and long term objectives. Besides, the organizations is investing in new technologies so that they can increase their energy use. The table shows that the energy use was dropped in the year of 2013, and then increased in the following years of 2014 and 2015. Besides, they expect that they would able to enhance it further (Wesresources.com.au 2016).

Community Support: The organization believes in strengthening the community support. They invest and contribute money in order to build long-term community cohesion, leadership and innovation (Wesresources.com.au 2016).

Environment: As opined by Ortiz and Marín (2014), both the input and output of a business have direct as well as indirect impact on the environment. In this kind of business that the Wesfarmer has, the environmental impact includes land rehabilitation, solid and liquid wastage, emission to air, water usage, and many more. However, the management of the respective organization decided to reduce their environment footprint. The current result is showing their initiatives towards environment (Wesresources.com.au 2016). Moreover, Jones et al. (2015) stated that the natural resources are not unlimited and thus the business should enhance their innovative techniques so that they can produce more by using less. The above table shows that the water usage  has been increasing till the year 2014. However, it was decreased in the last year which is lower than that of 2013.

Economic Contribution: As per the statement of Castelo (2013), two most effective factors of a strong business are strong working environment and strong economy. However, here the business of Wesfarmer tend to enhance their economic contribution in order to strengthen their business and obtain long term sustainability. Besides, they decided to maximize their capacity to generate additional employment.

The above discussion clears the fact that they are able to improve their business operations by considering certain initiatives. However, the above discussion demonstrates that some social responsibility issues are there in their business decision making process. This is the reason that they have been confronting certain constraints in the path business growth. The sustainability report of 2014 show that they have failed in certain areas to meet their goals and objectives. On the other way, the sustainability report of 2015 shows that they are able to improved in those specific areas.

The Importance of GRI Guidelines in Sustainability Reporting

Here, it is important to mention that the sustainability approach is consistent with the GRI (Global Reporting Initiative) principles. However, it encourages the organization to concentrates as well as report on the matters which are complex to both the stakeholders and the business of Wesfarmers. The GRI G4 is adopted by the Wesfarmers group of companies as a part of their business.

The comparison between the above two reports are made with the help to GRI sustainability reporting guidelines. GRI is an international independent organization that helps the organizations and governments, business in empowering their sustainable decisions. More specifically, it helps in understanding the impact of their business on certain issues. The issues include climate change, human rights, and corruption (Wesresources.com.au 2016). Reporting principles, standard disclosure, and implementation manual are offered by the GRI sustainability reporting guidelines for the preparation of sustainability report of an organization (Levy and Brown 2013). The GRI guidelines helps to analyze the environmental, social and economic performances of an organization along with its impact. Petera and Wagner (2015) added in this context that the general standard disclosure of GRI guidelines are divided into seven specific parts that include:

• Strategy and Analysis
• Organizational Profile
• Identified Material Aspects and Boundaries
• Stakeholder Engagement
• Report Profile
• Governance
• Ethics and Integrity

The parts help to compare their sustainability reports of 2014 and 2015 in terms of their environmental, social, and economic performances. However, it has been found that the reporting guidelines are followed in a better way in 2015’s report comparing to that of 2014.

The reports are compared through checking on three elements that include Reporting principles, reporting guidance, and standard disclosure. It has been analyzed that both the reports included the seven specific parts that are mentioned above. This clears that the reports incorporated appropriate reporting principles and pursue reporting guidance in proper manner. However, in context of comparing both the reports, it can be said that the report of 2015 demonstrated all the fact is better manner. However, the details of their environmental, social and economic performances have not been illustrated well in the reports. In this context, it is important to mention that the facts are manifested to some extent in the report of 2014, but not in the report of 2015. The clear description would help to understand the initiatives that they have considered in their long term business decision making process. After analyzing both the reports, it can be said that the sustainability reports could have been written in better way where all the guidelines of GRI are included. Besides, it is clear that they have good future scope through which the can incorporate innovation further. 

Hi Teresa,

Here, I am going to discuss about the reports of another organization Fuji Xerox Australia Pty Limited. In this section, the sustainability reports of the respective organization of the years 2014 and 2015 would be illustrated. Before analyzing the internal contents of the reports, it is essential to let you know that Fuji Xerox Australia Pty Limited released their sustainability report of 2014 in Australia (Fxasustainability.com.au 2016). The sustainability report of the organization is not available in Australian website. This particular report has been produced by the Fuji Xerox Head Office in Japan (Fujixerox.com 2016). besides, I have noticed that some differences in the guidelines used for preparing the report in Japan in comparison to the report produced in Australia. The comparison between these two reports manifested in the below section.

The 2014 sustainability report of Fuji Xerox Australia Pty Limited is Australia’s tenth annual sustainability report (Fxasustainability.com.au 2016). The GRI guidelines include reporting principles and standard disclosure, and implementation manual. As per the sustainability report of 2015 of the respective organization, they believe that Corporate Social Responsibility must be the central point of their management (Fujixerox.com 2016). They deliver the highest priority to the society along with their customers. Considering this belief, the entire team engaged in CSR management process. In this context, it is important to mention that the senior management team of the organization value the expectations as well as the demands of their stakeholders. The 2015 report of the organization concentrates on the issues regarding CSR management of the company (Fujixerox.com 2016). This includes what the Fuji business aimed to achieve through their CSR management. Along with that, it focuses on their highest priorities in terms of CSR management. Besides, the report includes how they value their CSR management by unique characteristics of the business that helps to resolve the problems with their customers (Fujixerox.com 2016).

The  sustainability reports of Fuji Xerox Australia Pty Limited are prepared in accordance with the core of the G4 sustainability guidelines of GRI. The report of 2015 is prepared by consulting with the 2012 edition of the Japanese Ministry of the Environment’s Environmental Reporting Guidelines (Fujixerox.com 2016). The prime focus of the report includes in two sections; General standard disclosures, and Specific standard disclosure. The general standard includes the area of strategy and analysis, organizational profile, governance, report profile, stakeholder engagement, and identified material aspects and boundaries (Pérez?López et al. 2015). On the other way, the part of specific standard disclosure covered the areas of economic, environment, human rights, and society.

In 2014, they prepared report in accordance with the new GRI G4 guidelines for the first time and that is followed in the year 2015 also (Fxasustainability.com.au 2016). Thus, the 2014 report contains much details of their working process in comparison to the report of 2015. The relevant performance factors of the stakeholders of the respective organization is explained in the report of 2014. It consisted the time of their financial year of 1st April, 2013 to 31st March, 2014 (Fxasustainability.com.au 2016). However, the GRI guidelines are not used fully in the report of 2014, whereas the 2015 report includes all the guidelines. In this context, it is important to mention that in general standard disclosure, the strategy and analysis is demonstrated with the G4-1 and G4-2 guidelines (Fujixerox.com 2016). Besides, G4-3 to G4-16 guidelines are used in the part of organizational profile. In the context of comparing the 2014 and 2015 reports, it can be said that the company profile is explained in a much better way in the report of 2015 which is prepared by the head office in Japan. The report of 2014 which is prepared in Australia did not clearly discuss about their company profile. As it was the first time they considered GRI guidelines in their sustainability report, some of the guidelines were not used in a proper manner. Moreover, in order to identify material aspects and boundaries of the organization, they incorporate the guidelines of G4-17 to G4-23, and G4-24 to G4-27 guidelines are used in analyzing the stakeholder engagement (Fujixerox.com 2016). Though both these parts are explained by analyzing the financial years of 2013 and 2014 in the report of 2014 and 2015 respectively. Te part report profile consisted the guidelines of G4-28 to G4-33 which is based on the reports of the each year (Fujixerox.com 2016). Though, the report profile much clearer in the report of 2015 in comparing to the report of 2014. Along with the that they consider the guidelines G4-34 to G4-55 in the part of governance in report of 2015 which is missing in the report of 2014 (Fujixerox.com 2016). After that the G4-56, G4-57 and G4-58 have been incorporated in the part of explaining ethics and integrity. It has been found that the 2015 report presents a clear visual appearance in comparison to the report of 2014.

Part C: Conclusion and Recommendations

The study concentrates two different companies; Wesfarmers Limited and Fuji Xerox Australia Pty Limited. In Part-A, the study emphasizes on the sustainability reports of the organization  Wesfarmers Limited. In this particular section, the study compares their sustainability reports of the years 2014 and 2015. The study concludes that the report of 2014 is clearer to some extent in comparison to the report of 2015, and vice-versa. More than that, it is concluded that both the reports used the GRI guidelines in proper. However, the information given in the G4 guidelines did not cover all the aspects. Further, it concludes that the organization has been improving and it has the scope of further improvements.

The Part-B of the study concentrates on the sustainability report of Fuji Xerox Australia Pty Limited. In this section of the study, the reports of 2014 and 2015 has been compared. The study found that the 2014 report is prepare in Australia, whereas the 2015 report is prepared by the head office in Japan. Through analyzing both the reports, it is concluded that the company incorporated the GRI guidelines in 2014 for the first time. It is assumed that this is the reason on inappropriate use G4 guidelines. It has been found that the report of 2015 used the guidelines in a more specific way comparing to the report of 2014.

After concluding the entire study, a number of recommendations has been brought our here. The organizations confront sustainability challenges in the global market and the challenges are changing over time (Simmons 2016). The companies have to report the issues present in their business through preparing sustainability report (Kjaergaard et al. 2016). As stated by Salton and Jones (2015), GRI guidelines helps the organizations to prepare the reports in a more effective manner. It is recommended that the organizations should consider all the guidelines first and then put forth their information in several sections (Fuente et al. 2016). This enhances the visual appearance of the report (Bhaduri and Selarka 2016). Before discussing or identifying the business issues in the sustainability issues, it is important to declare the sustainability agenda of their business (Garavini et al. 2015). This helps to understand the goal of the business and purpose of their specific actions that they have undertaken. Along with that, it helps to determine the future scope of the organizations which means it determines the sustainability of the businesses (Jain and Islam 2016). 

After conducting this study I have learnt the importance of GRI guidelines in preparing sustainability report of a business. As per my viewpoint, GRI guidelines helps to represent the report in a more effective manner. Before conducting this particular study, I did not know about the importance of such reports. I used to think these reports are used only for knowing the business and gathering information about them. The study helps us to know that the sustainability reports is a presentation prepared for the board and committee functions. If I would appointed as an accountant or manager of an organization, I would always prioritize the ethical and moral factors first. It is way more important to think about the environment when one run mining business or similar businesses. If I had this kind of business, I would definitely not think only about making productivity and profits. The position of manager always remind me that I have huge responsibility of the business and its stakeholders as well. As a manager, I would always put my social responsibility in the top of my priority list. If I would appointed as an accounted or manager, this learning would help me much. Here, I have learnt how to use the GRI guidelines in the sustainability reports. Along with that, I came to know that these sustainability reports have impact on the board and committee functions.

Moreover, the study helped me to understand about the ethical norms of the business. It is important to mention that the managers of the organizations cannot deliver wrong information in their sustainability reports. During this study, I have also learnt about ASX principles of good corporate governance and corporate disclosure requirements. I came to know that a number of policies have been implemented through ASX in order to support the businesses in delivering ethical commitments in a way which is open and accountable to marketplace  and the shareholders. Besides, I have learnt that a manager should prioritize the corporate social responsibility of his business. The ethical norms and the international norms are included in CSR policies. Besides, the study gave me knowledge of the ESG. The environmental, social and governance are three central factors that help the businesses to measure their sustainability. Along with that, I came to know that it also helps in understanding the ethical impact of the business. However, after conducting the study and gathering in-depth knowledge about the GRI G4 guidelines, I can say that the sustainability is required in both the domestic and global market. Besides, in order to enhance the sustainability, the businesses should deal with their issues effectively. 

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