Questions:
1.Analyse an origin Australia’s current position and design a sustainability strategy based on a business case for the Identification and Implementation of sustainability imperatives that an Organisation should undertake for Competitive advantage.
2.Define and explain the Principles of Sustainability in a global Business Environment and Discuss Issues of future sustainability in the Corporate Environment
3.Identify and Compare Market and regulatory issues relevant to sustainability at the global and local level including voluntary reporting such as the triple bottom line.
4.Critically evaluate the increased requirements for mandatory reporting, and the benefits of voluntary reporting, as well as the guidelines available and the risks associated with external reporting.
According to the traditional business model adopted by companies the focus was mostly on the growth and development of the company regardless of the consequences the strategies may have on the society and the environment. With globalization and the changed dynamics of the business environment all over the world corporate look in to the business model of the company from a different perspective. The recognition of the responsibility the corporate have towards the society or the environment has changed the way the business operated in the past. The growth and development strategies of the corporate houses are now based on the requirements of the current situation without hampering the capability of the future to meet their requirement at that point of time. Sustainability has three pillars: environmental economic and social (Milne & Gray, 2013).
The company is regarded as the leading power supplier of Australia, New Zealand and the Pacific. The company is popular among the B2B as well as B2C clientele based on the efficiency and services. Origin has a rich heritage in the energy industry owing to the time the company has been serving in the industry, the company engages in energy exploration, retailing, production and power generation. Operating in a heavy industry enables the company to grown in the process of changing dynamics of the industry without hindrance (Home page, 2017).
The company can be deemed as a contemporary organisation as it was formed in the new millennium. Headquartered in Sydney as well as in New South Wales the company boasts a heritage of goodwill and good reputation among the stakeholder of the company as well as in the industry. Origin is the largest energy retailer in Australia and serves approximately 4.217 million customers; the consumers of the company are starting from domestic usage to small business units to large energy consumption units. The company also leads in the sector of supplying low carbon based products in Australia. Origin also has around 160,000 shareholders (Home page, 2017).
The mission and vision of the company is to change and re-shape the entire energy supply chain.
The objectives of the company are:
Since inception of the company, it has been focused on changing the ways in which the energy supply chain works, the current position of the company is that it is leading in the energy supply industry in Australia. The company focuses on two businesses and develops strategies based on these: emery market leadership, natural gas and LNG production (Home page, 2017). In order to develop the business and grow in the industry of operation the company is currently concentrating on three priorities: Improving returns and growing renewable, Improving competitiveness and delivering growth in natural gas as well as LNG and management and funding of the capital (Savitz, 2013)
The concept of triple bottom line was developed by John Elkington in 1994; according to Elkington companies should not have a single point of focus while strategizing for the growth and development of the company. He said that companies should keep their resource concentrated on three aspects rather than one (Glac, 2015). These three aspects are described as 3Ps: Planet, people and price. He says that for an organization environment and society are equally important. As the operations of the organisation are influenced and revolves around these aspects. The idea of triple bottom line contemporary and sets a juxtaposing idea with the traditional business model that companies used to follow previously. The traditional concept just concentrated on the development of the business from an economic perspective as mentioned above, environment and societal responsibilities were recognized as a burden on the company speculated as liability as the company had to invest in these aspects which eroded the profit. The goal and objectives of the corporate units focused around the economic and financial growth of the business (Glac, 2015). For example: organizations that operated in the energy sector did not concentrate innovation and research on developing alternatives as the non-renewable resources are limited. The process of sustainability begins with the thought of the future generation and previously that was absent. Corporate houses always tend to calculate the process of investment on the return that would offer to the growth and development of the company. Sustainable project are mostly based on intensive research investment as well as the installation process also requires capital hence the companies are apprehensive of the investment as it does not assure positive return on investment (Milne & Gray, 2013). This concept urges corporate houses to take responsibility of the resources they have received from the society and the environment to grow and develop their business. When one enjoys liberty and freedom of operation it is also the duty of the company to comply with the duties and responsibilities that come with the freedom (Henriques & Richardson, 2013). Companies are supposed to understand the positive or negative impact they pose to the society and the environment and strategize accordingly to combat in case of any negative impact. For example: Energy industry has a large impact on the environment as a lot of drilling and mining causes a number of environmental issues which should be recognized by the companies in this industry and should work towards combating these problems.
The concept of corporate sustainability is supported with four pillars, corporate social responsibility (CSR), stakeholder theory accountability and sustainable development. This is a contemporary concept in the management system. It is an alternative to the traditional “profit making” objective of the corporate. This concept recognizes that fact that it is significant for a company to initiate corporate growth in order to channelize the profit in resources for the future of the company. At the same time it also recognizes the responsibility the companies have towards the development in a sustainable manner (Benn, Dunphy & Griffiths, 2014). Sustainable business is referred the development and creation of conservation and preservation approach of the environment, development of societal equity, promotion of the well-being of the people associated with the organization and support fair trade practice. Corporate sustainability ensures a process of strategic planning and coordination of the business operation with the social and environmental requirements in order to act responsibly and ethically (Ferrell, Hirt & Ferrell, 2016). Innovation is as a significant approach towards the development of a sustainable business model. Innovation in terms of technology, policies, and decisions can help the company ensure that the principles of sustainability are met as per the guidelines that are stated below. Organisation must follow an adaptive path of operation in order to embrace and incorporate any new idea and innovation (Halpern et al. 2013).
Business environment can be internal and external where the company has control over the internal environment; the dynamic of the external business environment is not under the control of a company. United Nations has ten principles of corporate sustainability; it states that sustainability is the direct impact of the values and principles that are followed by an organisation. There are four areas stated by the UN which has to be considered by a company in order to follow sustainable development: anti-corruption, human rights, labor and environment. By including the Principles stated by the UN Global Compact into the strategies, policies and procedures of the business the company will be establishing a culture of integrity. Corporate houses will not only uphold their basic responsibilities to the people and environment, but also prepare the organisation for future prospects (The Ten Principles of the UN Global Compact, 2017). The ten principles are:
The company issues the sustainability report on an annual basis on the official website. Origin focuses on several aspects when it comes to sustainability like: health safety and environment, people and culture, land access and coexistence, communities, customers, water, waste, process safety, policy, communities and supply chain. The company is firstly shutting down the only coal-firing power station as a step towards curbing the carbon emission. This station is said to be shut down by the early period of 2030. The company is focused on changing the way the energy sector perceives the carbon emission issue. Carbon emission is regarded as one of the severe concerns of global climate change. The company engages in materiality analysis in order to understand the impact of strategies. Some of the aspects that are considered while assessing are: the level of risk, the level of stakeholder involvement and topicality of the factors (Origin Sustainability Report 2017, 2017).
According to the World Council for Economic Development (WCED), sustainable development is the procedure incorporated by the organizations which ensures that the company will collect the requirements and resources based on the current position of business without negotiating the requirements of future generation. Some of the issues in future sustainability are:
The position of the economy on a global scale is fragile and coupled with the changing dynamics can pose a threat to the idea of sustainable development in developed countries as well
Allocating jobs to the labor force that is available is a real challenge and an issue with the concept of sustainable development
Policies of the government all over the world can also be an issue with imposing the strategies that are ideated by the organisation
Lack of knowledge of the emerging threats regarding the environment or the society may pose a threat towards the future of the sustainable development model.
The unanticipated accelerated growth and impact of the issues that were persisting in the past can pose a threat and can be a major issue in the steps taken by an organisation towards sustainable development (Miller et al., 2014).
Depending on the scale of operation of the business the sustainability measures are taken by an organisation. If the organisation is operating on a global platform the scale of policies and decisions regarding sustainability will also increase. Hence, finance is the main issue when sustainability is concerned (Herbohn, Walker & Loo, 2014).
Another major issue apart from finance is the scarcity of other resources in the organisation. Based on the industry of operation and on the nature of the business the resources can be allocated.
Shift of focus from environment and climate has been identified in recent observation, economic and financial crisis gaining precedence (Idowu, Zu & Gupta, 2013).
Organizations on a large scale are yet to consider natural calamities and naturally occurring environmental depletion as major issues and they have to be dealt with similar intensity as with man-made issues.
Constantly growing population as well as increased amount of consumption can also be considered as an issue of a global scale in sustainable development (Lozano, 2015).
Ethics and principles followed by an organisation is more than just doing what is right and avoiding what is wrong. Many times the concept of right and wrong become subjective and this is where a guideline, principle or a regulatory authority becomes significant. Based on the home country or the country of operation law and principles are set by the government for organizations to follow in terms of adopting sustainability and ethical growth (Herbohn, Walker & Loo, 2014).
United Nations monitor all the countries that are a part of the UN in terms of following the principles laid down by the organization. The issues with these principles are that they are not specific and are also not based on the industry, scale or nature of the business. These regulations are general guideline of ethics (Lozano, 2015).
Every company must have a code of ethics of their own based on the values and principle of the organisation and the need and requirement of the society and the environment the organisation caters to. Environmental law on a global platform should be implemented by every country to keep a check on the environmental depletion caused by corporate organizations. In most of the country there are laws but there is an issue with the enforcement and that needs to be checked by the government (Godha & Jain, 2015).
To analyze the impact of a company on the environment and the society, sustainability reporting has been regarded as one of the best ways. It shows the position of the company with respect to the competitors in the market in terms of sustainability. By adopting this process the company can be more transparent in their operation as well as gain confidence form the stakeholder. But the question here is should this process be made mandatory by laws and regulations. As CSR is a process that is based on the values and principles of the company it is important to have clarity in the process of implementation by the company the legal aspect will make the process unnecessary complicated. On the other hand, there are institutions that need an external force to recognize the responsibility. A check is required for such companies, though in today’s business environment every organisation small or big realizes the importance of sustainability which makes voluntary reporting mandatory (Ioannou & Serafseim, 2017). GRI or global reporting initiative is an independent body that operated globally to provide helps governments and businesses organizations. The enterprise helps organizations to understand and communicate the influence of business on sustainability issues based on the environment and society. GRI is regarded as one of the pioneer institutions to encourage and support the concept to sustainability reporting. There are also other independent bodies which help the corporate sector to develop sustainably (Godha & Jain, 2015).
Conclusion
Some of the industries that have regularly received criticism globally because of the impact they have on the environment and the society are the oil and gas industry, energy industry, mining industry etc. With the changing dynamics of the business environment the corporate sector have adapted to the concept of sustainability to a great extent. Origin is a company that is contemporary in its approach towards sustainability. The company approaches several aspects in the sustainable development process and issues a voluntary repot on an annual basis which is easily available on their official website. In this report the company clearly states the objectives of the approach. It analyses each and every aspect in an descriptive manner so that it is easily understandable by the reader. Origin has the mission of changing the perspective of the energy sector by pioneering in some of the measures.
Reference list
Benn, S., Dunphy, D., & Griffiths, A. (2014). Organizational change for corporate sustainability. Routledge.
Ferrell,O.C. Hirt G.A., Ferrell. L. (2016).Business: achangingworld(10th ed.) New York: McGraw-Hill Irwin.
Glac, K. (2015). Triple Bottom Line. Wiley Encyclopedia of Management.
Godha, A., & Jain, P. (2015). Sustainability reporting trend in indian companies as per GRI framework: a comparative study. South Asian Journal of Business and Management Cases, 4(1), 62-73.
Halpern, B. S., Klein, C. J., Brown, C. J., Beger, M., Grantham, H. S., Mangubhai, S., …&Possingham, H. P. (2013). Achieving the triple bottom line in the face of inherent trade-offs among social equity, economic return, and conservation. Proceedings of the National Academy of Sciences, 110(15), 6229-6234.
Henriques, A., & Richardson, J. (Eds.). (2013). The triple bottom line: Does it all add up. Routledge.
Herbohn, K., Walker, J., & Loo, H. Y. M. (2014). Corporate social responsibility: the link between sustainability disclosure and sustainability performance. Abacus, 50(4), 422-459.
Home page. (2017). originenergy.com.au. Retrieved 30 November 2017, from https://www.originenergy.com.au/about.html
Idowu, S. O., Zu, L., & Gupta, A. D. (2013). Encyclopedia of corporate social responsibility (Vol. 21). N. Capaldi (Ed.). New York: Springer.
Ioannou, I., & Serafeim, G. (2017). The consequences of mandatory corporate sustainability reporting.
Lozano, R. (2015). A holistic perspective on corporate sustainability drivers. Corporate Social Responsibility and Environmental Management, 22(1), 32-44.
Miller, T. R., Wiek, A., Sarewitz, D., Robinson, J., Olsson, L., Kriebel, D., & Loorbach, D. (2014). The future of sustainability science: a solutions-oriented research agenda. Sustainability science, 9(2), 239-246.
Milne, M. J., & Gray, R. (2013).W (h) ither ecology?The triple bottom line, the global reporting initiative, and corporate sustainability reporting. Journal of business ethics, 118(1), 13-29.
Origin Sustainability Report 2017. (2017). Retrieved from https://www.originenergy.com.au/about/sustainability.html
Savitz, A. (2013). The triple bottom line: how today’s best-run companies are achieving economic, social and environmental success-and how you can too. John Wiley & Sons.
The Ten Principles of the UN Global Compact. (2017). unglobalcompact.org. Retrieved 30 November 2017, from https://www.unglobalcompact.org/what-is-gc/mission/principles
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