A sustainability report of a firm is described as a report that provides various data and information regarding the environmental, economic, governance and social performance (Ioannou and Serafeim 2016). Therefore, in other words, it can be said that the preparation of the corporate social responsibility or sustainability report is an important factor as this determines the present condition of the firm based on its financial, economic and social performance (Bebbington, Unerman and O’Dwyer 2014). Thus, investors have been found to study and analyze this sustainability report of any organization before investing in it. In this report, the firm named Singtel has been selected that conducts itself in an environmentally and socially responsible way in order to study and analyze its sustainability report and to understand its financial, social and environmental performance.
The organization Singapore Telecommunications Limited is also known as Singtel in short and it was earlier known as “Sing Tel”. It is a telecommunication firm of Singapore that is combined with mobile subscriber and has a base of about 600 million consumers (Info.singtel.com 2017). The company is operated globally across 25 nations (as per the annual report of the year 2016). According to the annual report of 2016, Singtel is considered as one of the largest operators of mobile network in the nation and ranked between 20th and 30th across the world (Info.singtel.com 2017). Until the year 1995, this firm was known as Telecommunications Equipment. The organization is a public listed company that was founded in 1879 and is headquartered in Singapore. The main products of Singtel are mobile telephone and fixed-line, fixed-line services of internet and broadband, IT, network services and digital television. The mission of the firm is “to break barriers and to build bonds”. Singtel employs about 25000 employees across the world (Info.singtel.com 2017). As per the annual report of Singtel of the year 2016, its revenue increased to $ 16.961 billion SGD, operating income increased to $ 5.013 billion SGD and profitability increased to $ 3.871billion SGD (Info.singtel.com 2017). Lastly, it can be said that the particular firm considers creation and delivery of sustainable value to its shareholders, customers as well as staffs as a principle aspect.
The financial or economic performance of Singtel can be better understood from the following comparison analysis of the particular firm for two years i.e. 2015 and 2016.
|
2015 (S$) |
2016 (S$) |
||
|
(A) |
Total Assets |
42067 |
43566 |
|
Total Liabilities |
17299 |
18563 |
|
|
Total Owners Equity |
24733 |
24989 |
|
|
(B) |
Profit Earned |
3785 |
3858 |
|
Less: EPS |
23.73 |
24.29 |
|
|
(C ) |
Total Ordinary Shares Issued |
15356015423 |
15387022643 |
|
(D) |
Profit Received by Shareholders |
||
|
Less: DPS |
17.50% |
17.50% |
|
|
(E) |
Net Cash flows from Operating Activities |
5787 |
4648 |
|
(F) |
Net Cash Flows from Investing Activities |
-3557 |
-2740 |
Based on the above chart, it can be said that the total assets of the firm Singtel increased from the year 2015 to 2016 and simultaneously the total liabilities of the corporation also increased with the passage of time. However, the total owners’ equity increased from S$ 24733 million in 2015 to S$ 24989 million in the year 2016 (Info.singtel.com 2017). This implies a better financial condition of the corporation. In addition to this, it can be said that the profit earned by the particular firm Singtel increased from S$ 3785 million in the year 2015 to S$ 3858 million in the year 2016. Therefore, this has resulted into increased earnings from each share that is EPS. It has been found that the EPS was S$ 23.73 in the year 2015 and S$ 24.29 in the year 2016. This implies, the earnings or the profit of the firm increased with the passage of time (Junior, Best and Cotter 2014). Therefore, it can be said that the specified firm Singtel has a healthy financial condition.
It has been found that in the financial year 2015, the firm Singtel mainly puts focus on the establishment of the foundation for the wider strategy of sustainability. On the other hand, in the financial year 2016, Singtel built momentum and additionally sought to raise the influence of its sustainability proposals. Singtel foster and promotes an inclusion culture for the community’s vulnerability and help in realizing the potentiality to be equal and contributes towards citizens. Moreover, it has been noted that since the year 2002, the firm has invested an amount of over S$ 33 million for the education purpose of the children and the youth having special requirements (Hahn and Kühnen 2013). Additionally, Singtel contributes S$ 2 million for learning center, for providing training, transition and curriculum to work support for the individuals with special requirements and disabilities (Buhr, Gray and Milne 2014). Singtel addresses cyber security and extends the wellness of the cyber. The reason behind this is that the security and the safety in a constantly growing connected and digital world have become a significant concern for the particular organization, broader community and its customers. The particular organization persists to invest in developing the capacity of internal operations for protecting the privacy and data of the consumers. In addition, recently Singtel set up an institute named “Singtel Cyber Security” that offers training to both governments and enterprises for expanding the skills of security and cyber (Cho et al. 2015).
Additionally, Singtel recognizes that in present days, there is a need for addressing the process by which infrastructures, communities and economies adapt and construct resilience progressively for influencing the change in the climate. The firm strengthens its environmental execution and puts emphasis on two main regions of climatic change and influence mitigation (Info.singtel.com 2017). Therefore, it can be said that the specified organization mitigates the impact of the climatic change. The energy consumption and along with it the carbon footprints are considered as the primary focus of the management as the network of the firm enriches for supporting the fast growth of the usage of data and coverage and also improved the experience of the consumer (Ball, Grubnic and Birchall 2014). Furthermore, the firm Singtel highlights on increasing advocacy and awareness for the corporate sustainability among the individuals, such that it becomes the part of the value system of the organization. Therefore, the corporation ensures a sustainable supply chain by implementation of sustainable management strategy that helps in better understanding and addressing the potential social, governance and environmental risks.
According to the sustainability report of the firm for the year 2016, it has been found that the organization Singtel also invests for its people and for supporting the diversity. It has been noted that the key pillars of the sustainability strategy of Singtel include – people, environment, community and marketplace and consumers. Therefore, it can be said that these pillars help to build the structure of the sustainability priorities of the firm and allows it to display a strong bondage between the sustainability and corporate strategies of the organization. Thus, these strategies help in shaping a better future of the firm, its employees and the people of the society.
However, as per the performance highlights of the financial year 2016, the firm Singtel has increased its community investment from S$ 10.1in 2015 to S$ 26.7 in 2016 and the total staff volunteering hours also increased from 15109 to 15981 (Rinaldi, Unerman and Tilt 2014). Based on the report, total percentage of male employees increased from 62% in 2015 to 63% in 2016. However, the percentage of female employees decreased from 38 % in 2015 to 37 % in 2016 (Info.singtel.com 2017). It has been found that the rate of employee turnover has increased from 13 % to 15 % in the year 2016. Thus, it implies a negative aspect of the firm Singtel. Moreover, the firm increased its investment in the training by S$ 0.90, but the average training hours for every staff decreased from 33.3 to 32.5 in 2016 (Lynch, Lynch and Casten 2014). Additionally, in perspective of the safety and health of the employees, the injury rate in the workplace has decreased from 1.4 in 2015 to 1.3 in 2016, indicating a positive change of the firm Singtel towards the society (Info.singtel.com 2017). However, the rate of accident frequency remained constant i.e. 0.6 for both the years 2015 and 2016 and the rate of accident severity also declined from 7.4 in 2015 to 5.9 in 2016 (Martínez?Ferrero, Garcia?Sanchez and Cuadrado?Ballesteros 2015).
Finally, it can be said that both the pillars of the sustainability report that are – community and the people fall under the social performance of the firm Singtel. Among the community pillar, the top material issues of the organization Singtel include – firstly, addition of the susceptible groups and secondly, online safety and digital citizenship (Info.singtel.com 2017). On the other hand, among the pillar named people, the top material issues of the firm involve – firstly, retention of the employees and attraction of talented people, secondly, education and training and thirdly, safety and health of the employees of the corporation (Higgins and Larrinaga 2014).
It has been found that the carbon emission of the corporation Singtel grew 3.1 % based on yearly basis in comparison to 4.3 % in the earlier year (Pérez?López, Moreno?Romero and Barkemeyer 2015). Therefore, it is considered as one of the achievements of the corporation Singtel in the financial year 2016 in the field of the sustainability pillar “environment”. Moreover, it has been noted as per the sustainability report of Singtel that the firm has overall seventeen goals and one of them is regarding the welfare of the environment that is “Climate Action” (Maas, Schaltegger and Crutzen 2016). This goal implies that the particular corporation would take immediate action in order to fight against the changes that take place in the climate and its influences. Moreover, Singtel committed to manage, minimize and understand the footprint of the environment across the value chain of the firm. This also includes suppliers, consumers and operations of the particular business. From detailed study and analysis of the sustainability report of the company Singtel for the year 2016, it can be said that the company mainly puts emphasis on the improvement of the efficiency and energy performance. These occur mainly at the moment when it continues to examine the feasibility of the sustainable sources of energy on a much forceful level. In addition to this, the corporation also focuses on the development and the maintenance of a resilient network in the process of change in the climate.
Singtel mainly puts focus on the environmental activities that are composed based on four pillars (strategic) and these include – firstly, addressing the change in the climate and secondly, integration of the agenda of the environment into the value chain of the firm (Unerman and Zappettini 2014). Thirdly, the pillar includes engagement of the stakeholders of the firm on the issues that are related to the environment and lastly, the responsibility of the resource and the product. Moreover, it has been found that the total waste, non-hazardous and hazardous (tones) increased from the year 2015 to 2016 that is from 4015 to 4223 (Info.singtel.com 2017). However, the environmental strategies of the corporation Singtel as a whole can be better understood from the following figure.
Figure 1: Environmental Strategies of Singtel
(Source: Info.singtel.com 2017)
Finally, it can be said among the pillar named environment, the top material issue of the corporation is the energy management and the change in the climate (Frias?Aceituno, Rodríguez?Ariza and Garcia?Sánchez 2014). However, Singtel targeted that by the year 2020, the corporation will reduce the intensity of the carbon emissions that is kWh/ TB by about 30 % and 50 % by the year 2030 by utilizing the carbon emission intensity of the year 2015 as the baseline (Info.singtel.com 2017).
Conclusion:
Therefore, it can be concluded that an individual might invest in the firm Singtel for obtaining better or higher expected return. The reason behind this is that the specified corporation has higher assets and higher owners’ equity in the year 2016 in comparison to the year 2015. In addition to these, the earned amount of profit also increased with the passage of time and along with it the earning per share of the firm also raised from the year 2015 to 2016. As a result, it can be said that the financial or economic condition of the specified organization Singtel is stable and is also improving in the year 2016.
References:
Ball, A., Grubnic, S. and Birchall, J., 2014. 11 Sustainability accounting and accountability in the public sector. Sustainability accounting and accountability, p.176.
Bebbington, J., Unerman, J. and O’Dwyer, B., 2014. Sustainability accounting and accountability. Routledge.
Buhr, N., Gray, R. and Milne, M.J., 2014. Histories, rationales, voluntary standards and future prospects for sustainability reporting. Sustainability accounting and accountability, pp.51-71.
Cho, C.H., Laine, M., Roberts, R.W. and Rodrigue, M., 2015. Organized hypocrisy, organizational façades, and sustainability reporting. Accounting, Organizations and Society, 40, pp.78-94.
Frias?Aceituno, J.V., Rodríguez?Ariza, L. and Garcia?Sánchez, I.M., 2014. Explanatory factors of integrated sustainability and financial reporting. Business strategy and the environment, 23(1), pp.56-72.
Hahn, R. and Kühnen, M., 2013. Determinants of sustainability reporting: a review of results, trends, theory, and opportunities in an expanding field of research. Journal of Cleaner Production, 59, pp.5-21.
Higgins, C. and Larrinaga, C., 2014. 16 Sustainability reporting. Sustainability accounting and accountability, p.273.
Info.singtel.com. 2017. Singtel Annual Report 2015. [online] Available at: https://info.singtel.com/annualreport/2015/overview/our-vision-and-mission.php [Accessed 10 Mar. 2017].
Ioannou, I. and Serafeim, G., 2016. The consequences of mandatory corporate sustainability reporting: evidence from four countries.
Junior, R.M., Best, P.J. and Cotter, J., 2014. Sustainability reporting and assurance: a historical analysis on a world-wide phenomenon. Journal of Business Ethics, 120(1), pp.1-11.
Lynch, M.F., Lynch, N. and Casten, D., 2014. The expanding use of sustainability reporting. The CPA Journal.
Maas, K., Schaltegger, S. and Crutzen, N., 2016. Integrating corporate sustainability assessment, management accounting, control, and reporting. Journal of Cleaner Production, 136, pp.237-248.
Martínez?Ferrero, J., Garcia?Sanchez, I.M. and Cuadrado?Ballesteros, B., 2015. Effect of financial reporting quality on sustainability information disclosure. Corporate Social Responsibility and Environmental Management, 22(1), pp.45-64.
Pérez?López, D., Moreno?Romero, A. and Barkemeyer, R., 2015. Exploring the relationship between sustainability reporting and sustainability management practices. Business Strategy and the Environment, 24(8), pp.720-734.
Rinaldi, L., Unerman, J. and Tilt, C., 2014. The role of stakeholder engagement and dialogue within the sustainability accounting and reporting process. Sustainability accounting and accountability, pp.86-107.
Unerman, J. and Zappettini, F., 2014. Incorporating materiality considerations into analyses of absence from sustainability reporting. Social and Environmental Accountability Journal, 34(3), pp.172-186.
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