Question

You are the chief financial officer of Superior Paint Company, a company that manufactures paint and paint products in a large township. Chemicals used in the production process are disposed off in compliance with environmental regulations but some of the components of the products such as solvents, monomers and softening agents still present serious ecological risks. The company provides regional employment. The chief executive officer has asked you to prepare a report on whether the company should engage in social and environmental reporting.

REQUIRED:

Write a report that covers the following:

1. Explain what social and environmental reporting is, why it is important, why it is different from traditional financial reporting and how the information is disseminated to the various stakeholders;
2. Identify and explain the potential costs and benefits for the company to produce a social and environmental report; and
3. Recommend to the chief executive officer whether Superior Paint Company should engage in social and environmental reporting and provide two supporting reasons with reference to the GRI Framework.

Answer 1

Environmental reporting plays a very important role for every business to give explanation to the general public and to the government about the practices that company follow in order to save the environment. Social & Environmental reporting is the reporting in hich company explains what company has done for the environment, how company managed to maintain the international standards of doing environmental friendly busness and what actions did company taken to preserve the natural resources and the envieonment. This report also helps in disclosing the week points of the company regarding the duty of the company to environment and what implications caused, if these are not corrected.

In traditional period, the focus is only given to the growth of the business and earning more and more profit, the companies uses the natural resources and dispose off the chemical substabnces into the environment freely. The only focus is to earn money by making more products. But today the scenerios has changed, now it is necceasry and legally required to the companies to take care of the environment also. This reporting also helps in providing the message to the diferent stakeholders such as shareholders, emplyoees , vendors etc. to udge the companies performance and fulfillment of the responsibilities towards society.

This report create the early alarms signals of the potential losses and gains. I company doesnot take care of the environment and continiuosly harm the environment through its operations, then goverment of the company and environmental societies can push a very heavy penalty on the company and even do protest against it. This creates a very negative image of the company among the public and even results in closure of the business. But in case if company regulary engaged in environmental activies then this report helps in creating a very positive image of the company and even helps in increasing their sales and revenue.

from the above discussion, it is concluded that Superior paint company should engage in social and environemntal reporting since company already follow all the environmental norms and even dispose off their chemical waste by following the environmental guidelines. This report helps the company to create a positive image among the society. The company should follow the Sustainability reporting guidelines and the Indicator protocols exist guidelines specify by the GRI while making the Environmental report. These guidelines helps company to prepare theoir report in effective and efficient manner.