You are a senior auditor for A and B Chemicals plc, a large multinational pharmaceutical company. The company is aware that transparency is essential for successful global operations and that engagement with stakeholders is essential for a transparent reporting process. The company’s board of directors aims to develop its corporate social and environmental reporting and has asked internal audit to lead a discussion on this development. You have been asked to prepare a briefing paper to present to the discussion group in which you:
1. a. Identify the likely stakeholders of the company and explain how their need for information might differ.
b. Describe the type of information that the company’s stakeholders might require that should be included in a corporate social and environmental report.
c. Discuss the benefits to the stakeholders and the company in adopting a responsible approach to social and environmental reporting.
| Answer |
| 1) The key stakeholder of the company are : |
| a. Shareholder : They are the holder of the companies share. They have invested the money in the company so they are directly interest in companies growth and profit. They need the information of companies profit and prospective venture |
| b. Employees : They are the very valuable asset of the company. They are also interested in the companies growth as it will lead to there growth in terms of incentives and salary |
| c. Government : For government of any country , money is collected from profit making company is only the source of revenue. So they are interested in financial information of the companies. |
| d. Supplier : They are concern of the cash position of the company and profitability performance of the company. If the company is cash rich, then they will get there payment on time |
| Other important stake holder of the companies are customer, bankers, prospective investors. |
| b. Describe the type of information that the company’s stakeholders might require that should be included in a corporate social and environmental report. |
| Following types of information stakeholder's generally required : |
| 1) Stakeholder of the companies are keen to know the type of corporate social responsibility undertaken by the companies. What was the financial percentage spend for undertaking the task of social responsibility , why the specific activity was under taken |
| 2) They are also interested to know that how much was the society benefited from the CSR activity conducted by the company. It should state that how were they able to change the life of people by undertaking the activity |
| Egg : If a company decided to bear all expenses of women development institute , then company should state the number of women's benefited by it, how could it change there way of life etc. |
| 3) Company should state that what sustainable development activity was undertaken by them during the course of regular operational business. |
| 4) Company should mention in there environmental report about harmful activity conducted by them which damage the environment of its operational area and how harmful was it for the citizen of the country. Destruction of environment and detrotion of human health should be considered in environmental report |
| c. Discuss the benefits to the stakeholders and the company in adopting a responsible approach to social and environmental reporting. |
| The benefits are listed as under : |
| 1) It create a positive image of the companies brand |
| 2) Environmental development is taken care of |
| 3) Human health is also considered while adopting the concept of substantial development |
| 4) Company can avail the benefits of various subsidy given by the government for the companies adopting social and environmental resoponsilbilty |
| 5) Positive and loyal employee |
| 6) Growth of the company |
You are a senior auditor for A and B Chemicals plc, a large multinational pharmaceutical company....
You are a senior auditor for A and B Chemicals plc, a large multinational pharmaceutical company. The company is aware that transparency is essential for successful global operations and that engagement with stakeholders is essential for a transparent reporting process. The company’s board of directors aims to develop its corporate social and environmental reporting and has asked internal audit to lead a discussion on this development. You have been asked to prepare a briefing paper to present to the discussion...
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