Greater Kingston Food Processors Limited (GKFP) is a large Jamaican manufacturer of gourmet food products. It imports raw materials for its products from a number of countries in the OECS, and all its manufacturing operations are based in Jamaica. It has entered into “Fair Trade‟ arrangements with suppliers of key commodities in some of these countries. These arrangements contain a commitment by the company to continue to continue purchasing goods from fair trade compliant suppliers at fair prices that will enable the suppliers to make a reasonable return on their investments and treat their own employees in a fair manner. Since the COVID -19 pandemic, the company has been suffering from the effects of a severe economic recession, although demand for its food products has not fallen as much as sales demand for non-essential consumer goods. The CEO of the company has been speaking to some of the executive directors about changes that he wants to see introduced. He thinks that the economic downturn will make all companies focus on profitability and that concerns about corporate social responsibility (CSR) will lessen. He has always held the view that CSR provided some good public relations benefits but that it has no significant impact at all on the financial performance of companies or their share price. He believes that, when companies are making employees redundant, their stated concerns for CSR issues can be seen as “the pretence that they really are.” In response to a comment from the director of operations about the value of sustainability reporting, the CEO replied that this type of reporting was unnecessary and without meaningful benefit. (a) Critically discuss the extent to which you believe that the views of the CEO about CSR and sustainability reporting are controversial, valid or invalid in the light of your knowledge of CSR issues on the overall health of companies and the role of “triple bottom line reporting “ for all stakeholders in modern sustainable financial management. In your discussion, you will provide alternative arguments/ perspectives to the views expressed by the CEO of GKFP Limited.
Greater Kingston Food Processors Limited (GKFP) is a large Jamaican manufacturer of gourmet food products. It imports raw materials for its products from a number of countries in the OECS, and all its manufacturing operations are based in Jamaica. It has entered into “Fair Trade‟ arrangements with suppliers of key commodities in some of these countries. These arrangements contain a commitment by the company to continue to continue purchasing goods from fair trade compliant suppliers at fair prices that will enable the suppliers to make a reasonable return on their investments and treat their own employees in a fair manner.
Since the COVID -19 pandemic, the company has been suffering from the effects of a severe economic recession, although demand for its food products has not fallen as much as sales demand for non-essential consumer goods. The CEO of the company has been speaking to some of the executive directors about changes that he wants to see introduced. He thinks that the economic downturn will make all companies focus on profitability and that concerns about corporate social responsibility (CSR) will lessen.
He has always held the view that CSR provided some good public relations benefits but that it has no significant impact at all on the financial performance of companies or their share price. He believes that, when companies are making employees redundant, their stated concerns for CSR issues can be seen as “the pretence that they really are.” In response to a comment from the director of operations about the value of sustainability reporting, the CEO replied that this type of reporting was unnecessary and without meaningful benefit.
(a) Critically discuss the extent to which you believe that the views of the CEO about CSR and sustainability reporting are controversial, valid or invalid in the light of your knowledge of CSR issues on the overall health of companies and the role of “triple bottom line reporting “ for all stakeholders in modern sustainable financial management. In your discussion, you will provide alternative arguments/ perspectives to the views expressed by the CEO of GKFP Limited.
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