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Focus Limited dimensions in Business Ethics/CSR
Venkateswara Rao Potini (2016948)
University Canada West
BUSI 601: Business Environment, Ethics & Strategy
March 20, 2021
Table of Contents
1. Cover Page…………………………………………………………………………….1
2. Table of Contents………………………………………………………………………2
4. Focus Limited Company Profile……………………………………………………….4
5. Ethical Issues/Challenges…………………………………………………..…………5
6. Stakeholders’ Interests…………………………………………..……………………8
7. Corporate Social Responsibility Strategy……………………………………….…..10
My company is Focus Limited located in the province of Ontario Canada. The company is dealing with home furnished products. As a company we value business ethics and corporate social responsibility. Business ethics will give Focus Limited the codes of values and principles that govern the actions of folks of being what is correct versus what is incorrect (Heidelberg, 2015). Business ethics is a form of applied or professional ethics that scrutinizes ethical ideologies, and moral or ethical difficulties that result from a business environment.
These are the rules, standards, codes or principles that provide guidance for morally appropriate behavior in managerial decisions regarding to the operations of the enterprise, and entity relationship with the society. Moreover, it is the behavior that an enterprise follows in its daily dealings with its stakeholders such as employees, customers, suppliers, immediate community and society in general (Manakis,2018). The progress of business organization depends on its comprehensive ethical code of conduct set to monitor both administration and personnel in its day-to-day activities.
Unethical behavior or incapability to reveal corporate social responsibility can damage a firm’s reputation and make it less appealing to the key stakeholders. Business ethics and CSR are often used interchangeably although each a different meaning. Corporate social responsibility (CSR) is an integrative management concept, which creates accountable behavior within an entity, its aims, values and proficiencies, and the welfares of stakeholders (Caroll, 2015). Entities that reliably demonstrate ethical behavior and social responsibility get good results. Corporate social responsibility aids an entity to be socially accountable to itself, its stakeholders and the public. By practicing corporate citizenship entities are made aware of the kind of effect they are having on all aspects of society, including economic, social and environmental. Companies must incorporate business ethics and corporate social responsibility in their corporate strategy for them to be socially responsible effectively.
Focus Limited Company Profile:
Focus Limited is a furnishing home products manufacturing company in Ontario province in Canada. It was established in 23 May 2016.Our Mission statement is to offer a wide range of well designed, functional home furnishing products at low revolutionary prices that numerous people as possible can afford, while leading the way for socially responsible businesses. Moreover, our Vision statement is to create a better everyday life for the many People (Kantabutra & Avery, 2010). Focus limited core values include: humbleness and will power, leadership by example, daring to be different, togetherness and enthusiasm, cost consciousness and accept and delegate responsibility.
The Company has evolved significantly from two branches to a reputed home furnishing brands in the world. Focus Limited currently operates more than fifty stores across the world with prospects of growth in the future. In Ontario province alone we have ten branches and another twenty spread across Canada. In 2020, the company was awarded the Red Dot Design Award for being the most valuable brand in Canada. This award is one of worlds’ largest. At Focus Limited we are not just making things, we are using design to make things better. We work with what we call democratic design, where we make sure our products have great function, are beautifully designed and made to stand everyday life, while being sustainable all made through low prices.
We provide a wide range of home furnished products that give our esteemed customers value for their money and satisfy their needs and wants. The awards and recognition that we have gotten shows us that we are on the right track. We are enthusiastic that our fellow market partners appreciate our effort to make outstanding home furnished product designs with a lot of value (Quarshie & Leuschner, 2016). Social responsibility is our treasure as we serve our clientele and other key stakeholders.CSR has been incorporated in our overall corporate strategy since we know the benefits that we get from being ethical and socially responsible.
Focus Limited has numerous ethical issues such as age discrimination, violation of the right to unionize, and other serious workers’ rights in their supply chain. The entity’s approach to tax, lobbying, and animal rights, habitats and resources and the environment in general are other key areas of concern. Age discrimination accusations. The company has been facing a myriad of accusations on age partiality. We promote, demote and offer pay based on the age of our employees since we believe that the older you are, the more experienced you can be (Griseri & Seppala, 2010). This has resulted in a number of court cases. For instance, in Ontario law court we have been sued by one of our staff on the basis of age discrimination pertaining our refusal to grant her a pay rise.
Undermining of the right of the employees to be unionized. Our Company does not advocate for employees to be unionized. This is because if the staff join unions the leaders of the unions will fight for their rights to be well represented. The company will have to pay the staff as per the labor laws. The workers got an impression that their wages and conditions would be significantly worse if they could vote to form a union (Manakis, 2018). As a company we informed the workers that their job security will be worse if they unionized.
Criticism on tax issues from the government. In 2020, our company was accused of avoiding up to $505 million in corporate taxes from 2018 to 2019, as per the report from the revenue authority tabled in parliament. This report revealed that Focus Limited had devised itself how to avoid taxes using overseas tax havens. Our entity got a worst Ethical Consumer’s rating for use of tax avoidance schemes in August 2019, it had numerous company holdings in areas seen as tax havens.
Environmental degradation. Focus Limited uses a lot of timber as raw material in the production process. This has resulted in the deforestation in most of our tree growing fields and our supplier’s tree farms. The cutting of a lot of trees to get timber causes deforestation which will result in deserts if more new trees are not planted to replace the old ones. Desertification will be inevitable since the sun rays hit the ground surface directly leading to desertification. Loss of natural forests results to damage of biodiversity and creeps up the habitation of numerous species of wildlife (Heidelberg, 2015). It also hastens climate change as forests perform a vivacious role in the carbon cycle. Flourishing forests seizure carbon dioxide from the atmosphere and stock it, releasing oxygen in exchange, whereas deforestation causes the release of carbon if the forest is burnt and less carbon capture in future if it is replaced with agricultural crops. Our company will ensure as much as possible to go green by initiating reforestation programs. We have also an EMS team to execute and oversee ecofriendly practices.
Sexual harassment is another ethical challenge facing Focus Limited. As a company we have to address this issue by implementing employees training. This can be done by ensuring that everybody who works in the entity is enlightened on the rules and ensure that they are circulated within the organization to make sure that every staff has a look at them (Freidman & Tribunella, 2012). Enforcement of a zero tolerance to sexual harassment policy will be key to eradicating this matter. Managers and supervisors in the organization will lead by example. As a company we endeavor to provide mechanisms for reporting cases of sexual harassment and consistently observe inappropriate behavior. Additionally, there should never be victimization the part of those staff who report these cases. Preventive steps also can be taken by the entity to make it mandatory that during company event should include alcoholic drinks which are catalysts for sexual harassment. Social media ethical issues (Griseri & Seppala,2010). There is ethical dilemma in Focus Limited with regard to staff handling of social media. When it comes to staff politeness on social media, the bottom line for most entities is that the staff can be admissibly ablaze if the activity is considered treacherous or monetarily detrimental to the business.
Health and safety ethical isues.The health and safety of employees and customer is very critical to our entity Focus Limited. The company has instituted measures to ensure that the staff and our esteemed customers are safe while at our premises. We have insurance covers for any injuries that the staff will encounter on the course of working in the company premises. Our employees have been educated on safety protocols and informed them that help is essential (Carroll, 2015). Moreover, we frequently carry out inspections in the work areas for any risks. Also we encourage healthy living and identify and reward good effort.
Focus Limited has an ethics platform that requires teaching of personnel and guidelines and codes that monitor the ethical demeanor in the organization. The foremost code of behavior is the contractors’ code of conduct. Since much of the Focus Limited businesses require products purchasing, materials and services (Quarshire & Leuschner, 2016). The code violators are dropped as contractors. One of the necessities for contractors under Focus Limited is non-use of child labor or forced labor. Suppliers are required to agree on annually internal audit compliance. Although Focus Limited is popular among furniture enthusiasts, it has faced a number of ethical lapses.
Focus Limited has always toiled to have their goods reach the quality expected by the quality assurance bodies and the most stands out quality is their simplicity which makes them so likeable to the customers. In crafting of the buildings, Focus has made sure the buildings for their stores are constructed as per the required procedures of building authorities and most significantly Focus has a worthy record of tax amenability; it pays the compulsory tax without flop or circumvention.
There are a number of stakeholders whose interests Focus Limited must safeguard. They include the following: shareholders, employees, suppliers, communities, banks, and government and regulators.
Shareholders’ interests. Focus Limited must address its business model and corporate governance including the role of the board in risk management, in sustainability reporting and in evaluating CSR performance. Owners of the company have interest in the entity performing well in that they want to get profits and get extraordinary dividends (Caroll, 2015). Shareholders of Focus Limited can affect its operations by changing management or investing or withdrawing equity into the entity.
Employee’s interests consist of how much and how often they will be paid by the company, job security, job satisfaction and fulfillment, profit sharing and stock options, improved working conditions. Banks have interest in the well-being of the entity so that the entity can be able to pay back their loan obligations in full amount and on a timely manner (Friedman & Tribunella, 2012). Financial institutions can affect how a business runs by allowing or refusing to give loan requests, altering interest rates on loans and loan repayment durations.
Government and regulators have interest in an organization so that the business can satisfy its interests of paying corporation tax, create employment opportunities and riches to the general public and provision of products and services to the population(Rangan, Chase & Karim,2012). The Canadian authorities can affect how Focus Limited is operating by increasing or reducing corporation tax, introducing or repealing laws that impact on entities and provision of incentives such as tax holidays (Manakis, 2018). Government also can influence management of business entities more so those that it has some stake.
Suppliers have interests in the success of a business organization like Focus Limited so that they can frequent orders from the entity and other businesses and hasty payment. They will impact Focus Limited processes by increasing or reducing prices of goods, credit terms alterations, delivery schedules changing and increasing or reducing the quality of goods or materials (Quarshire & Leuschner, 2016). Local communities are interested in the well-being of Focus Limited because the community wants the entity to create employment opportunities to the population in the community, better and safe environment to dwell in and improved transport and communication networks.
The community can affect the entity’s operations by holding protests and petitioning if unhappy with the enterprise’s behavior. Customers’ interests in Focus Limited include: quality products and services, low prices for goods and services offered and the value for their money (Heidelberg, 2015). Consumers impact the entity by deciding whether or not to purchase the good or use the service and they will affect Focus Limited reputation by word of mouth. Managers have their own interests in getting promotions at Focus Limited, attainment of bonuses and job security.
Conflicting interests of stakeholders. Even though each and every stakeholder has interests, some conflict. Owners generally seek high profits and so may be reluctant to see the business pay high wages to staff. A business decision to move production overseas may reduce staff costs (Griseri & Seppala, 2010). It will therefore benefit owners but work against the interests of existing staff who will lose their jobs. Customers also suffer if they receive a poorer service. Managers may want to pay for goods later to improve cash flow whereas the suppliers will want their payment as soon as possible (Rangan, Chase & Karim, 2012). Managers want the highest profit possible on sales whereas customers want low prices for high quality goods
Corporate Social Responsibility Strategy:
These are the strategies that Focus Limited has executed as part of corporate governance that are intended to make sure that the entity’s processes are ethical and advantageous to the society. Corporate social responsibility initiatives can be grouped as follows: Environmental responsibility, human rights responsibility, philanthropic responsibility and economic responsibility.
Economic responsibility initiatives entail advancement of the entity’s business operations whereas participating in sustainable practices. For instance, making use of a new manufacturing process to reduce wastages in the business.Philantropic responsibility that consists of financing educational programs, health care efforts, donations to disasters and aiding of community projects (Caroll, 2015). Human rights responsibility efforts entail provision of fair labor practices such as equal pay for the same toil, impartial trade norms and no child labor.
Focus Limited has incorporated its social responsibility with the corporate strategy so that we can be corporate citizenship leaders in our industry. As a company we are socially responsible to the various stakeholders as follows: Customers, we offer them better quality home furnished products that give value to their money, affordable prices for our products that they can pay without complaining and we give them better customer service so that we can keep lingering in their minds for future purchases they may need (Friedman & Tribunella, 2012). Our employees we have provided them with good working conditions, impartial salaries and wages, no sexual harassment as before, no discrimination on age as before and there exist schemes for employee’s motivation and satisfaction.
We value our shareholders, profits for Focus Limited have been maximized and dividends increased by making high sales margins so that the shareholders’ interests can be safeguarded fully. In terms of our suppliers, they have been given constant orders and their payments are processed promptly. On their side also they are offering us better quality goods for our production process. There is an existence of management promotion and job security plan to ensure that we maintain our management team within Focus Limited (Manakis, 2018). Managers get bonuses whenever they perform exemplarily well to guarantee bonuses so that they can be motivated.
Focus Limited treasure the local communities where we operate by building a good infrastructure networks, offered employment opportunities to the community people and practiced ecofriendly activities that do not do environmental degradation. To the authorities in Ontario Province we give our taxes, follow any change in policy and we also offer jobs as per their legal requirements (Caroll, 2015). For example, we have supported communities by aiding education and health efforts and sponsorship of special events
CSR is increasingly becoming a global practice, with businesses based in different countries tending to pursue approaches that reflect their particular mix of political, regulatory and financial systems, culture, history and resources. The notion of CSR is increasingly important in today’s global business climate, as companies compete and pursue economic growth through internationalization.
Corporate social responsibility brings numerous benefits to Focus Limited, they include: strong brand image, appreciation and status, improved buyer loyalty and sales, operative cost savings, investors become willing to support an entity that embraces corporate social responsibility, helps in the retention of crucial and talented staff, fosters strong relationships with regulatory bodies and the entity(Heidelberg,2015).Corporate social responsibility must be incorporated with an entity’s competitive strategy and undertakings. It cannot be viewed as a separate effort at humanity, for example, to which the Focus Limited can point as settling its accountability to society.
The clients and the public can be made attentive of corporate social responsibility through sensitization programs, promotions, charitable programs and endorsing environmental sustenance. Branding products for consumers, having reward systems for purchases and creating customers relations. The firm must charge them reasonable prices for products and services they offer them, provide true facts about advertisements, enhanced quality of goods, and offer safe goods and services to the consumers (Bair & Palpacuer, 2015). The communities can also be enlightened through campaigns and taking part in community development projects. During this forums Focus Limited should inform the community on the several programs that are on the process of being implemented to ensure that they are socially responsible to the community.
Entities like Focus Limited can exhibit corporate social responsibility in many ways. The entity can capitalize in environmental and societal ingenuities to reveal corporate social responsibility. Focus Limited always help the society by establishing events or contributing funds to inventiveness that encourage the effect responsiveness. Through such involvement, the incorporation of values and operations will be operative as the status of the entity will continue to be robust (Quarshire, Salmi & Leuschner, 2016). This in reoccurrence will bring a lot of paybacks to the business such as extraordinary sales and overall enterprise growth. Therefore it is prudent for firms like Focus Limited to be ecofriendly.
Customers are progressively preferring undertaking business with companies that support happenings that they value. Hence Focus Limited keeps an eye on corporate social responsibility. Customers would pay higher prices for goods that are sold by socially responsible companies as they feel more associated with such companies. This in turn is good for the corporations as the integration of values and culture enhances the value chain management of the companies (Hsueh, 2015). Entities can also exhibit corporate social responsibility by contributions in terms of services, money, or products. This habitually targets charities and community organizations. The donations of goods and services can lead to buyer recommendations which will be beneficial to the business as the goods and services will sell extra hence an essential link to operational value chain management.
Enterprises prove corporate social responsibility by appealing talented employees. Personnel looking for business management will favor businesses with core values that match their personal values during application of jobs (Nyborg & Zhang, 2013). Businesses make high earnings from talented employees. Corporate social responsibility is key in employee retention and satisfaction. This in turn leads to effective value chain management of the company as staff form a key aspect in operations to the client level. These personnel will help in improving customer service.
Companies taking part in community relations through charity activities encourages and challenges others to join in the program. This creates an opportunity for companies to work with other companies which creates new collaborations and a new potential client base. The working together creates friendly competitions among companies involved and employees get to network and learn new methods of business engagement which leads to the companies gaining more (Crifo &Forget,2015). This networking as a demonstration of corporate social responsibility behavior leads to company gains hence evidence of effective value chain management.
Focus limited has created an overall corporate code of ethics for the company which will help us to deal with our ethical challenges effectively. This code of ethics have been developed for all departments of the company. They have not been designed on human resource and legal department alone. This ethics program was executed from the top down. This was important as an ethical program cannot be useful if all the employees are not trained on how it works and their functions in it(Griseri & Seppala, 2010).Therefore, every employee must be aware of the code of ethics and do as per the policies and procedures and the code of ethics. Focus Limited will benefit from a sound code of ethics that every staff in the organization is in tandem with it.
Focus Limited is dealing home furnished products. The company values business ethics and corporate social responsibility. Unethical behavior or incapability to be socially responsible can damage an entity’s reputation. Focus Limited has a number of ethical issues that it is struggling to handle for it to embrace corporate citizenship. The entity has made initiatives to safeguard stakeholders’ interests in order to be a leader in social responsibility after realizing we had a number of ethical challenges. The company has incorporated its corporate socially responsibility activities with its corporate strategy as a game changer to its social responsibility goal.
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