Question

As CEO of the company, your first order of business is outlining a strategic plan for the next 5-years. it. The approach that you need to take, to keep shareholders happy, is one that maximizes profitability. However, you firmly believe that your company should be environmentally friendly as well and promote a positive social impact. This other approach will create additional costs that put at risk the profitability required by the shareholders. How would you/could you proactively manage this dilemma?

Answer 1

The main motive behind conducing any business is to create wealth for the stakeholders. To create such wealth and ensure business sustainability, the company need to create the brand image among customers not just for the quality of product but also emotionally attached the customers with you brand. The customer will be more loyal and long lasting if attached emotionally.

Therefore following ways, you can use to work environmental friendly and preserves the natural resources –

• Follow the process of manufacturing and make use of products that reduces your dependency on natural resources, e.g. Solar system for saving energy
• Make use of the recycled products
• A wide view in your day to day operation to save wastage, e.g., wastage of papers, etc.

This way, this will positively affect the environment and will save your money in terms of wastage and use of recycled products.

This will also be going to attract the new customers as you will gain the competitive advantage over the other business and customers would be willing to try the products of the company who thinks from society point of view relying on the quality of your product which they may predict already good.

Further, when you will be not much dependent on natural resources, there will be less impact of climate and weather conditions on your business and hence will improve productivity.

Further, the corporate these days are taking part in Corporate Social responsibility and recognizing this fact that impression and goodwill will be created among the customers via these activities which will of course increase the profitability for the business and will overcome the cost incurred in the process.