Executive summary
Sustainability is a word used in many fields such as environmental studies, political science, business, and literature just to mention a few. In business, sustainability means the ability to maintain the triple bottom line, which involves three aspects including, the environment, social welfare, and profits. The importance of sustainability in a business is that the business conserves the environment, maintains good human health, and is able to remain in operation while making profit (Galea, 2004).
All businesses have people or other organizational bodies, which are either directly or indirectly involved with the business’s operations. Those are referred to as the stakeholders of the business. Businesses should always engage their stakeholders especially when making changes or discussing the sustainability of the business. By doing so, a mass of ideas can be created and hence, the best ideas chosen. This also ensures that a particular part of the business is not neglected.
As the name suggests, integrated reporting involves businesses making a summary of their undertakings, and the capacity to which they have performed. The reporting should be in an orderly manner in such a way that every step can be well followed. Integrated reporting is important in that it provides a reference through which a business can strive to achieve a performance better than for the previous period.
Woolworths limited is geared towards sustainability reporting as well as integrated reporting. As such, a sustainability report should be incorporated in the integrated report of the company. These are factors, which ensure that a business remains not only in operation but also in good and lawful operation.
Sustainability and its importance
In general, sustainability refers to the ability of something to endure and be able to remain in operation. Business sustainability involves and encompasses the environment, social wellbeing particularly that of the employees and clients, as well as business operations. On the issue of the environment, business sustainability involves business operations, which are geared towards ensuring a healthy environment (Werbach, 2009). This is to mean that, pollution to the environment is far much kept on the low. This involves ensuring that the wastes from the business operations are treated before being disposed to the environment. Social wellbeing on the other hand, largely constitutes the health of workers and that of business clients. A sustainable business should be able to provide a situation in which the social welfare of human beings associated with the business in any way, is upheld. This includes providing the appropriate number of working hours to ensure that workers are not overworked, providing preventive measures to possible risks, and ensuring a good relationship between employers, employees, and the customers (Eccles & Krzus, 2010). It also ensures that the services and products offered to customers have met the health standards, especially for the food business ventures. Finally yet most importantly, the operations of the business should be in accordance to the laid requirements while ensuring that profit is achieved. The general importance as it can be deduced from the aforementioned points is that the environment is preserved while promoting human health and achieving a good business reputation, which leads to increased sales hence higher profit (Galea, 2004).
Corporate stakeholders
“A corporate stakeholder is any person or body that can be affected, or can affect the operations of a business” (Galea, 2004). A typical business has many corporate stakeholders depending on the size of the business. Corporate stakeholders include customers to the business, employees, suppliers, trade unions, the government, investors, and the community among others (Galea, 2004). Woolworths as a business has the above-mentioned stakeholders. In matters concerning sustainability, Woolworths limited would have engaged most of the above-mentioned corporate stakeholders such as the customers, employees, suppliers and the government.
Customers
Customers are very essential to any business as they ensure that the business remains in operation. On the issue of sustainability, Woolworth limited might have engaged customers on the issue of sustainability by interviewing them on how they thought their relationship with the business is, and the changes they would advocate for the business to undertake (Galea, 2004). This way, Woolworth limited would have had the opportunity to know the issues of the business that affected their customers negatively, as well as those, which affected them positively. The business would have then taken the initiative of correcting their operations to ensure that the welfare of customers was upheld.
Employees
Without employees in a business, especially the large businesses, its operations can never be performed. This makes employees important to business enterprises. Woolworth limited might have engaged its employees in matters of sustainability by including them in making of decisions (Werbach, 2009). This way, the employees might have given their views on the business sustainability, especially on the issues that affect the employees, such as working conditions. Additionally, the business might have chosen a few representatives of the employees to represent the rest in decision-making.
Suppliers
Suppliers are the people or organizations, which undertake the task of availing goods to vendors and other businesses (Werbach, 2009). Woolworth limited has its own suppliers who avail the goods to the Woolworth business. Therefore, they make the operations of the business alive. Woolworth limited might have engaged its suppliers on the issue of sustainability through negotiations. This is whereby, the business presents its needs and the suppliers also present their needs, then the two parties negotiate on how to combine the needs of both sides to ensure a green supply chain.
The government
There are some requirements that have been set by the law for all business operations with regards to environmental and social welfare. Woolworth limited might have engaged the government in the matter of sustainability by reviewing acts that have been developed to control the operations of businesses, and ensuring that the business operations are in line with those acts.
Importance of the public and private interest theories in implementing sustainability and sustainability reporting
The public interest theory suggests that regulation is a key aspect to businesses. It supports the argument that the government can control the operations of a business whenever the business in unable to do so. This is done with regards to the requirements of the public to the business. On the other hand, the private interest theory acknowledges that the individuals who form an organization, or are involved in any operations are the controllers of the regulatory process. The main drivers that led Woolworth limited to use the public and the private interest theories include the following.
Imperfect competition
The public interest theory suggests that antimonopoly legislation helps in ensuring that market operations are maintained, while competition in business is limited. This helps ensure that the operations of businesses do not deviate from the laid regulations of safe operations. This drove Woolworth limited to use the public interest theory to ensure that its business complied with social and environmental laws while being able to maintain its operations for profit (Winch, 1989).
Undesirable market results
The public interest theory aims at ensuring that there are no undesirable market results, which can eventually lead to some businesses being thrown out of operations. Since Woolworth limited business operated in a competitive economy, it was essential for the business to be aware of its marginal productivity contribution to the economy. This was only possible through the public interest theory. The business was able to identify the factors that it needed to incorporate in its operations to ensure that it contributed to the productivity of the economy (Winch, 1989).
Business interest
Every business has a hierarchy of the governing and leading body. These could include the managers who are at the top most position (Jordana, 2004). The private theory suggests that the individuals who undertake and spearhead the operations of a business are the main regulators of the business. This might have been the driving force of Woolworth limited to using the private interest theory. The business has the corporate body, which is the major initiator or starter of the business operations. Such a body had their interests in the business operation, which they chose. In many cases, the major interest of many of the starters of business operations is to achieve profits from the business operation (Jordana, 2004). Therefore, by using the private interest theory, Woolworth was able to realize strategies of importance in achieving the interest of their business.
Incorporation of both the private and public theories ensured that sustainability of the Woolworth business was achieved since matters regarding the business operations, the environment and social welfare were all catered for, while ensuring that the interests of the business were being achieved (Jordana, 2004). The approach of both the private and the public interest theories can be used in our business to ensure sustainability.
Integrated reporting and its importance
Integrated reporting refers to a systematic, inclusive representation of any business’s performance including the financial results and operations results. Integrated reporting provides a basis for comparison of data between different periods in matters finance, social welfare and business operation efficiencies. It is very important that businesses have a system of integrated reporting. This is because integrated reporting can easily motivate action (Jordana, 2004). Through integrated reports, workers can be able to increase their performance in order to ensure that the next integrated report has better results than the previous report. Secondly, integrated reporting provides clear metrics. This is because, only the much that has been used, and the much that has been gained is displayed. This provides a basis on how much is expected to be spent and done in order to attain a certain level. This is a very good strategy of achieving sustainability. Finally, integrated reporting ensures quality. That is, quality in terms of services, goods and relations. A business will strive to ensure that the contents of an integrated report are of high standards (Eccles & Krzus, 2010). This will hence call for quality performance. All these factors lead to a sustainable business, a reason that explains why sustainability goes hand in hand with integrated reporting.
Current position of Woolworths regarding integrated reporting
Woolworth limited is on the lead in terms of retail integrated reporting. Woolworth has not yet been able to integrate fully their financial reports to the sustainability reports. This is the major challenge facing the business bearing in mind that the company is already half way in their sustainability strategy. Since the company is leading its competitors in reporting, it shows that they easily be able fix the above problem within no time. This serves as a challenge to us on the issue of sustainability. It would be wise if we emerged fully energetic to ensure that we instil sustainability and integrated reporting in our business.
Conclusion
From the above discussion, it can be concluded that integrated reporting should be practiced on a large scale on larger companies such as Woolworths limited and the needs of their investors. This is because of the great significance it has on the company as well as its stakeholders. Nevertheless, this is not yet enough because it should incorporate other stakeholders such as the customers and suppliers. This is because the operations of any business do not only affect the business and its investors, but also other corporate contributors such as the customers. While trying to view the way forward in ensuring sustainability and integrated reporting, we should start from the bottom line. This means that the ideas of different stakeholders should be screened and put into consideration. This helps in ensuring that all the areas that a business is concerned with are attended to and all the parties that significantly influence the business are incorporated and considered (Eccles & Krzus, 2010). After all that, stable and green economy shall be created.
Reference List
Eccles, G., & Krzus M 2010, One report: Integrated reporting for a sustainable strategy, John Wiley & Sons, Hoboken.
Galea, C 2004, Teaching business sustainability, Greenleaf, Sheffield.
Jordana, J 2004, The politics of regulation: Institutions and regulatory reforms for the age of governance, Edward Elgar Pub, Northampton.
Werbach, A 2009, Strategy for sustainability: A business manifesto, Harvard Business Press, Boston Mass.
Winch, M 1989, Collective bargaining and the public interest: A welfare economics assessment, McGill-Queen’s University Press, Kingston.