Question

How is upper management accountable to shareholders for long-term growth and profits in the context of sustainability? (400 words)

Answer 1

Accountability is a term in corporate governance which is an organization's acknowledgment of responsibility for the actions, decisions, goods, and policies it undertakes. Rising stakeholder expectations are encouraging organizations to take a broad, clear and systemic view of the impacts of their decisions. Businesses are a major actor in modern society and stakeholders expect businesses to contribute positively to the well-being of society. Stakeholders want companies to be more than providers of a commodity or a service; they want them to play a more constructive position in society.

Larger corporations, such as Toyota, are now leading sustainability reporting campaigns, as they have greater financial leverage at their disposal to meet additional sustainability reporting costs. Replicating the efforts of the largest and most resourceful businesses can be difficult for smaller companies. These bigger company efforts in sustainability reporting, which are the focus of this chapter, provide examples of the types of information that could be useful for businesses of all sizes to report on and provide details of processes that businesses of all sizes can establish in sustainability reporting.

Organizations need reliable data on carbon, electricity, toxics, waste and other sustainability to help companies understand and enhance their efficiency. While conventional business financial statements – such as balance sheets and net income statements – can help a company assess whether it is financially sustainable (an essential part of business sustainability), they alone are insufficient to measure the environmental and social progress of a business.

Efficient partnership is the secret to driving sustainability through an industry or a supply chain. Organizations can do what they can to strengthen their environmental and social effects within their own activities, but the major changes are made when businesses align their supply chains with the actions of manufacturers , distributors and all other stakeholders.Organizations will do only as much without their customers help. The green movement will stagnate if customers are reluctant to purchase or pay more for environmentally friendly or fair trade goods.