Question

Shaan Goods LLC is a leading manufacturing and trading company. They have a diverse business of Polyester, Chemicals and Life Sciences. The company’s diversified business & product portfolio caters the needs of every industry in the country. Shaan Goods LLC has a strong reputation for excellent quality & customer service. They have laid solid foundation for future growth, with major expansion projects and investments across its diversified portfolio in all of their products. The annual results for Shaan Goods LLC is also encouraging. They are able to deliver resilient performance in year 2018-19. The Company’s net turnover increased by 19% to OMR 82 Million. Net turnover of more than OMR 40 Million is a new milestone for the company and reflects its status as the partner of choice for its valued customers.

The Company has taken all necessary steps to ensure good governance. The management of the company are pleased to follow the code of governance. The financial statements prepared by the management of the company present fairly its state of affairs, the results of its operations, cash flows and changes in equity. Appropriate accounting policies have been consistently applied in preparation of financial statements and accounting estimates are based on reasonable and prudent judgment. The system of internal control is sound in design and has been effectively implemented and monitored. As per International Financial Reporting Standards, best practices have been followed in preparation of financial statements and any deviation from these has been adequately disclosed.

Shaan Goods LLC also wanted to play an important part as a responsible corporate citizen. The company recognizes that CSR initiatives in the communities where it operates creates positive impact for the people and improves their lives. As a part of its commitment, the company support the initiatives by providing vocational training and higher education to communities. Considering the growing pressures on environment, the company continues to participate in tree plantation drives and utilizes biodegradable envelopes for the mailing of the official documents. The company has started a campaign to provide safe clean water in the rural areas, more than 100

reverse osmosis plants have been fixed in the last 5 years.

a. During the current pandemic COVID 19, economies are under severe financial stress. Economies have limited resources and unable to provide the basic necessities to their people. In your opinion, how Shaan Goods LLC, with a baggage of huge net worth, can be a good example of corporate social responsibility? Relate their CSR activities to the current scenario created due to COVID 19.

b. Establishing and implementing good governance practices is the most useful activity an

organization can do to create a higher functioning of management, while building the right

foundation for achieving an organization’s vision and mission. Based on your understanding,

evaluate good governance practices followed by Shaan Goods LLC

Answer 1

a. Shaan Goods LLC could be a genuine case of CSR as its business has developed in spite of it bringing about enormous use on CSR exercises. This could demonstrate for instance for different organizations which have ventured away from CSR in view of high consumption, rather they can see that by embraced CSR, one can even develop business as the organization spends on giving abilities to the nearby network which benefits the organization by method of profoundly gifted employable individuals who remain near their processing plants. Due to Covid-19, there is extreme weight on the economy and the legislature to care for and see that individuals are not jobless and get all the social advantages. This organization sets a genuine case of taking care of its kin and making work and venture openings under such conditions with the goal that the total onus isn't completely on the administration. This makes space for the organization to get charge refunds once the administration sees the exertion it has placed in during such monetary emergency.

b. Shaan Goods LLC has followed great budgetary revealing, in this manner there is no fudging of reports and exercises so as to make good on less assessments, rather it spends on CSR with the goal that it benefits them locally and encourages them get refunds. Also significant changes happen on the inward front, which the organization guaranteed that it followes governs carefully. Regardless of whether there are any deviations, the organization has guaranteed that those are tended to in auspicious way to address the worries.

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