This document analyzes corporate social responsibility (CSR) reporting by 50 companies based on nationality, industry, size, and age. The researchers used Global Reporting Initiative guidelines to evaluate CSR reports. Key findings include:
1) U.S. companies had higher quality CSR reports on average than U.K. companies, supporting the hypothesis.
2) Airline and pharmaceutical industries had the most useful CSR reports, partially confirming the hypothesis.
3) Medium-sized companies ($7,500-$50,000 million) had the highest quality CSR reports, rejecting the hypothesis that larger companies would be better.
4) Analysis of company age as a determinant of CSR usefulness was inconclusive due to the document cutting
Relationship between Corporate Social Responsibility and Earnings Management ...ijtsrd
The relationship between corporate social responsibility CSR and earnings management EM is an extensive empirical study. However, the evidence on the nature of the relationship is unclear. A commonly defined reason for divergent and contradictory results is measurement issues. The purpose of this article is to evaluate alternative operation and measurement methods applied to the CSR and EM concepts in the empirical literature on CSR EM relationships. Our systematized appraisal was conducted over the last nine years from 2008 to 2016. This study has come to different observations. First, CSR measurement methods include sustainability indexes, content analyzes and single dimensional measurements, while EM measurement methods include discretionary accruals, discretionary loan loss provisions, real earnings management, abnormal earnings management, earnings persistence and earnings smoothing. In addition to the unique drawbacks of the approach, the subjectivity of the researcher and the selection anomalies that may influence the nature of the CSR EM relationships identified in the empirical literature. Finally, possible ways of overcoming these disadvantages are recommended. Mashiur Rahman | Sarah Chowdhury ""Relationship between Corporate Social Responsibility and Earnings Management: A Systematic Review of Measurement Methods"" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-4 | Issue-2 , February 2020,
URL: https://www.ijtsrd.com/papers/ijtsrd29987.pdf
Paper Url : https://www.ijtsrd.com/management/business-ethics-and-legal-issues/29987/relationship-between-corporate-social-responsibility-and-earnings-management-a-systematic-review-of-measurement-methods/mashiur-rahman
How Can You Drive Opportunity If You Cannot Manage Risk?Lora Cecere
Report Details: The research for this report was conducted via an online survey from March 12 - May 11, 2018. Surveys were conducted among 93 respondents -- a mix of business users (manufacturers, wholesalers/distributors/co-operatives, and third-party logistics providers, n=34), vendors (software providers and consultants, n=39), and others (academics, analysts, unemployed, and others, n=20).
Objective: To understand the current and expected future state of supply chain risk management, the biggest drivers of risk, and the impact on supply chain disruptions. NOTE: supply chain risk management is defined as the proactive identification and assessment of potential risks to the supply chain, as well as the development of strategies to avoid these risks.
Highlight: Nearly two-thirds of respondents believe that their company performs better today on risk management practices than five years ago yet they had 3.5 disruptions last year on average. Managing risk requires a network approach. Today’s investments in end-to-end supply chain are by and large not effective in risk mitigation. Only 37% have visibility of extended-tier suppliers and most lack the solutions to manage global complexity.
Three Techniques to Improve Organizational Alignment-9 July 2013Lora Cecere
When organizations are aligned, things happen quicker. It takes less effort. People know what to do, and there is a greater bias for action. As a result, the organization can achieve higher levels of results and better withstand the pressures of demand and supply volatility.
Line of business leaders lack alignment. While many consultants claim that business results happen through better IT and business alignment, in this study, we find that the gaps in functional alignment within the business functions of sales, marketing, finance, and supply chain are far greater than the gaps between IT and line of business.
As shown in figure 2, within the organization, demand and supply volatility reigns. It is growing worse. This pain is felt across the line of business functions. To weather the storm, functions attempt to align, but doing this is easier said than done. It requires work and leadership.
This misalignment is not equal by business function. Of the three groups in this survey—supply chain, finance and information technology (IT)—the supply chain organization feels the alignment issue to a greater degree than the other two business functions. As shown in figure 2, it is one of their top three business pains.
So, what can an organizational leader do to improve alignment? In this study, we find that when companies do three things, and focus on doing them well, they can substantially improve organizational alignment:
• Have a Clear Definition of Supply Chain Strategy. While many companies state that they want to be “agile,” it requires definition. Companies need to design a supply chain with this goal in mind. When the organization has a carefully crafted definition of agility, it is able to improve organizational alignment. The definition of “shorter cycles” is not sufficient.
• Sales and Operations Planning. Organizations with a mature S&OP process are more aligned. In this study, 61% of supply chain respondents report having an S&OP process, but 48% of that group rate their process as effective. For a more detailed analysis of S&OP, please refer to our report Sales and Operations Planning: Current State of the Union.
• Supply Chain Center of Excellence. Organizations with a supply chain center of excellence are more aligned. The greatest impacts are between marketing and finance, as well as operations and Corporate Social Responsibility.
The study shows that there is significant opportunity for organizations to improve on all three of these critical factors. The good news for supply chain leaders is that this study provides three clear actions that can deliver improved alignment.
At one time, the physical store defined the retailer. It was the brand. Today, this has changed. Now the store is a part of a cross-channel experience. It is a combination of goods and services. The impact of the change is different by retail sector, but it is pervasive.
While changes in other industries have happened incrementally through continuous improvement and process innovation, retail has been transformed by new business models. The pace is faster and the customer demands higher.
Redefining the role of the store is critical. It requires partnerships of both retailers and manufacturers. It is for this reason that we wrote this report.
Launch of the Supply Chain Index - 11 JUNE 2013Lora Cecere
This document introduces a new Supply Chain Index that aims to determine which supply chain metrics correlate most strongly with financial market valuations, as measured by market capitalization, across different industries. It describes 18 months of research analyzing correlations between supply chain financial ratios and market cap data for various industries. Key findings include that the metrics that matter most vary significantly by industry, and that some industries like household/personal products have clear supply chain leaders while others do not. The report aims to help supply chain leaders understand which metrics have the greatest impact on improving shareholder value for their specific industry.
Supply Chain Metrics That Matter: A Focus on Brick & Mortar Retail-18 FEB 2013Lora Cecere
The bricks and mortar retailer is being squeezed. Growth is slowing and margin is under pressure. With the rise of e-commerce, the role of the store is being redefined. It is about service and the customer experience. As a result, it is time to rethink the metrics that matter and focus outside-in on the shopper experience.
In this report, we share insights on the current state of bricks and mortar retail and offer our suggestions.
Brick & mortar retailers have weathered an intense decade with the persistent rise of e-commerce. The shopper has changed and recovery from the Great Recession is ongoing, but slow. Our previous Supply Chain Metrics That Matter: A Focus on Retail report focused on the broader industry trends affecting five different divisions of retailers and the challenges of multi-channel retail. This report narrows the focus to three segments of brick & mortar retailers struggling to adapt to the new world.
A retailer is not a retailer. We believe that retailers should be compared by business model. We do not believe that one can throw all retailers together and identify the “most improved” or “best” supply chain. There are too many variables and circumstances affecting the retail landscape to make valid comparisons. In our research, we find that small and well-defined peer groups offer the best way forward for understanding both segment and industry specific trends.
The industry segments analyzed in this report are grocery, mass and specialty. Grocery retailers are involved in the sale of perishable and non-perishable food stuffs. Mass retailers are larger companies focused on providing a comprehensive retail experience to their customers. Finally, specialty retailers are dedicated to specific customers, activities and goods. The companies in this analysis represent both American and global retailers.
Our grocery peer group consists of Carrefour, Delhaize Group, Safeway and The Kroger Co. The mass retailer peer group includes Costco, Metro, Target and Walmart. The choice of specialty retailers was by far the most difficult because there are so many dedicated stores in this category. For this publication, our peer group includes Bed Bath & Beyond, Dick’s Sporting Goods, Foot Locker and Ross Stores. Additional information about all of these companies is presented in the Appendix.
Consultants' Voice on Supply Chain Excellence - 20 August 2012Lora Cecere
This report is the second report in a two-part series. The first report published in May 2012 and represents the Supply Chain Executives’ voice and perspectives on supply chain excellence. This report is a companion report reflecting the views of consulting partners working on supply chain across multiple industries. In this report, we contrast the two views while sharing insights from the Consultants’ Aggregate Voice on supply chain excellence.
This document provides an overview and analysis of the 2020 Supply Chains to Admire research. It identifies 22 companies that met the criteria to be named Supply Chains to Admire Award Winners based on their performance over a nine-year period from 2010-2019. The winners represented various industries including retail, process manufacturing, and discrete manufacturing. Trends are discussed showing improvements in discrete manufacturing winners while process winners declined. Common characteristics of winning companies include long-term leadership focus, robust horizontal processes, and managing complexity.
Relationship between Corporate Social Responsibility and Earnings Management ...ijtsrd
The relationship between corporate social responsibility CSR and earnings management EM is an extensive empirical study. However, the evidence on the nature of the relationship is unclear. A commonly defined reason for divergent and contradictory results is measurement issues. The purpose of this article is to evaluate alternative operation and measurement methods applied to the CSR and EM concepts in the empirical literature on CSR EM relationships. Our systematized appraisal was conducted over the last nine years from 2008 to 2016. This study has come to different observations. First, CSR measurement methods include sustainability indexes, content analyzes and single dimensional measurements, while EM measurement methods include discretionary accruals, discretionary loan loss provisions, real earnings management, abnormal earnings management, earnings persistence and earnings smoothing. In addition to the unique drawbacks of the approach, the subjectivity of the researcher and the selection anomalies that may influence the nature of the CSR EM relationships identified in the empirical literature. Finally, possible ways of overcoming these disadvantages are recommended. Mashiur Rahman | Sarah Chowdhury ""Relationship between Corporate Social Responsibility and Earnings Management: A Systematic Review of Measurement Methods"" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-4 | Issue-2 , February 2020,
URL: https://www.ijtsrd.com/papers/ijtsrd29987.pdf
Paper Url : https://www.ijtsrd.com/management/business-ethics-and-legal-issues/29987/relationship-between-corporate-social-responsibility-and-earnings-management-a-systematic-review-of-measurement-methods/mashiur-rahman
How Can You Drive Opportunity If You Cannot Manage Risk?Lora Cecere
Report Details: The research for this report was conducted via an online survey from March 12 - May 11, 2018. Surveys were conducted among 93 respondents -- a mix of business users (manufacturers, wholesalers/distributors/co-operatives, and third-party logistics providers, n=34), vendors (software providers and consultants, n=39), and others (academics, analysts, unemployed, and others, n=20).
Objective: To understand the current and expected future state of supply chain risk management, the biggest drivers of risk, and the impact on supply chain disruptions. NOTE: supply chain risk management is defined as the proactive identification and assessment of potential risks to the supply chain, as well as the development of strategies to avoid these risks.
Highlight: Nearly two-thirds of respondents believe that their company performs better today on risk management practices than five years ago yet they had 3.5 disruptions last year on average. Managing risk requires a network approach. Today’s investments in end-to-end supply chain are by and large not effective in risk mitigation. Only 37% have visibility of extended-tier suppliers and most lack the solutions to manage global complexity.
Three Techniques to Improve Organizational Alignment-9 July 2013Lora Cecere
When organizations are aligned, things happen quicker. It takes less effort. People know what to do, and there is a greater bias for action. As a result, the organization can achieve higher levels of results and better withstand the pressures of demand and supply volatility.
Line of business leaders lack alignment. While many consultants claim that business results happen through better IT and business alignment, in this study, we find that the gaps in functional alignment within the business functions of sales, marketing, finance, and supply chain are far greater than the gaps between IT and line of business.
As shown in figure 2, within the organization, demand and supply volatility reigns. It is growing worse. This pain is felt across the line of business functions. To weather the storm, functions attempt to align, but doing this is easier said than done. It requires work and leadership.
This misalignment is not equal by business function. Of the three groups in this survey—supply chain, finance and information technology (IT)—the supply chain organization feels the alignment issue to a greater degree than the other two business functions. As shown in figure 2, it is one of their top three business pains.
So, what can an organizational leader do to improve alignment? In this study, we find that when companies do three things, and focus on doing them well, they can substantially improve organizational alignment:
• Have a Clear Definition of Supply Chain Strategy. While many companies state that they want to be “agile,” it requires definition. Companies need to design a supply chain with this goal in mind. When the organization has a carefully crafted definition of agility, it is able to improve organizational alignment. The definition of “shorter cycles” is not sufficient.
• Sales and Operations Planning. Organizations with a mature S&OP process are more aligned. In this study, 61% of supply chain respondents report having an S&OP process, but 48% of that group rate their process as effective. For a more detailed analysis of S&OP, please refer to our report Sales and Operations Planning: Current State of the Union.
• Supply Chain Center of Excellence. Organizations with a supply chain center of excellence are more aligned. The greatest impacts are between marketing and finance, as well as operations and Corporate Social Responsibility.
The study shows that there is significant opportunity for organizations to improve on all three of these critical factors. The good news for supply chain leaders is that this study provides three clear actions that can deliver improved alignment.
At one time, the physical store defined the retailer. It was the brand. Today, this has changed. Now the store is a part of a cross-channel experience. It is a combination of goods and services. The impact of the change is different by retail sector, but it is pervasive.
While changes in other industries have happened incrementally through continuous improvement and process innovation, retail has been transformed by new business models. The pace is faster and the customer demands higher.
Redefining the role of the store is critical. It requires partnerships of both retailers and manufacturers. It is for this reason that we wrote this report.
Launch of the Supply Chain Index - 11 JUNE 2013Lora Cecere
This document introduces a new Supply Chain Index that aims to determine which supply chain metrics correlate most strongly with financial market valuations, as measured by market capitalization, across different industries. It describes 18 months of research analyzing correlations between supply chain financial ratios and market cap data for various industries. Key findings include that the metrics that matter most vary significantly by industry, and that some industries like household/personal products have clear supply chain leaders while others do not. The report aims to help supply chain leaders understand which metrics have the greatest impact on improving shareholder value for their specific industry.
Supply Chain Metrics That Matter: A Focus on Brick & Mortar Retail-18 FEB 2013Lora Cecere
The bricks and mortar retailer is being squeezed. Growth is slowing and margin is under pressure. With the rise of e-commerce, the role of the store is being redefined. It is about service and the customer experience. As a result, it is time to rethink the metrics that matter and focus outside-in on the shopper experience.
In this report, we share insights on the current state of bricks and mortar retail and offer our suggestions.
Brick & mortar retailers have weathered an intense decade with the persistent rise of e-commerce. The shopper has changed and recovery from the Great Recession is ongoing, but slow. Our previous Supply Chain Metrics That Matter: A Focus on Retail report focused on the broader industry trends affecting five different divisions of retailers and the challenges of multi-channel retail. This report narrows the focus to three segments of brick & mortar retailers struggling to adapt to the new world.
A retailer is not a retailer. We believe that retailers should be compared by business model. We do not believe that one can throw all retailers together and identify the “most improved” or “best” supply chain. There are too many variables and circumstances affecting the retail landscape to make valid comparisons. In our research, we find that small and well-defined peer groups offer the best way forward for understanding both segment and industry specific trends.
The industry segments analyzed in this report are grocery, mass and specialty. Grocery retailers are involved in the sale of perishable and non-perishable food stuffs. Mass retailers are larger companies focused on providing a comprehensive retail experience to their customers. Finally, specialty retailers are dedicated to specific customers, activities and goods. The companies in this analysis represent both American and global retailers.
Our grocery peer group consists of Carrefour, Delhaize Group, Safeway and The Kroger Co. The mass retailer peer group includes Costco, Metro, Target and Walmart. The choice of specialty retailers was by far the most difficult because there are so many dedicated stores in this category. For this publication, our peer group includes Bed Bath & Beyond, Dick’s Sporting Goods, Foot Locker and Ross Stores. Additional information about all of these companies is presented in the Appendix.
Consultants' Voice on Supply Chain Excellence - 20 August 2012Lora Cecere
This report is the second report in a two-part series. The first report published in May 2012 and represents the Supply Chain Executives’ voice and perspectives on supply chain excellence. This report is a companion report reflecting the views of consulting partners working on supply chain across multiple industries. In this report, we contrast the two views while sharing insights from the Consultants’ Aggregate Voice on supply chain excellence.
This document provides an overview and analysis of the 2020 Supply Chains to Admire research. It identifies 22 companies that met the criteria to be named Supply Chains to Admire Award Winners based on their performance over a nine-year period from 2010-2019. The winners represented various industries including retail, process manufacturing, and discrete manufacturing. Trends are discussed showing improvements in discrete manufacturing winners while process winners declined. Common characteristics of winning companies include long-term leadership focus, robust horizontal processes, and managing complexity.
Retail Scorecards Study 2014 - Summary Charts Lora Cecere
Executive Overview
Retail scorecards are now more than a decade old. The companies in this study had an average of more than five years of experience using retail scorecards. Buyers and suppliers now manage multiple scorecards simultaneously (in the same relationship) in trading partner communications. The most common scorecards are focused in the areas of supply chain.
As with any relationship, there is always a carrot and a stick. A carrot, or an incentive to do better, is a positive reward system given to affirm good behavior; while a stick is a punitive action for an unwanted behavior. Today, in the administration of retail scorecards, they are more focused on deductions and the withholding of payment.
The primary value of the retail scorecard is the improvement of on-time and in-full shipments. Both parties have the opportunity to use the scorecard to improve assortment and reduce total costs. Today, these opportunities are aspirational. Here we share the insights from the study and end with recommendations for both trading partners.
Market-driven S&OP Report - 16 July 2012Lora Cecere
This document outlines the evolution of Sales and Operations Planning (S&OP) processes through five stages of maturity:
1. Develop a feasible plan
2. Match demand with supply
3. Drive the most profitable response
4. Become demand-driven
5. Orchestrate through market-driven value networks
It discusses how the goal and technology needs change at each stage. Most companies are not clear on their S&OP goal or supply chain strategy, undermining their success. Moving to later stages requires redefining data models and inputs to enable more advanced modeling and optimization of demand, supply, inventory, and financial trade-offs. Building an effective S&OP process faces barriers including executive
The Role of Analytics In Defining The Art Of The PossibleLora Cecere
Analytics capabilities are evolving faster than organizations can adopt them into their processes. Here we share the research of 92 respondents in their journey to use new forms of analytics in their digital transformation journey.
Determinants of Audit Fees: Evidence from Pharmaceutical and Chemical Industr...ijtsrd
The main objective of this study is to find out the factors that determine the audit fees in the listed pharmaceuticals and chemicals companies of Bangladesh. The study is conducted on 21 listed companies in the pharmaceuticals and chemicals industry during the period of 2015 to 2018. Client characteristics client size, leverage and return on assets , client's governance structure independent directors and audit committee and firm ranking are taken as the proxy variables of the determinants of audit fees. The study has found that client size, leverage and firm ranking have positive and significant impact on audit fees of the sample firm. On the other hand the proportion of independent directors in the board has a negative and significant impact on audit fees. However, the study did not find any significant association between audit fees and return on assets. It is suggested that policymakers should include more independent directors in the board for ensuring better governance to reduce the external audit fees. Besides, in case of maintaining obligatory audit committee, companies should consider the efficiency and effectiveness of the committee. Md. Noor Hossain | Raihan Sobhan "Determinants of Audit Fees: Evidence from Pharmaceutical and Chemical Industry of Bangladesh" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-4 | Issue-1 , December 2019, URL: https://www.ijtsrd.com/papers/ijtsrd29656.pdf Paper URL: https://www.ijtsrd.com/management/accounting-and-finance/29656/determinants-of-audit-fees-evidence-from-pharmaceutical-and-chemical-industry-of-bangladesh/md-noor-hossain
The Supply Chains to Admire™ analysis is an annual study of supply chain excellence. Now in its fifth year of development, the focus of this research is to better understand supply chain performance and improvement of 655 publicly held companies in 28 peer groups for the period of 2010-2017. This year there are 31 winners! At the 2018 Supply Chain Insights Global Summit, winners from the analysis will share insights on driving supply chain excellence.
How Can You Drive Opportunity If You Cannot Manage Risk?Lora Cecere
25 July 2018
Report Details: The research for this report was conducted via an online survey from March 12 - May 11, 2018. Surveys were conducted among 93 respondents -- a mix of business users (manufacturers, wholesalers/distributors/co-operatives, and third-party logistics providers, n=34), vendors (software providers and consultants, n=39), and others (academics, analysts, unemployed, and others, n=20).
Objective: To understand the current and expected future state of supply chain risk management, the biggest drivers of risk, and the impact on supply chain disruptions. NOTE: supply chain risk management is defined as the proactive identification and assessment of potential risks to the supply chain, as well as the development of strategies to avoid these risks.
Highlight: Nearly two-thirds of respondents believe that their company performs better today on risk management practices than five years ago yet they had 3.5 disruptions last year on average. Managing risk requires a network approach. Today’s investments in end-to-end supply chain are by and large not effective in risk mitigation. Only 37% have visibility of extended-tier suppliers and most lack the solutions to manage global complexity.
What Drives Inventory Effectiveness in a Market-Driven World? Summary ChartsLora Cecere
Survey Details: The research for this report was conducted from February 12 – October 8, 2015. Surveys were conducted among Manufacturers, Retailers, and Wholesalers/Distributors/Co-operatives with $250M+ in revenue and who use (and are familiar with) inventory optimization software (n=64). Respondents were evenly split between those using basic (ERP or ERP+APS) and advanced (software in addition to ERP/APS) software. All surveys were conducted by Supply Chain Insights.
Objective: To understand the impact of inventory optimization software on supply chain excellence. NOTE: inventory optimization software was defined as “any form of ERP (Enterprise Resource Planning), APS (Advanced Planned Software), or sophisticated inventory planning tools.”
Highlight: Companies who use advanced software are more likely to be satisfied with their software, to be effective at making inventory decisions and to drive a return on investment for their software.
Talent: The Future Supply Chain's Missing Link - 13 AUG 2013Lora Cecere
Executive Overview
No supply chain leader will debate the importance of supply chain talent; they know that it is critical. Yet, we find that most companies are unaware of the current state and the criticality of immediate supply chain talent issues.
It is the dawn of a new era. Much to their chagrin, when companies go to the market to recruit, they are finding that the competition for supply chain talent has never been tougher. They simply are not able to find supply chain talent to backfill critical jobs.
In our study, we find five high-level findings that should be “stay awake issues” for the supply chain leader.
1. Opportunity for Improvement. In this study, more companies rate themselves as worse than their peer group in managing supply chain talent. The ratio is 2:1. In the study, when companies were asked to self-assess their capabilities to manage supply chain talent, 17% self-rated that they perform better than their peer group while 34% reported that they do worse than their peers.
2. High Turnover. There is currently a 15% turnover of supply chain employees. We believe it is increasing. In the study, 46% of companies attempt to hire from within the company and 17% fill roles primarily through recruiting talent from other companies.
3. Shortage of Talent. It is not easy to fill an open position in the open market for supply chain management due to current dynamics of demand and supply. The pain is more critical. The average company in the study has four positions open for five months. The most difficult positions to fill are in the areas of planning that require both a technical mastery of technology and an organizational understanding of the business drivers.
4. Stiff Competition for College Graduates. Today, there is a 6:1 demand to supply ratio for new college graduates in the supply chain field. Competition is intense and there is a lot of effort to attract the best and brightest.
5. Working on the Right Stuff? The current focus is on recruiting college graduates and high-performing talent. Less attention is being given to middle management where the shortage is the highest (see figure 2). Only 23% of companies responding to the study have a planned cross-functional training program for existing employees. This study points out the need for cross-functional skill development for mid-management supply chain leaders.
The Supply Chains To Admire Report for 2021Lora Cecere
The Supply Chains To Admire methodology tracks the rate of improvement and performance of 60 public companies in 28 industry sectors. Twenty companies outperform including In the 2021 analysis, twenty companies met the Supply Chains to Admire Award criteria. The winners include Apple, AbbVie Inc., Air Products & Chemicals, Assa Abloy AB, Broadcom, Celestica, Dollar General, Ecolab Inc., Intuitive Surgical, Inditex, Lockheed Martin Corporation, Nike Inc., Nvidia, PACCAR Inc, Ross Stores, Sleep Number, Taiwan Semiconductor Manufacturing (TSMC) Company, Tempur Sealy, TJX Companies, and Western Digital. No company met the criteria in seventeen of the twenty-six sectors studied.
Construction Concept and Project Finance Management Strategiesprojectfinancemgt
Among the best companies operating in Switzerland, Hestia is your ideal partner and offers its services for all your building and all your real estate projects, whether the transformation, renovation or even building your buildings. Visit: www.hestia.ch
How Do We Heal the Healthcare Value Chain?
Over the last decade, as shown in figure 1, the hospital supply chain has been one of the few that has improved operating margin, reduced inventory and improved revenue/employee. In contrast, the manufacturing suppliers to the hospital organization have grown inventories and struggled to preserve margins. Across the value chain from the patient to the raw material suppliers, total inventories have grown and costs have escalated. With pending regulations, hospitals are being forced to rethink processes, redefine value and work more holistically to improve sourcing practices. The suppliers to the hospital systems are having to rethink their systems to rethink the customer (from selling to the physician to selling to a more formal buying organization based on patient outcomes) and adapt to the new processes within the hospital for value analysis.
Supply chain processes within the hospitals have matured. Hospitals have made more progress on improving cash-to-cash cycles than their upstream manufacturing trading partners. They have reduced inventories and attempted to work with suppliers. As shown in figure 2, it is notable to see that this industry is one of the few where downstream trading partners have actually improved payable terms for their suppliers.
The future lies before the healthcare provider. As the provider of patient care, they have the greatest potential to lead in the healthcare value chain’s redesign to improve value. They have come a long way, but the changes have been incremental. They have focused primarily on traditional sourcing techniques; not a redesign of the healthcare value chain from the outside in, and the redefinition of complex and antiquated processes.
2014 Talent Study - Summary Charts - 18 AUG 2014 Lora Cecere
Executive Overview
Ask any supply chain leader, “Is the management of supply chain talent important?” and you will get an overwhelming “Yes!” as a response. Yet, only 14% of companies rate themselves as doing better than their peer group when it comes to managing supply chain talent. Surprisingly, 43% of the survey respondents believe that they perform worse on the management of supply chain talent than their peers. The ratio is 3:1. Why the gap? There are many drivers, but the primary reasons are three: management support, recruitment, and staff development. The open-ended responses from the survey are shown in Figure 2.
Driving Supply Chain Excellence Report -18 June 2015Lora Cecere
Executive Overview
Growth is slowing and the complexity in today’s supply chain is unprecedented. No two centers of excellence are the same, and no two supply chains are alike. There are different drivers and obstacles to building and running a Center of Excellence. However, if done right, the organization rates itself as more aligned, proactive and agile. The high-level results from our study are shown in Figure 2.
Figure 2. Centers of Excellence Infographic
Based on our qualitative interviews with clients, we find that these seven drivers to build a Center of Excellence:
• Increase in the Importance of Supply Chain Management. As growth slows, and the global multinational organization matures, more and more companies are interested in driving supply chain excellence. The reasons are many; but, at the top of the list is improving reliability in the face of volatility. How so? Demand volatility is increasing and supplier viability is growing more fragile. Driving reliability in global operations in the face of these challenges is fundamental to defining and executing supply chain excellence.
• Building of Global Teams and the Development of Supply Chain Talent. With the shortage of students from academia, and the retirement of the first- and second-generation supply chain pioneers, more and more companies are developing and executing programs to build supply chain talent. There is a shortage of mid-management talent with pressure on planning job retention. There is a limited supply of supply chain knowledge workers: leaders that are technologically savvy, analytical problem solvers, and astute in business processes.
• Continuation of Work on Enterprise Resource Planning (ERP). When companies complete a large ERP project, there is a strong impetus to get the value from the investment and ensure technology usage. The focus of the Center of Excellence often becomes an extension of the global implementation team.
• Metrics and Implementation of Analytics. While the management of supply chain excellence sounds easy, it is not. The management of order-to-cash and procure-to-pay processes and the supply chain execution processes are easier because they are well-defined. Most companies struggle with the definition of planning and the use of new forms of analytics.
• Network Design and the Orchestration of Flows. Most companies start on their supply chain design journey to save costs in logistics. With the increasing cost of transportation, and the fragility of freight networks, network design for transportation and logistics networks is paramount. One client likened it to “minting money.”
• Testing of New Technologies. Cloud technologies. Supply chain operating networks. The Internet of Things. 3D Printing. New forms of analytics. The list of technology and process disruptors could go on and on. While most companies feel stuck in their existing, and more traditional, processes they want to understand and explore technology
Etude PwC sur le reporting intégré (sept. 2014)PwC France
http://bit.ly/Reporting-PwC
Selon une étude du cabinet d’audit et de conseil PwC, 80 % des investisseurs s’accordent à dire qu’un reporting de qualité influence leur perception de l’entreprise. Pour près de deux tiers d’entre eux (63 %), la qualité du reporting d’une entreprise pourrait avoir un impact financier direct sur le coût de son capital.
Alliance portfolios and shareholder value in post-IPO firms: The moderating roles of portfolio structure and firm-level uncertainty by Nacef Mouri, M.B. Sarkar, Melissa Frye.
What Is the Value of a Retail Scorecard? - 21 OCT 2014Lora Cecere
This document summarizes the results of a study on the use of retail scorecards by 65 retailers and suppliers. Key findings include:
1. Scorecards have primarily improved on-time shipping performance but have more potential to impact assortment and costs. Both parties see opportunities for improvement that are not yet realized.
2. Retailers and suppliers have different needs and perspectives in using scorecards. Greater alignment is needed to improve areas like assortment.
3. Data sharing practices are still developing, with room for retailers to share more useful data like point-of-sale and inventory data.
4. Scorecards currently focus more on penalties than incentives, though a balanced approach could drive better
360 degree ei implementation business model – tool to achieve competitiveIAEME Publication
The document summarizes a research paper that developed a 360 Degree Emotional Intelligence (EI) Implementation Business Model. The paper conducted a comparative analysis of the EI-based stakeholder practices of 5 large, successful companies - Tata Steel, Walmart, British Petroleum, Toyota Motors, and Samsung Electronics. Across practices related to human resources, consumers, society, government/environment, investors, and third parties, the analysis found many similarities in how the companies prioritize satisfying stakeholders through EI initiatives, contradicting the hypothesis that EI is not a common factor in their success. Based on these findings, the research proposes a business model for new and small enterprises to implement EI strategies to achieve competitive advantages and sustainable growth
Research Overview:
Details: The research for this report is based on twenty-eight surveys fielded during the period of January 2012 – December 2015. The research was a progressive set of studies to understand supply chain excellence. In the report, we use responses from over 2000 respondents to understand the characteristics of a supply chain that is working well.
Objective: To better understand the levers and actions that are the most impactful for supply chain leaders to take to improve supply chain excellence.
Highlights: While many claim that consolidation of ERP instances will improve supply chain excellence, we find in this report that companies that report that their supply chains are working well have designed organizations to centralize reporting with manufacturing reporting to the supply chain leader In addition, these leaders invested in supply chain visibility, have a clearer definition of supply chain strategy to improve alignment and agility, and are better at delivering on technology projects to deliver software usability.
Executive Summary
The term ‘supply chain finance’ has different definitions on each continent. In Europe, it is often used to describe ‘tax efficiency’, or the design of the supply chain to reduce the burden of taxation of cross-border shipments. In many procurement organizations the term is often used to describe the use of favorable capital rates to finance downstream trade. In this study the focus is on the management of costs by either effectiveness of a Supply Chain Finance team or Supply Chain Center of Excellence, Sales and Operations Planning (S&OP) processes, Cost-to-Serve Analysis and Supplier Development efforts.
For the supply chain leader, managing costs is job one. It is easier said than done. The supply chain is a complex system with interrelationships between growth, inventory, cost and complexity. Cross-functional processes, organizational focus, and access to data are critical to align and maintain cost effectiveness in this complex system called supply chain. We term this model the Supply Chain Effective Frontier. This is shown in Figure 2. When companies operate on the Supply Chain Effective Frontier they maximize the value of the firm . We measure value by either Price to Tangible Book Value or Market Capitalization.
Figure 2. Supply Chain Effective Frontier
As will be shown in this report, managing costs is a struggle for most companies. While 88% of companies have implemented Enterprise Resource Planning (ERP), the hard work of process evolution and maturity continues. In this report we share the current state of supply chains in managing costs, and then take a look at the processes and organizational design factors to evaluate the impact on cost management.
Supply Chain Metrics That Matter: Driving Reliability in Margins - 6 JAN 2013Lora Cecere
Supply chain management practices are thirty years old. Over the last decade, companies have invested in technology projects to improve financial outcomes (Technology investments over this period have averaged 1.7% of revenue). The ultimate goal was to reduce costs and improve inventory management. While many supply chain leaders believe that they delivered on these metrics, we find a less persuasive story. Through analysis of publically available balance sheet and income statement data, we find that 75% of companies in process industries lost ground on margins and only 5% of companies improved their positions on the number of days of inventory. The goal of this report is to answer the question “Why?” (For more on inventory and the Cash-to-Cash Cycle, see Supply Chain Metrics That Matter: The Cash-to-Cash Cycle.)
To begin our analysis, we wanted to understand the general trends. In table 1, we share the differences in average values for the companies profiled in this report by industry for the period of 2000-2011. In general, we see a decline in operating margins (OM). There is an increase in selling, general & administrative Costs (SG&A) and revenue per employee performance. The industries have mixed results on return on assets (ROA).
SustainAbility launched a tool to help companies improve transparency in their sustainability reporting.
The report notes that in order for transparency to instigate change, companies must increase their efforts on three transparency elements: materiality, valuation of externalities and integration.
Retail Scorecards Study 2014 - Summary Charts Lora Cecere
Executive Overview
Retail scorecards are now more than a decade old. The companies in this study had an average of more than five years of experience using retail scorecards. Buyers and suppliers now manage multiple scorecards simultaneously (in the same relationship) in trading partner communications. The most common scorecards are focused in the areas of supply chain.
As with any relationship, there is always a carrot and a stick. A carrot, or an incentive to do better, is a positive reward system given to affirm good behavior; while a stick is a punitive action for an unwanted behavior. Today, in the administration of retail scorecards, they are more focused on deductions and the withholding of payment.
The primary value of the retail scorecard is the improvement of on-time and in-full shipments. Both parties have the opportunity to use the scorecard to improve assortment and reduce total costs. Today, these opportunities are aspirational. Here we share the insights from the study and end with recommendations for both trading partners.
Market-driven S&OP Report - 16 July 2012Lora Cecere
This document outlines the evolution of Sales and Operations Planning (S&OP) processes through five stages of maturity:
1. Develop a feasible plan
2. Match demand with supply
3. Drive the most profitable response
4. Become demand-driven
5. Orchestrate through market-driven value networks
It discusses how the goal and technology needs change at each stage. Most companies are not clear on their S&OP goal or supply chain strategy, undermining their success. Moving to later stages requires redefining data models and inputs to enable more advanced modeling and optimization of demand, supply, inventory, and financial trade-offs. Building an effective S&OP process faces barriers including executive
The Role of Analytics In Defining The Art Of The PossibleLora Cecere
Analytics capabilities are evolving faster than organizations can adopt them into their processes. Here we share the research of 92 respondents in their journey to use new forms of analytics in their digital transformation journey.
Determinants of Audit Fees: Evidence from Pharmaceutical and Chemical Industr...ijtsrd
The main objective of this study is to find out the factors that determine the audit fees in the listed pharmaceuticals and chemicals companies of Bangladesh. The study is conducted on 21 listed companies in the pharmaceuticals and chemicals industry during the period of 2015 to 2018. Client characteristics client size, leverage and return on assets , client's governance structure independent directors and audit committee and firm ranking are taken as the proxy variables of the determinants of audit fees. The study has found that client size, leverage and firm ranking have positive and significant impact on audit fees of the sample firm. On the other hand the proportion of independent directors in the board has a negative and significant impact on audit fees. However, the study did not find any significant association between audit fees and return on assets. It is suggested that policymakers should include more independent directors in the board for ensuring better governance to reduce the external audit fees. Besides, in case of maintaining obligatory audit committee, companies should consider the efficiency and effectiveness of the committee. Md. Noor Hossain | Raihan Sobhan "Determinants of Audit Fees: Evidence from Pharmaceutical and Chemical Industry of Bangladesh" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-4 | Issue-1 , December 2019, URL: https://www.ijtsrd.com/papers/ijtsrd29656.pdf Paper URL: https://www.ijtsrd.com/management/accounting-and-finance/29656/determinants-of-audit-fees-evidence-from-pharmaceutical-and-chemical-industry-of-bangladesh/md-noor-hossain
The Supply Chains to Admire™ analysis is an annual study of supply chain excellence. Now in its fifth year of development, the focus of this research is to better understand supply chain performance and improvement of 655 publicly held companies in 28 peer groups for the period of 2010-2017. This year there are 31 winners! At the 2018 Supply Chain Insights Global Summit, winners from the analysis will share insights on driving supply chain excellence.
How Can You Drive Opportunity If You Cannot Manage Risk?Lora Cecere
25 July 2018
Report Details: The research for this report was conducted via an online survey from March 12 - May 11, 2018. Surveys were conducted among 93 respondents -- a mix of business users (manufacturers, wholesalers/distributors/co-operatives, and third-party logistics providers, n=34), vendors (software providers and consultants, n=39), and others (academics, analysts, unemployed, and others, n=20).
Objective: To understand the current and expected future state of supply chain risk management, the biggest drivers of risk, and the impact on supply chain disruptions. NOTE: supply chain risk management is defined as the proactive identification and assessment of potential risks to the supply chain, as well as the development of strategies to avoid these risks.
Highlight: Nearly two-thirds of respondents believe that their company performs better today on risk management practices than five years ago yet they had 3.5 disruptions last year on average. Managing risk requires a network approach. Today’s investments in end-to-end supply chain are by and large not effective in risk mitigation. Only 37% have visibility of extended-tier suppliers and most lack the solutions to manage global complexity.
What Drives Inventory Effectiveness in a Market-Driven World? Summary ChartsLora Cecere
Survey Details: The research for this report was conducted from February 12 – October 8, 2015. Surveys were conducted among Manufacturers, Retailers, and Wholesalers/Distributors/Co-operatives with $250M+ in revenue and who use (and are familiar with) inventory optimization software (n=64). Respondents were evenly split between those using basic (ERP or ERP+APS) and advanced (software in addition to ERP/APS) software. All surveys were conducted by Supply Chain Insights.
Objective: To understand the impact of inventory optimization software on supply chain excellence. NOTE: inventory optimization software was defined as “any form of ERP (Enterprise Resource Planning), APS (Advanced Planned Software), or sophisticated inventory planning tools.”
Highlight: Companies who use advanced software are more likely to be satisfied with their software, to be effective at making inventory decisions and to drive a return on investment for their software.
Talent: The Future Supply Chain's Missing Link - 13 AUG 2013Lora Cecere
Executive Overview
No supply chain leader will debate the importance of supply chain talent; they know that it is critical. Yet, we find that most companies are unaware of the current state and the criticality of immediate supply chain talent issues.
It is the dawn of a new era. Much to their chagrin, when companies go to the market to recruit, they are finding that the competition for supply chain talent has never been tougher. They simply are not able to find supply chain talent to backfill critical jobs.
In our study, we find five high-level findings that should be “stay awake issues” for the supply chain leader.
1. Opportunity for Improvement. In this study, more companies rate themselves as worse than their peer group in managing supply chain talent. The ratio is 2:1. In the study, when companies were asked to self-assess their capabilities to manage supply chain talent, 17% self-rated that they perform better than their peer group while 34% reported that they do worse than their peers.
2. High Turnover. There is currently a 15% turnover of supply chain employees. We believe it is increasing. In the study, 46% of companies attempt to hire from within the company and 17% fill roles primarily through recruiting talent from other companies.
3. Shortage of Talent. It is not easy to fill an open position in the open market for supply chain management due to current dynamics of demand and supply. The pain is more critical. The average company in the study has four positions open for five months. The most difficult positions to fill are in the areas of planning that require both a technical mastery of technology and an organizational understanding of the business drivers.
4. Stiff Competition for College Graduates. Today, there is a 6:1 demand to supply ratio for new college graduates in the supply chain field. Competition is intense and there is a lot of effort to attract the best and brightest.
5. Working on the Right Stuff? The current focus is on recruiting college graduates and high-performing talent. Less attention is being given to middle management where the shortage is the highest (see figure 2). Only 23% of companies responding to the study have a planned cross-functional training program for existing employees. This study points out the need for cross-functional skill development for mid-management supply chain leaders.
The Supply Chains To Admire Report for 2021Lora Cecere
The Supply Chains To Admire methodology tracks the rate of improvement and performance of 60 public companies in 28 industry sectors. Twenty companies outperform including In the 2021 analysis, twenty companies met the Supply Chains to Admire Award criteria. The winners include Apple, AbbVie Inc., Air Products & Chemicals, Assa Abloy AB, Broadcom, Celestica, Dollar General, Ecolab Inc., Intuitive Surgical, Inditex, Lockheed Martin Corporation, Nike Inc., Nvidia, PACCAR Inc, Ross Stores, Sleep Number, Taiwan Semiconductor Manufacturing (TSMC) Company, Tempur Sealy, TJX Companies, and Western Digital. No company met the criteria in seventeen of the twenty-six sectors studied.
Construction Concept and Project Finance Management Strategiesprojectfinancemgt
Among the best companies operating in Switzerland, Hestia is your ideal partner and offers its services for all your building and all your real estate projects, whether the transformation, renovation or even building your buildings. Visit: www.hestia.ch
How Do We Heal the Healthcare Value Chain?
Over the last decade, as shown in figure 1, the hospital supply chain has been one of the few that has improved operating margin, reduced inventory and improved revenue/employee. In contrast, the manufacturing suppliers to the hospital organization have grown inventories and struggled to preserve margins. Across the value chain from the patient to the raw material suppliers, total inventories have grown and costs have escalated. With pending regulations, hospitals are being forced to rethink processes, redefine value and work more holistically to improve sourcing practices. The suppliers to the hospital systems are having to rethink their systems to rethink the customer (from selling to the physician to selling to a more formal buying organization based on patient outcomes) and adapt to the new processes within the hospital for value analysis.
Supply chain processes within the hospitals have matured. Hospitals have made more progress on improving cash-to-cash cycles than their upstream manufacturing trading partners. They have reduced inventories and attempted to work with suppliers. As shown in figure 2, it is notable to see that this industry is one of the few where downstream trading partners have actually improved payable terms for their suppliers.
The future lies before the healthcare provider. As the provider of patient care, they have the greatest potential to lead in the healthcare value chain’s redesign to improve value. They have come a long way, but the changes have been incremental. They have focused primarily on traditional sourcing techniques; not a redesign of the healthcare value chain from the outside in, and the redefinition of complex and antiquated processes.
2014 Talent Study - Summary Charts - 18 AUG 2014 Lora Cecere
Executive Overview
Ask any supply chain leader, “Is the management of supply chain talent important?” and you will get an overwhelming “Yes!” as a response. Yet, only 14% of companies rate themselves as doing better than their peer group when it comes to managing supply chain talent. Surprisingly, 43% of the survey respondents believe that they perform worse on the management of supply chain talent than their peers. The ratio is 3:1. Why the gap? There are many drivers, but the primary reasons are three: management support, recruitment, and staff development. The open-ended responses from the survey are shown in Figure 2.
Driving Supply Chain Excellence Report -18 June 2015Lora Cecere
Executive Overview
Growth is slowing and the complexity in today’s supply chain is unprecedented. No two centers of excellence are the same, and no two supply chains are alike. There are different drivers and obstacles to building and running a Center of Excellence. However, if done right, the organization rates itself as more aligned, proactive and agile. The high-level results from our study are shown in Figure 2.
Figure 2. Centers of Excellence Infographic
Based on our qualitative interviews with clients, we find that these seven drivers to build a Center of Excellence:
• Increase in the Importance of Supply Chain Management. As growth slows, and the global multinational organization matures, more and more companies are interested in driving supply chain excellence. The reasons are many; but, at the top of the list is improving reliability in the face of volatility. How so? Demand volatility is increasing and supplier viability is growing more fragile. Driving reliability in global operations in the face of these challenges is fundamental to defining and executing supply chain excellence.
• Building of Global Teams and the Development of Supply Chain Talent. With the shortage of students from academia, and the retirement of the first- and second-generation supply chain pioneers, more and more companies are developing and executing programs to build supply chain talent. There is a shortage of mid-management talent with pressure on planning job retention. There is a limited supply of supply chain knowledge workers: leaders that are technologically savvy, analytical problem solvers, and astute in business processes.
• Continuation of Work on Enterprise Resource Planning (ERP). When companies complete a large ERP project, there is a strong impetus to get the value from the investment and ensure technology usage. The focus of the Center of Excellence often becomes an extension of the global implementation team.
• Metrics and Implementation of Analytics. While the management of supply chain excellence sounds easy, it is not. The management of order-to-cash and procure-to-pay processes and the supply chain execution processes are easier because they are well-defined. Most companies struggle with the definition of planning and the use of new forms of analytics.
• Network Design and the Orchestration of Flows. Most companies start on their supply chain design journey to save costs in logistics. With the increasing cost of transportation, and the fragility of freight networks, network design for transportation and logistics networks is paramount. One client likened it to “minting money.”
• Testing of New Technologies. Cloud technologies. Supply chain operating networks. The Internet of Things. 3D Printing. New forms of analytics. The list of technology and process disruptors could go on and on. While most companies feel stuck in their existing, and more traditional, processes they want to understand and explore technology
Etude PwC sur le reporting intégré (sept. 2014)PwC France
http://bit.ly/Reporting-PwC
Selon une étude du cabinet d’audit et de conseil PwC, 80 % des investisseurs s’accordent à dire qu’un reporting de qualité influence leur perception de l’entreprise. Pour près de deux tiers d’entre eux (63 %), la qualité du reporting d’une entreprise pourrait avoir un impact financier direct sur le coût de son capital.
Alliance portfolios and shareholder value in post-IPO firms: The moderating roles of portfolio structure and firm-level uncertainty by Nacef Mouri, M.B. Sarkar, Melissa Frye.
What Is the Value of a Retail Scorecard? - 21 OCT 2014Lora Cecere
This document summarizes the results of a study on the use of retail scorecards by 65 retailers and suppliers. Key findings include:
1. Scorecards have primarily improved on-time shipping performance but have more potential to impact assortment and costs. Both parties see opportunities for improvement that are not yet realized.
2. Retailers and suppliers have different needs and perspectives in using scorecards. Greater alignment is needed to improve areas like assortment.
3. Data sharing practices are still developing, with room for retailers to share more useful data like point-of-sale and inventory data.
4. Scorecards currently focus more on penalties than incentives, though a balanced approach could drive better
360 degree ei implementation business model – tool to achieve competitiveIAEME Publication
The document summarizes a research paper that developed a 360 Degree Emotional Intelligence (EI) Implementation Business Model. The paper conducted a comparative analysis of the EI-based stakeholder practices of 5 large, successful companies - Tata Steel, Walmart, British Petroleum, Toyota Motors, and Samsung Electronics. Across practices related to human resources, consumers, society, government/environment, investors, and third parties, the analysis found many similarities in how the companies prioritize satisfying stakeholders through EI initiatives, contradicting the hypothesis that EI is not a common factor in their success. Based on these findings, the research proposes a business model for new and small enterprises to implement EI strategies to achieve competitive advantages and sustainable growth
Research Overview:
Details: The research for this report is based on twenty-eight surveys fielded during the period of January 2012 – December 2015. The research was a progressive set of studies to understand supply chain excellence. In the report, we use responses from over 2000 respondents to understand the characteristics of a supply chain that is working well.
Objective: To better understand the levers and actions that are the most impactful for supply chain leaders to take to improve supply chain excellence.
Highlights: While many claim that consolidation of ERP instances will improve supply chain excellence, we find in this report that companies that report that their supply chains are working well have designed organizations to centralize reporting with manufacturing reporting to the supply chain leader In addition, these leaders invested in supply chain visibility, have a clearer definition of supply chain strategy to improve alignment and agility, and are better at delivering on technology projects to deliver software usability.
Executive Summary
The term ‘supply chain finance’ has different definitions on each continent. In Europe, it is often used to describe ‘tax efficiency’, or the design of the supply chain to reduce the burden of taxation of cross-border shipments. In many procurement organizations the term is often used to describe the use of favorable capital rates to finance downstream trade. In this study the focus is on the management of costs by either effectiveness of a Supply Chain Finance team or Supply Chain Center of Excellence, Sales and Operations Planning (S&OP) processes, Cost-to-Serve Analysis and Supplier Development efforts.
For the supply chain leader, managing costs is job one. It is easier said than done. The supply chain is a complex system with interrelationships between growth, inventory, cost and complexity. Cross-functional processes, organizational focus, and access to data are critical to align and maintain cost effectiveness in this complex system called supply chain. We term this model the Supply Chain Effective Frontier. This is shown in Figure 2. When companies operate on the Supply Chain Effective Frontier they maximize the value of the firm . We measure value by either Price to Tangible Book Value or Market Capitalization.
Figure 2. Supply Chain Effective Frontier
As will be shown in this report, managing costs is a struggle for most companies. While 88% of companies have implemented Enterprise Resource Planning (ERP), the hard work of process evolution and maturity continues. In this report we share the current state of supply chains in managing costs, and then take a look at the processes and organizational design factors to evaluate the impact on cost management.
Supply Chain Metrics That Matter: Driving Reliability in Margins - 6 JAN 2013Lora Cecere
Supply chain management practices are thirty years old. Over the last decade, companies have invested in technology projects to improve financial outcomes (Technology investments over this period have averaged 1.7% of revenue). The ultimate goal was to reduce costs and improve inventory management. While many supply chain leaders believe that they delivered on these metrics, we find a less persuasive story. Through analysis of publically available balance sheet and income statement data, we find that 75% of companies in process industries lost ground on margins and only 5% of companies improved their positions on the number of days of inventory. The goal of this report is to answer the question “Why?” (For more on inventory and the Cash-to-Cash Cycle, see Supply Chain Metrics That Matter: The Cash-to-Cash Cycle.)
To begin our analysis, we wanted to understand the general trends. In table 1, we share the differences in average values for the companies profiled in this report by industry for the period of 2000-2011. In general, we see a decline in operating margins (OM). There is an increase in selling, general & administrative Costs (SG&A) and revenue per employee performance. The industries have mixed results on return on assets (ROA).
SustainAbility launched a tool to help companies improve transparency in their sustainability reporting.
The report notes that in order for transparency to instigate change, companies must increase their efforts on three transparency elements: materiality, valuation of externalities and integration.
A research proposal on non financial reporting by Fred M'mbololoFred Mmbololo
This research proposal compares non-financial reporting practices in Australia and the European Union. Non-financial reporting enables businesses to communicate their environmental, social, and ethical performance to stakeholders. In Australia, non-financial reporting is voluntary, while the EU's Non-Financial Reporting Directive mandates certain large companies disclose information on environmental, social, and governance matters. The proposal will explore differences and similarities in non-financial reporting frameworks and common CSR activities between Australia, the EU, and the US to identify variations in reporting forms and features.
The ES&G Accountability Forum (2013) provided participants and panelists with an opportunity to examine the question of how information (both financial and non-financial) can best be provided in a form that is useful to decision makers that are affected by, or have an affect on Canada’s companies.
This document captures key points made by panelists, their answers to questions posed, and the Forum’s participants’ table discussions. It is organized around each panel: investors, companies, evaluation organizations. We hope to encourage all groups to consider the advice and comments discussed at the Forum, and to take action on the outstanding questions and issues to improve the state of ES&G disclosure, analysis and investing that are highlighted on pages 9 & 10.
This year on September 23, 2014 in Calgary, many of these unanswered questions will be addressed at the ES&G Forum 2014: "Non-financial performance... A missed opportunity?"
Building on the last two years' discussions, participants will hear how investors and businesses are implementing innovative methods to manage investor demand for ES&G information. To learn more about & register for this year's ES&G Forum, please visit: http://bit.ly/esg-forum-2014
Integrated reporting 101; Getting started with Integrated Reporting in IndiaVrushali Gaud-Shinde
Introduction to Integrated reporting - India
The Securities Exchange Board of India (SEBI) recently raised a circular recommending top 500 companies to adopt Integrated Reporting. This is a quick guide that answers the Why? What? How? questions to get Indian companies started with Integrated Reporting.
Measuring Quality of Corporate Sustainability Reporting- A Case Study of the ...Lisa Cioffi
This document discusses corporate sustainability reporting and provides a case study comparing the reports of Toyota and Honda. It begins with background on the importance and growth of sustainability reporting globally. Companies are increasingly encouraged to report on non-financial issues due to investor and public pressure. The Global Reporting Initiative (GRI) publishes guidelines that are widely used for sustainability reporting. The document then analyzes the sustainability reports of Toyota and Honda to understand how they disclose information and compare their approaches, hypothesizing that their reasons and formats for reporting will differ despite both being automakers.
Term Paper: Towards a Definition of Organizational SustainabilityAntony Upward
This term paper for York University Master of Environmental Studies course ES/ENVS5150 Perspectives on Green Business (Fall 2010, Prof. Brian Milani) develops a working definition of organizational sustainability and explores the implications for the reporting of organizational performance.
This paper got a positive review from Prof. Milani who said the paper was "interesting and thoughtful".
The document provides a framework for developing and implementing a corporate sustainability strategy plan. It begins by discussing surveys that found awareness of sustainability's importance is growing among executives, but there is lack of consensus on what matters and how to measure its impact. The plan's goals are to help the company be recognized as accountable, assure capital market access, outperform on sustainability returns, and build reputation. The proposed framework involves 6 phases: 1) creating a sustainability culture, 2) mapping strategy areas, 3) benchmarking governance and finance standards, 4) assessing issues, 5) setting strategies and goals, and 6) an action plan. Benchmarking to standards like the Equator Principles and Dow Jones Sustainability Index can help lower costs
global reporting initiative & sustainability reportingNidhi Mathai
The document discusses sustainability reporting and the Global Reporting Initiative (GRI) framework for sustainability reporting. It provides information on:
- What sustainability reporting is and its importance for companies.
- The GRI sustainability reporting framework, including its principles, standard disclosures, and sector supplements.
- How the GRI framework has evolved over time from G3 to G4 guidelines.
- Key performance indicators reported in sustainability reports across economic, environmental, social, and governance topics.
- National and global trends in sustainability reporting adoption.
The document discusses green auditing, including planning, areas of concern, reporting, and implementation. It provides an overview of the necessity of green audits and differences between internal/external audits. Key aspects of audit planning discussed are engagement circumstances, risks, intended users, and standards like AA1000. Areas of concern addressed include regulations, waste management, and supply chain risks. Reporting guidelines from India, GRI, and benefits of reporting are covered. Implementation is shown to involve deciding to report, identifying impacts and audiences, and assuring and publishing the final report.
The document discusses green audit planning and reporting. It covers the necessity of green audits, audit planning considerations like engagement risks and intended users, areas of concern to audit like safety and waste management, and reporting guidelines. Reporting provides benefits like better performance measurement, stakeholder trust, and strategic advantages. In India, reporting is voluntary though the Companies Act requires some environmental reporting. Most large Indian companies follow Global Reporting Initiative guidelines in their sustainability reports.
Triggers and considerations for refreshing CSR marketing servicesTilly Pick
A major trend that I consider in my work and that is influencing tomorrow’s winners is the rise in environmental, social and governance principles (ESG). That’s code for “we need to all be considerate global citizens.” (CSR, or Corporate Social Responsibility, is how ESG relates to brand marketing.) People are taking notice, at all levels and everywhere. From stock exchanges to massive pension funds, the UN to Millennials, and big non-profits to those on shoe-string budgets, the discussions and work that are happening will lead to good things. For customers. Investors. Employees. Suppliers. Our communities, too. Nirvana for marketers wired to create value that makes a difference. Follow me here, on Twitter and LinkedIn if you feel the same way.
This document summarizes a study conducted by the Boston College Center for Corporate Citizenship and Ernst & Young LLP on the value of sustainability reporting. Some key findings from the study include:
- Sustainability reporting can provide major value to companies in areas like improved reputation, increased employee loyalty, risk management, and access to capital.
- The majority (95%) of large global companies now issue sustainability reports, with the Global Reporting Initiative framework being the most widely used standard.
- While data availability and resources remain challenges, transparency with stakeholders is a major motivation for companies to report across all industries.
The document discusses a model for assessing an accounting body's sustainability agenda. It analyzes key internal and external drivers that shape the body's sustainability efforts and how these drivers impact the business model. The model groups the drivers and matches them to components of the business model like advocacy, thought leadership, leading business, and skilling the profession. It provides examples of how sustainability reporting is affecting accountants' roles and skills.
Supply Chains to Admire - An Analysis of Supply Chain Excellence for 2006-2013Lora Cecere
Executive Overview
Supply chain excellence matters. It can make or break corporate performance. To drive improvements, companies need a clear definition of supply chain competency. It is easier to state than to define, and the market is full of beliefs that are not grounded by hard, cold facts.
Now 30-years old, the practice of supply chain management is still evolving. While companies speak of ‘best practices’, and boast about improvements in operating margin, inventory levels and asset management in conference after conference, we do not see it in our analysis of balance sheet information for any industry. The reason? The supply chain is not well-understood by executive teams, and many companies have pursued a project-based approach (implementing multiple projects with ROI above a threshold) or a focus on vertical excellence (where functional charters create very strong functional excellence); however, this is misguided. We do not find that these two approaches make a difference. Instead, we find that it is supply chain leadership driving resilient, predictable, and forward-looking processes that drives sustained balance sheet improvement. We find that for top performers that it happens in a slow and steady pattern versus the big-bang approach.
Supply chain leaders want to drive excellence. By their nature, these leaders are competitive. They want to drive performance improvements, increase corporate value and outpace competitors. It is not easy. The rate of business change is intense and the personal stakes are high. Day after day, leaders must answer questions like, “Which path should I to take? What are the best technologies to use? What is an acceptable rate of performance? How am I doing against my peer group? And, what can I learn from others that I can use to improve the performance of my own operation?” Until the development of the Supply Chain Index there was no independent and objective data-driven methodology that could answer these questions. With the development of this methodology, there now is a way to gauge improvement.
Collecting the data and doing the analysis in this report is the result of a 24-month effort. We were fearful at the end of the process that it would be difficult to pick the top performers, but we should not have worried. When we applied the methodology, the top companies hopped off the page. They were easy to spot. Listed by industry, the Companies to Admire are listed in Table 4. Within a peer group, we place them within alpha order. Due to the complexity of the analysis it is hard to rate them more granularly.
No companies made the list from the contract manufacturing, medical device, paper, pharmaceutical or retail peer groups. Likewise, there were more companies that made the list in the industrial than the consumer value networks.
Long Term Value Creation Through Integrated ReportingJDA SFAI
The document discusses integrated reporting, which IFAC strongly supports. It provides concise answers to questions about why IFAC sees integrated reporting as important, how it differs from and relates to other reporting frameworks, what value means in the context of integrated reporting, and how it fits within the corporate reporting landscape. Integrated reporting can help improve decision making, trust, and long-term thinking by evaluating an organization's impacts and dependencies more holistically in terms of financial, manufactured, intellectual, human, social, relationship, and natural capitals.
Executive Summary
Supply chain excellence makes a difference to corporate value. Resilient, predictable, and forward-looking supply chain processes drive sustained balance sheet improvement. This is especially true in times of declining growth. (In this research, only four industries—aerospace & defense, apparel, automotive, and packaging suppliers—experienced growth for 2009-2014.)
Leaders want to drive excellence. By their nature these leaders are competitive. They want to power performance improvements, increase corporate value, and outpace competitors. It is not easy. The rate of business change is intense and the personal stakes are high. Day after day, supply chain leaders must answer questions like, “Which path should I to take? What are the best technologies to use? What is an acceptable rate of performance? How am I doing against my peer group? And, what can I learn from others that I can use to improve the performance of my own operation?” Until the development of the Supply Chain Index there was no independent and objective data-driven methodology that could answer these questions. With the development of this methodology there is now a way to gauge improvement.
When we started this work we were fearful that the methodology would not be selective enough to reward leaders. Our fear was that the list would be too large. However, we should not have worried. For two consecutive years only 10% of the companies studied are performing above the average of their peer group on the Supply Chain Metrics That Matter—operating margin, inventory turns and Return on Invested Capital—while driving improvement to a greater degree than their peer group. It is a select group. Figure 5 shows the 26 winners of the 2015 Supply Chains to Admire analysis.
The 26 companies are: Anheuser-Busch InBev; Audi AG; Biogen Inc; CCL Industries Inc.; Cisco Systems, Inc.; Coloplast Corp.; CVS Pharmacy; Dollar General Corporation; Dollar Tree, Inc.; Eastman Chemical Company; EMC Corporation; The Estée Lauder Companies Inc.; General Mills, Inc.; Intel Corporation; Deere & Company; Lexmark International Inc.; L'Oréal Group; Nike, Inc.; PPG Industries; Qualcomm Inc.; Samsung Electronics Co. Ltd.; United Tractors; Wal-Mart Stores, Inc.; Western Digital Corporation; and Whole Foods Market Inc. (Note: Shorter corporate or trade names are used in the tables within this report.)
Seven companies have made the list for two consecutive years: Cisco Systems, Inc.; General Mills, Inc.; Eastman Chemical Company; EMC Corporation; Anheuser-Busch InBev; Intel Corporation; and Nike, Inc.
Sustainability Reporting: Definition, Benefits, And Challenges | Enterprise W...Enterprise Wired
Sustainability reporting has emerged as a critical tool for organizations to transparently communicate their environmental, social, and governance (ESG) performance.
Corporate Accountabiliyt Report, 11 care 848 - Greener Ledgers: The Practical...GRIUSA
Sustainability reporting has become increasingly common for companies as a way to publicly discuss issues related to climate change, resource use, community impact, and governance. While reporting provides opportunities to strengthen stakeholder relations and business practices, companies must work closely with legal counsel to ensure reports do not expose them to liability by being realistic about performance. Benefits of reporting include operating more efficiently and developing innovative products, while risks include potential litigation if reports misrepresent material information. Companies new to reporting should involve counsel throughout and focus on transparency, clarity, and accuracy to minimize legal complications.
Due to the current instability in the business world, organizations should be able to anticipate changes and have coherent responses at hand to effective manage risks, create value, build good relations, increase profit and improve competitive positioning.
A report titled Exploring Strategic Risk issued in 2013 for Forbes Insights by Deloitte, contains some very important conclusions for the business community. 300 executives from around the world were interviewed for the study, in an attempt to find out their vision of the risk strategy and current changes and analysing how organizations should face these new challenges.
Sometimes it is difficult to link risks to a specific financial impact and not all data are pertinent to the evaluation of emerging risks. That's why companies have to be aware of internal risks and manage them well in order to be able to manage external risks and invest into strategic assets such as human capital, clients and innovation.
This insight explains the case of the financial services as the sector that less trust generates due to its short-sightedness, lack of values and lack of professional education that resulted in corruption and bad practices, which compromised the financial sector.
The report A Crisis of Culture: Valuing Ethics and Knowledge in Financial Services examines the role of integrity and knowledge in restoring culture in the financial services industry. The conclusions appear in the full version of this document.
The financial industry is just one example in the wider panorama. Lack of values is widespread and creates significant risks. Bad practices trigger problems such as loss of profit, loss of reputation and even loss of shareholders, clients and employees.
The crisis, as well as the arrival of new technologies, urges companies to maintain their good practices and emphasize aspects as ethics, leadership, commitment, performance, transparency and sustainability.
The digital revolution and social networks encourage companies to be more transparent: companies meet their promises and obligations, deliver a coherent dialogue and improve the relationship with their stakeholders.
Application of values raises the possibility of good results and profits for companies through improvement of their reputation and business as well as optimization of resources. This certainly creates competitive advantages, establishes a strong cultural connection and improves employees’ motivation.
Before taking any decision, an institution should keep in mind the fact that it needs implicit and explicit public approval. Good business management implies risk management, creating a climate of trust, good will, credibility, social commitment and empathy between stakeholders and the company.
Similar to TACCT 521 Group Paper - SEND TO GROUP (20)
Aligning Corporate Strategy with Risks in order to avoid a Crisis
TACCT 521 Group Paper - SEND TO GROUP
1. University of Washington-Tacoma’s Milgard School of Business
TACCT521: International Accounting
Spring, 2016
Corporate Social Responsibility Reporting As
Analyzed by Independent Variables
Prepared by:
Caron Schmidt
Jamey Schoeneberg
Miriam Krause
Yalun Liu
Presented to:
Dr. Shahrokh M. Saudagaran
May 25, 2016
2. i
TABLE OF CONTENTS
INTRODUCTION..............................................................................................................1
METHODOLOGY.............................................................................................................2
HYPOTHESES .................................................................................................................4
ANALYTICAL FINDINGS...............................................................................................5
NATIONALITY.....................................................................................................................5
INDUSTRY .........................................................................................................................7
SIZE ..................................................................................................................................8
AGE ................................................................................................................................10
CONCLUSION................................................................................................................12
APPENDICES.................................................................................................................14
APPENDIX A: U.S. RANKING FOR NATIONALITY ANALYSIS...............................................14
APPENDIX B: U.K. RANKING FOR NATIONALITY ANALYSIS...............................................15
APPENDIX C: RANKINGS FOR INDUSTRY ANALYSIS.........................................................16
APPENDIX D: CATEGORY 1 OF SIZE ANALYSIS................................................................18
APPENDIX E: CATEGORY 2 OF SIZE ANALYSIS................................................................19
APPENDIX F: CATEGORY 3 OF SIZE ANALYSIS................................................................20
APPENDIX G: CATEGORY 4 OF SIZE ANALYSIS................................................................21
APPENDIX H: CATEGORY 1 OF AGE ANALYSIS................................................................22
APPENDIX I: CATEGORY 2 OF AGE ANALYSIS.................................................................23
WORKS CITED..............................................................................................................24
3. 1
INTRODUCTION
Companies worldwide strive toward many objectives beyond just
crunching numbers to arrive at the bottom line. Although profits are a key driver
to most management decisions, increased competition has led many companies
to go above and beyond what is required of them in order to appeal to potential
investors and other stakeholders. Companies are continuously seeking different
ways to not only improve performance, but to protect their assets, and win
shareholder and stakeholder trust. One of the ways companies are
accomplishing this is by implementing Corporate Social Responsibility (CSR)
reporting.
With the arrival of the 21st century, the concept of CSR reporting emerged.
In today’s world, companies worldwide report their social responsibility efforts as
a best practice. CSR reporting has become an important component of
employee, shareholder, and stakeholder relations, as its focus on sustainability
gears organizations around the world toward managing their environmental and
social impacts. As a byproduct of increasing sustainability efforts, CSR reporting
also serves as a way for companies to differentiate themselves in the competitive
market and to foster employee loyalty, as well as investor trust and confidence
(The Value of Sustainability Reporting).
There are many benefits to CSR reporting, including building a better
reputation, meeting expectations of employees, improving access to capital, and
increasing efficiency and reducing waste. Since companies are required to
gather information that they may not otherwise be collecting for financial
4. 2
statement purposes, they are equipped with new data that can provide them with
the necessary tools to reduce their use of natural resources, increase efficiency,
and improve their operational performance (The Value of Sustainability
reporting). Essentially, if companies truly are making efforts to make operations
more efficient, it will likely cut costs and create a win-win scenario for both the
company and society.
METHODOLOGY
We selected a sample of 50 companies, 25 of which are headquartered in
the United States of America and the other 25 are headquartered in the United
Kingdom. These companies are further broken down into five industries: airline,
hospitality, pharmaceutical, auto, and residential development. In regards to our
sample, in each country there are five companies in the airline industry, five in
hospitality, five in pharmaceutical, four in auto, and six in residential
development. The reason there are not five companies in each industry is
because there are not five automotive companies headquartered in the U.S. that
are not subsidiaries of foreign or domestic companies.
Our sample of companies consists of companies with some sort of CSR
report or information regarding sustainability located on its corporate website.
Furthermore, these companies all clearly indicated gross revenues. Companies
that did not provide information regarding their financial position or their
sustainability were not included as part of our sample.
With the 50 companies chosen, we use the Global Reporting Initiative’s
reporting guidelines to assess the quality of the companies’ CSR reports. The
5. 3
Global Reporting Initiative (GRI) serves as the premier standard and reporting
assistance in the world. Their commitment is to improving sustainability and
disclosures by assisting both firms and users in understanding the reporting of a
firm’s CSR actions and goals. GRI’s reporting guidelines are based on their G4
standard, which lists the following principles that should define the reported
content in a firm’s CSR: stakeholder inclusiveness, sustainability content,
materiality, and completeness. It is important to identify the stakeholders that will
assist in identifying the needed scope of the report that aligns with stakeholders’
interests and expectations. The report should also be placed in the proper
context of economic, environmental, and social conditions. To bring focus to the
report, a materiality threshold should be considered, which reflects the context
and interests of stakeholders. Finally, the basis of the report should be complete
and sufficient. This paper utilizes these principles to evaluate a firm’s CSR report
from a user perspective. Each principle was evaluated as non-existent, poor, fair,
and above expectations with the score of 0 - 3, respectively.
The GRI G4 rating also gives the following framework to score the quality
of each report on the following attributes: balance, comparability, accuracy,
timeliness, clarity, and reliability. A balanced report will give an unbiased picture
of the firm’s current condition, identifying both favorable and unfavorable material
results. It is important that the report clearly distinguish between facts and
interpretation of those facts. The report should be comparable over years, which
will assist stakeholders in identifying progress toward goals.
6. 4
Accuracy of the report is evaluated by sufficiency of information to
determine firm performance. This is determined by measurable data, which
should include both qualitative and detailed quantitative information. The report
should also be presented with timely, relevant, and reliable information to assist
stakeholders in evaluating the current status of the firm. All this information
should be written in a manner that is understandable and accessible to its users.
Finally, the information in the report should instill confidence in the reliability of
the information that is supported by internal controls.
This paper evaluates the quality of the CSR reports based on the prior
attributes of balance, comparability, accuracy, timeliness, clarity, and reliability.
Each attribute was evaluated as non-existent, poor, fair, excellent with the score
of 0 - 3, respectively. Because of the limits of this paper, the comparability
attribute for a firm’s CSR reports will be assumed to be consistent and given a
score of 3.
HYPOTHESES
For each category of analysis, before rating any CSR reports, we noted a
hypothesis based on what we anticipated our results would show. Our
hypotheses assume that the country, industry, etc. with the highest overall score
will have the CSR reports that are more user-oriented and useful. Our
hypotheses are based on knowledge gained from empirical studies reviewed in
class, group discussions, and independent assumptions and opinion. Our
hypotheses are as follows:
7. 5
i. H1: CSRs will be more useful if U.S. companies rather than U.K.
companies report them.
ii. H2: CSR reports in the airline and hospitality industries will be of higher
quality than the other examined industries.
iii. H3: CSR reports will be higher quality in larger companies.
iv. H4: CSR reports will be more useful to users of these reports if older
companies rather than newer companies report them.
ANALYTICAL FINDINGS
CSR reports were analyzed according to GRI criteria and scores were
compiled based on four different categories: nationality, industry, size, and age.
Each category was analyzed independently and did not take into consideration
the other variables.
Nationality as a Determinant of CSR Usefulness
In this study, one of the research methods was using the country as a
determinant to evaluate the usefulness of CSR. First, we classified all 50
companies into two categories by their nations, then we calculated the average
principle scores, average attribute scores, and the average total scores as well
by these two categories, as shown in the following Table #1.
Table #1
Country
Principle
Mean
Attribute
Mean
Cumulative
Mean
U.S. 10 15.04 25.04
U.K. 8.8 14.12 22.92
8. 6
We can see from the table above, both average principle score and
average attribute score of US companies are higher than those of U.K.
companies. The average principle score of US companies is 10 while the
average principle score of U.K. companies is 8.8; the average attribute score for
US companies is 15.04 but for U.K. companies is 14.12. Therefore, on average,
the total ranking of each US companies is 2.12 times greater than the total
ranking of each U.K. companies.
To further research, we analyzed the companies in each country based on
their total ranking from the highest to lowest score (See Appendices A and B).
We found that the number of companies that had a cumulative score of over 25
is higher in the U.S. as compared to in the U.K. sample. By contrast, the number
of companies with a cumulative score of less than 5 is greater in the U.K. group
than in the U.S. group. Overall, the sample of U.S. companies had better CSR
reports than the sample of U.K. companies. Therefore, H1 is affirmed.
As a stakeholder, it is highly possible that the nationality of a company is
an important factor when deciding whether or not to invest in it. The quality of a
company’s CSR reports is also important while making this decision. Therefore, if
it were possible to know that one country’s CSR reports were more useful and
reliable than another’s, an investor would likely prefer to invest in the company
with the more quality CSR reporting. Since our studies found that, at least in this
case, CSR reports of U.S. companies are better than those of U.K. companies,
and therefore an investor would be more likely to invest in one of the U.S.
companies than one of the U.K. companies.
9. 7
Industry as a Determinant of CSR Usefulness
As a part of our analysis on Corporate Social Responsibility reporting, we
examined the relationship between industry and CSR cumulative mean score
(based on the GRI standards). Our objective was to determine whether we
identified a trend associated with CSR reporting quality based on type of
industry, without the consideration of any other variable (such as location, age,
size, etc.).
Our sample consisted of 50 companies, which included eight companies
from the automobile industry, 12 from the residential development industry, and
10 from both the hospitality and pharmaceutical industries. Each company’s CSR
reports were rated on a cumulative (sum of principle and attribute criteria) scale
from 0-30, and averaged. Our findings can be observed in Table #2 below.
Table #2
Industry
# of
Firms
Principle
Mean
Attribute
Mean
Cumulative
Mean
Cumulative
Rank
Automobile 8 8.5 13.4 21.9 4
Residential
Development 12 8.5 12.1 20.1 5
Airline 10 10.7 17.1 27.8 1
Hospitality 10 9.2 14.1 23.3 3
Pharmaceutical 10 10.1 16.4 26.5 2
The airline industry had the highest cumulative average score of 27.8.
Following closely behind was the pharmaceutical industry with a cumulative
average score of 26.5. The hospitality industry had a score of 23.3. The
automobile industry had a score of 21.9. Lastly, the residential development
10. 8
industry had the lowest cumulative average score of 20.1. See Appendix C to
better understand how the mean amounts were calculated for each industry.
With regards to our H2, our overall results show that the airline and
pharmaceutical industries had CSR reports with the most user-oriented
information available for stakeholders who are interested in social responsibility
practices. Although the hospitality, automobile, and residential development
industries had lower cumulative scores, we found them to be fairly informative
and useful for stakeholders as well. Our hypothesis was partially confirmed.
It is important for users of CSR reports to consider industry variables when
comparing the usefulness of CSR reports. Standards vary from one industry to
the next, and what is crucial in one industry may be immaterial in another. For
example, the airline industry may address fuel consumption in its sustainability
reporting, whereas the hospitality or residential development industry would not
likely address such a component. If a stakeholder was comparing CSR reports,
the fact that a hospitality company CSR report lacks information about fuel
sustainability efforts does not make it inferior to the airline CSR statistics. Users
must remember to keep these types of variations in mind when making decisions
based on CSR reporting.
Size as a Determinant of CSR Usefulness
We chose to classify the 50 evaluated firms by their 2014 total revenue in
USD into four different classifications: $0 - $3,000M, $3,000M - $7,500M,
$7,500M - $50,000M, and firms over $50,000M. The smallest firms by size made
up 32 percent of the surveyed firms. The next two classifications by firm sizes
11. 9
each contain 24 percent of the firms. The final classification, which contained the
largest firms, represented 20 percent of the surveyed firms. A CSR mean of each
classification was taken on the basis of principle, attribute, and total rating. Our
findings are presented in Table #3.
Table #3
Category
Total Revenue
(In millions)
# of
Firms
Principle
Mean
Attribute
Mean
Cumulative
Mean
1 0 - 3,000 16 7.44 12.19 19.63
2 3,000 - 7,500 12 10.58 15.5 26.08
3 7,500 - 50,000 12 11.08 17 28.08
4 50,000 + 10 10.4 16.1 26.5
Possible 50 12 18 30
As the table shows, the principle score for the revenue classifications from
the smallest to the largest firms was 7.44, 10.58, 11.08, and 10.4, out of a
possible score of 12. The attribute score for each revenue class from smallest to
largest was 12.19, 15.5, 17, and 16.1, out of a possible 18 points. The total score
for each revenue class from smallest to largest was 19.63, 26.08, 28.08, and
26.5, out of a possible 30 (Table #3). Appendices D through G show the attribute,
principle, and cumulative scores for each individual company in each of the four
categories.
The smallest firms had the lowest scores in both principle and attribute,
which lead us to believe our H3 would be confirmed. This may be due, in part, to
limited resources and limited public demand in relation to firm’s size. This study
showed a positive relationship between firm growth and CSR scores to a point.
However, at the highest classification level scores receded slightly, forcing us to
12. 10
reject our H3. Approximately two-thirds of the reduction was due to lower
attribute scores. This reduction was primarily caused by the reports receiving a
lower score in regards to balance reporting. The larger firms were more likely to
only report positive outcomes from CSR activities and negated to list limitations
or challenges the firms may have been experiencing in attaining their goals.
The firms with the highest total CSR scores were in the $7,500 - $50,000
(in millions) classification. This classification maintained the highest mean in both
principle and attribute score. These firms had complete and easy to understand
reports, showing both successes and challenges in attaining goals. As a
collective, they also included more stakeholders than other firms. This may be
due to their competition with the larger firms and the need to increase credibility
with stakeholders. Because the largest firms have very strong brands and very
loyal customers, this may reduce their need to expose themselves to possible
negativity by reporting unfavorable information.
Age as a Determinant of CSR Usefulness
To determine whether age serves as a determinant of CSR usefulness,
we researched the age of each of the 50 companies, compiled the findings in a
table, and organized the 50 companies based on their age from the oldest
company to the youngest company. We then grouped the companies into three
groups, two of which were analyzed. The oldest 21 firms and the youngest 21
firms were analyzed to determine if the age of the company affects the
usefulness of CSRs. The firms that did not fit into these two categories were not
analyzed. Furthermore, the reason for choosing 21 of the companies with the
13. 11
greatest number of years in business and those with the fewest, within our
sample, was simply for aesthetic purposes. Had we chosen to analyze 20 firms in
the two age categories the largest number in Category 2 would have stopped at
39 years instead of 40 and the smallest number in Category 1 would have started
at 71 rather than 70. We believed that visually it made sense to simply extend
each group by one company, making the number of firms in each of the two
categories equal to 21.
What we found while analyzing these two groups is that, overall, the older
firms have better CSR reports than the younger firms, confirming our H4. Though
the low and high principle, as well as the high attribute and the high overall
ranking, are the same for each category of companies, the low attribute is one
point lower for the younger companies. In addition, the low overall rank for the
younger companies is lower than that of the older companies.
Regarding the means, the principle, attribute, and overall ranking
averages are 11.15, 16.9, and 28.05, respectively, for the older companies. For
the younger companies, the averages for these three rankings are 9.05, 14.15,
and 23.2, respectively. These results are also evident below, in Table #4. See
Appendices H and I for a more thorough table of findings.
Table #4
Category Age
# of
Firms
Principle
Mean
Attribute
Mean
Cumulative
Mean
1
70-179
Years 21 11.15 16.9 28.05
2
0-40
Years 21 9.05 14.15 23.2
14. 12
There is a drastic difference in the number of years in each category of
companies, which likely contributes to the conclusion that older firms, within our
sample, have better CSR reports than the younger firms. The total years that
Category 1 companies have been in business add up to 2,063 years, as opposed
to the total number of Category 2 years, which equals 519 years. The average
years of a company in Category 1 and Category 2, therefore, are roughly 98 and
25 years, respectively. With this large difference in age, it is understandable that
the older firms would have more quality CSR reports, because they have likely
been reporting on their sustainability efforts longer than the newer companies,
and likely have more knowledge as to what is expected of them.
What this all means for users of CSR reports is that they can likely expect
that older companies will have better quality CSR reports. If an investor is trying
to determine a company to invest in, and this decision were based on the
usefulness or its CSR reports, the investor would likely choose to invest in an
older company in our sample instead of a newer one.
CONCLUSION
After collecting a sample of companies with specific characteristics and
observing their CSR reports, we came to a conclusion on four hypotheses. Our
first conclusion is that CSR reports in the United States are more useful than
those in the United Kingdom. The second conclusion is that CSR reports in the
airline and pharmaceutical industries are more user-oriented. Third, we found
fairly inconclusive results regarding size as a determinant of the usefulness of
CSR reports because, though the cumulative mean rose as the gross revenue
15. 13
increased, in the highest-revenue category the cumulative mean dropped. Our
fourth hypothesis was confirmed, affirming our belief that older, more
experienced, companies would likely have higher quality CSR reports than
younger, inexperienced firms. What this means to the users of CSR reports is
that, at least in regard to our sample, they would generally find better, more user-
friendly CSR reports in companies in the United States, in the airline and
pharmaceutical industries, in companies with moderately high gross revenues,
and in older firms.