Olivia Bags, Inc., owns a leading brand of backpacks and handbags in the Canada, based in Toronto,
Question:
Olivia Bags, Inc., owns a leading brand of backpacks and handbags in the Canada, based in Toronto, Ontario. The owner, Andrew Thomas, has decided that the company needs to adopt a more active CSR profile. Andrew has decided to allocate $1 million over the next 5 years to support some sort of charitable or socially responsible activity. Andrew has asked his senior executives to develop proposals.
Olivia Bags's vice president for marketing, Slivie Winters, has proposed an idea that Andrew is supporting: to create a subsidiary brand to be called Enviro Bags, which would be made from recycled polyester and which would employ a one-for-one giving approach. For every bag purchased, a backpack would be given to a promising student in a developing country. Andrew Thomas has always insisted on the highest quality for his bags and is fanatical about the life span of zippers. He is convinced that low-income people in developing countries probably have to settle for low-quality bags, which break easily, and make it difficult for students to transport their school supplies.
The role of devil's advocate is taken on by Andrew's vice president for finance, Diane Renfrew, who believes that the plan is impractical and that it would be simpler to give money to a promising charity. "How are we going to get these bags to the kids?" she asks, "We don't have any overseas sales offices. So how much money are we going to spend flying someone around the world, transporting bags through customs? The kids would probably prefer the cash; they could buy their own bags. Besides, how many of our customers are going to buy an expensive backpack just so kids overseas can get a free one? It's different with TOMS Shoes; most Canadians have many pairs of shoes and they feel bad for a kid without shoes. But most people only have one backpack, and they probably don't feel that sorry for someone who doesn't have a good backpack. If we don't sell any of these bags, how are we going to pay for sending them overseas?"
Andrew admits that Diane makes some interesting points, but he still supports the idea. He organizes a meeting and assigns executives to develop arguments for the idea of the one-for-one bag. Remember, Andrew is ready to commit $1 million to some charitable enterprise. If you do not think the one-for-one approach is a good idea, give examples of projects that you feel would represent a better use of the money, you need to make a recommendation.
Provide, a recommended approach/business case for a socially responsible initiative - please explain why you selected this recommendation - pros/cons. (3 marks)
2. Develop a stakeholder map for this initiative using the stakeholder template provided and demonstrated in lectures. You must identify a minimum of five key stakeholders.
a. After identifying the stakeholders, what are some of the next steps you would recommend?
b. How would you prioritize the stakeholders?
3. If the company were to create a report on CSR or ESG, answer the following questions:
a. Which department would you recommend to be an appropriate department to create the report and why?
b. Which reporting guideline(s) should the company use and why?
c. If the company were to proceed with integrated reporting, what six elements should it include? Describe the six elements in your own words and apply some of the known facts from the case where possible.
4. How will you measure the success of your plan by addressing the following:
a. what specific measurement(s) would you recommend;
b. what are the standards and tools you would recommend?
5. You will review the 15-step implementation plan checklist (included below) and provide evidence and comments for each step to show that you considered it in your paper discussion for this initiative.
Intermediate Accounting
ISBN: 978-0071339476
Volume 1, 6th Edition
Authors: Beechy Thomas, Conrod Joan, Farrell Elizabeth, McLeod Dick I