Star Corp. is the largest retailer in Malaysia, Indonesia, Singapore and Brunei with RM15 billion in...

 

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Star Corp. is the largest retailer in Malaysia, Indonesia, Singapore and Brunei with RM15 billion in sales. The company employs 50,000 employees in the four countries and serves 20 million customers per week. Star Corp. carry an extensive range of products from groceries and households items to home improvement and leisure products. The company has a core of loyal customers who love the fast, friendly service and high quality products with lower prices. The CEO who is also the grandson of Star Corp's founder always ensures the company lives up to its credo of supplying consumers with low-cost quality goods. Business Week reported that Star Corp was one of the most profitable companies in South East Asia. Employees receive good training in customer service. Customers are assured of a pleasant shopping experience where Star Corp's employees are friendly and ready to assist whenever they need help. However, this good image is tainted with complaints against the way Star Corp treats its employees. In Indonesia, for example, employees complained that they were forced to work "round the clock" without or with only little overtime pay. The backroom employees receive low pay and low benefits, mainly because they are immigrant workers. Employees often asked to sacrifice their rest and meal breaks. In Malaysia, Star Corp. was accused of hiring illegal immigrants with low pay to do menial jobs. These employment practices are clearly against the law, but Star Corp. got away due to weak enforcement of laws. While customers love Star Corp, small local sundry shops and merchants complain of unfair competition. Many went out of business because Star Corp. sells similar products, but at lower prices. Star Corp. could afford lower prices due to hefty discounts given by its suppliers for large orders. In additional, in Malaysia many local suppliers complained that Star Corp. gives priority to foreign products such as those from China and Bangladesh. Some even had to close their business. Star Corp. buys its products from these two countries due to cheaper prices. In Indonesia, Star Corp. has embarked on an aggressive expansion strategy due to the great market potential. Star Corp plans to open 20 stores each in east java and northern Sumatra next year. Ten new stores are due to be opened in Sulawesi this year. Star corp receives severe resistance from local communities in some of the new locations. Their main grouses are traffic congestion, noise and other forms of pollution during and after the construction of the new stores. They do not want star corps' presence disturbing their daily lives. In Malaysia, star corp gets the same resistance, but at a lower scale. The main grievance is the employment of illegal immigrants to construct new stores, which raises security concerns among locals due to a sudden influx of foreign workers I their area. In spite of its critics, star corp received wide support and many consider the company to be socially responsible in addition to being a provider of thousands of jobs, low prices and high value and service. Star corp also undertakes some initiatives to give back to the society. For example, star corp awards annual scholarships to secondary school children from poor an underprivileged families in Indonesia and Malaysia. The company is also active in promoting good environmental practices such as recycling and using paper bags. Moreover, it also sponsors educational programmed organized by local environmental groups to educate the public about recycling and other environmental topics. Based on the case above, execute your answer for the following questions below a) Star Corp is a good player in every aspect. Customers love them and their products too but they are not worrying about their stakeholders i.e. employees, competitors and society. Identifies issues raised by its various stakeholders. (12 marks) b) Assess Star Corp's corporate social responsibility using Caroll's four layer CSR model (20 marks) c) As an accountant, give your overall comments about Star Corp related to Corporate Governance and Corporate Social Responsibility. (4 marks) Star Corp. is the largest retailer in Malaysia, Indonesia, Singapore and Brunei with RM15 billion in sales. The company employs 50,000 employees in the four countries and serves 20 million customers per week. Star Corp. carry an extensive range of products from groceries and households items to home improvement and leisure products. The company has a core of loyal customers who love the fast, friendly service and high quality products with lower prices. The CEO who is also the grandson of Star Corp's founder always ensures the company lives up to its credo of supplying consumers with low-cost quality goods. Business Week reported that Star Corp was one of the most profitable companies in South East Asia. Employees receive good training in customer service. Customers are assured of a pleasant shopping experience where Star Corp's employees are friendly and ready to assist whenever they need help. However, this good image is tainted with complaints against the way Star Corp treats its employees. In Indonesia, for example, employees complained that they were forced to work "round the clock" without or with only little overtime pay. The backroom employees receive low pay and low benefits, mainly because they are immigrant workers. Employees often asked to sacrifice their rest and meal breaks. In Malaysia, Star Corp. was accused of hiring illegal immigrants with low pay to do menial jobs. These employment practices are clearly against the law, but Star Corp. got away due to weak enforcement of laws. While customers love Star Corp, small local sundry shops and merchants complain of unfair competition. Many went out of business because Star Corp. sells similar products, but at lower prices. Star Corp. could afford lower prices due to hefty discounts given by its suppliers for large orders. In additional, in Malaysia many local suppliers complained that Star Corp. gives priority to foreign products such as those from China and Bangladesh. Some even had to close their business. Star Corp. buys its products from these two countries due to cheaper prices. In Indonesia, Star Corp. has embarked on an aggressive expansion strategy due to the great market potential. Star Corp plans to open 20 stores each in east java and northern Sumatra next year. Ten new stores are due to be opened in Sulawesi this year. Star corp receives severe resistance from local communities in some of the new locations. Their main grouses are traffic congestion, noise and other forms of pollution during and after the construction of the new stores. They do not want star corps' presence disturbing their daily lives. In Malaysia, star corp gets the same resistance, but at a lower scale. The main grievance is the employment of illegal immigrants to construct new stores, which raises security concerns among locals due to a sudden influx of foreign workers I their area. In spite of its critics, star corp received wide support and many consider the company to be socially responsible in addition to being a provider of thousands of jobs, low prices and high value and service. Star corp also undertakes some initiatives to give back to the society. For example, star corp awards annual scholarships to secondary school children from poor an underprivileged families in Indonesia and Malaysia. The company is also active in promoting good environmental practices such as recycling and using paper bags. Moreover, it also sponsors educational programmed organized by local environmental groups to educate the public about recycling and other environmental topics. Based on the case above, execute your answer for the following questions below a) Star Corp is a good player in every aspect. Customers love them and their products too but they are not worrying about their stakeholders i.e. employees, competitors and society. Identifies issues raised by its various stakeholders. (12 marks) b) Assess Star Corp's corporate social responsibility using Caroll's four layer CSR model (20 marks) c) As an accountant, give your overall comments about Star Corp related to Corporate Governance and Corporate Social Responsibility. (4 marks)

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Solution Answer for a The major concerns that stakeholders express would be Though they like the products 1 Identifying stakeholders is harder than it looks While most protect leaders will say that id... View the full answer