Stargaze ltd had challenges for activists$$ concerns regarding the working conditions, pay for workers in the outsourced factories that they use to manufacture dog accessories.

Stargaze ltd has tried to respond to these concerns for the last $5$ years. They reduced the number$/$ amount of factories it uses, created a supplier code of conduct, and started monitoring the factories. However, inadequate working conditions persisted. These led to customer calls for boycotting, and a pet retailer recently cancelled purchases of products $($ this customer is small$),$ but the management team is concerned that additional customers will join the boycott.

The management team have proposed ideas to address the activist concerns, and improve working conditions and pay the outsourced factories.

Review the proposal attached and provide thoughts, please explain the pros and cons and provide recommendations for next steps.

$"$To address activists' concerns and improve working conditions and pay at

outsourced partner factories, we are proposing the following:

Allow more effective oversight of the outsourced manufacturing factories by

further reducing the number of outsourced manufacturing factories.

Create partnerships with selected factories by offering long$-$term purchase

contracts.

Increase factory profitability by collaborating with factory owners to achieve

more efficient production.

Improve working conditions and pay by requiring factory owners to comply

with the Supplier Code of Conduct and share improved profits with workers as

agreed to in the long$-$term purchase contract.

The Supplier Code of Conduct includes the following provisions regarding factory

workers:

The workers who manufactures Stargaze ltd products are paid a fair wage, are treated

fairly, and work reasonable hours.

Factory working conditions are safe and frnd form unions.

No children work in factories that produce Stargaze products."

Please use management accounting protocols.