LOCAL, PROVINCIAL AND NATIONAL BUSINESS ENVIRONMENT

LOCAL, PROVINCIAL AND NATIONAL BUSINESS ENVIRONMENT 21 FEBRUARY 2013

Lesson Description

In this lesson, we:

Analyse and evaluate the extent to which a business venture addresses issues such as human rights, inclusivity and environmental issues.

Examine a variety of business-related information (verbal and non-verbal format, including graphs), how to respond professionally to questions and feedback, and amend information.

Examine exam and general questions.

Key Concepts

Terminology

Inclusivity:

The process of including all population groups and not discriminating against anyone.

Human rights: The correct manner in which everybody must be treated, as laid down by democratic government.

PDI:

Previously disadvantaged individual.

HDI:

Historically disadvantaged individual.

Human Rights

(Adapted from Business Studies for all, Grade 12, MACMILLAN, Pg. 72) Human rights can be explained as the correct manner in which all people must be treated. A human right is something that we are entitled to by virtue of the fact that we belong to the human race. They are personal liberties that protect individuals and groups against individual or state conduct prohibited by international law or custom. Human rights laws have been defined by international conventions and treaties, and by organisations such as the United Nations. Everyone is entitled to basic human rights, such as the right to freedom of speech, freedom of association, freedom to practise one's religion, freedom of movement, freedom to live where one chooses, etc. In South Africa in the Apartheid days, Blacks were denied their basic human rights, but as we are a democracy now, human rights apply to everyone. The rights all citizens now have are enshrined in the Bill of Rights, Section 9 of the Constitution. It is against the law to discriminate against anybody in terms of age, race, creed, culture or gender.

Inclusivity

(Adapted from Business Studies for all, Grade 12, MACMILLAN, Pg. 73) The most important Acts addressing inclusivity are the Employment Equity Act and Broad-Based Black Economic Empowerment. There are many other Acts dealing with this issue to some degree or another, such as the Basic Conditions of Employment Act and the Skills Development Act. In the work place, the South African government wants historically disadvantaged people (HDIs) and previously disadvantaged people (PDIs) included in the workplace and given equal opportunities. Workplaces must be more representative of the demographics of the country ? this means that all population groups of both genders and of all ages, and cultures must be included in the workplace.

Environmental Issues

All businesses have a responsibility to protect the environment as businesses use resources from the natural environment in their daily operations.

This leads to exploitation of natural resources, pollution and global warming. Businesses generate a lot of commercial waste through their daily operations. Legislation has been passed to put pressure on businesses to consider their environmental impact,

and businesses that do not comply can be fined. Businesses should ensure environmental sustainability and not compromise the ability of future

generations to meet their own needs.

Business enterprises should develop environmental policies which aim to: o Promote nature conservation o Lead to the development of alternative sources of energy o Minimise pollution

The 'triple bottom line'

(Adapted from Business Studies for all, Grade 12, MACMILLAN, Pg. 74 - 76)

When we talk of the `bottom line' we mean the last line in a company's balance sheet which shows whether they have made a profit or not.

However, as we have discussed previously, a business is expected to do more than just focus on profits ? they need to be good corporate citizens.

In terms of the King II Report on Corporate Governance in South Africa, companies are now expected to disclose a balance between their economic, social and environmental performance.

This is why it is called a `triple bottom line' ? these three issues, and what the company is doing about them, must be disclosed.

A company must act ethically and responsibly while pursuing their primary objective ? to make a profit ? by demonstrating their concern for social problems and the environment.

 (Ethics, which we discussed in Grades 10 and 11 means knowing the difference between right and wrong, and always doing the right thing.)

We will discuss each of these issues:

Economic focus

All companies must make a profit to ensure the continuity of the business. For listed companies, where the public have bought shares, it is their duty to the shareholders to

ensure they receive a return on that investment ? either by way of dividends and/or the share price increasing. Would you invest in a company that is not making any money for you? Listed companies have to disclose their financial dealings to the public and it is their ethical duty to be as transparent as possible in the way in which they disclose their financial dealings. In terms of legislation these days, it is mandatory to disclose all sorts of information, including directors' salaries and bonuses. All enterprises, big and small, are expected to run the financial aspects of their business according to GAAP (Generally Accepted Accounting Principles)

Social responsibility

All companies are expected to help address social problems, such as HIV/AIDS, crime, poverty, etc. A listed company's annual report will detail exactly what they are doing, and how much money they

are spending on social responsibility programmes. Remember that all businesses, even if they are sole proprietors, can do something to help. Money does not have to be spent, as time (volunteering for social causes), goods and services can

be donated to worthy causes.

Environmental issues

This is an area of increasing concern, as in the past many companies damaged the environment in numerous ways by being totally irresponsible and/or not spending money to rehabilitate (fix) the environment.

Environmental pollution Covers a range of problems from toxic waste being dumped into rivers; dust, smoke and odours (smells) in the air; noise and vibration; depleting (using up) resources such as timber, minerals etc. to unsightly mine dumps, abandoned, rusty factories and other health and safety hazards. Environmental problems are very important as in turn they affect our health and our quality of life ? thus they have both economic and social consequences. Excessive, prolonged noise can lead to deafness (as in the mines), toxic waste can cause cancer and other illnesses, smoke and dust lead to respiratory problems, etc.

 Unsightly buildings, factories, mine dumps, huge holes in the ground (such as from a quarry), litter, and waste dumps are a form of visual pollution and can also be dangerous for the surrounding community. Excessive pollution leads to the depletion of the ozone layer (which protects us from UV rays), greenhouse gases and acid rain ? all these problems are ruining the planet!

These days, stringent legislation exists, which forces companies to clean up after themselves, and imposes rules and regulations regarding pollution.

Companies who can be proved to be polluting the environment can be subject to stiff penalties and fines.

Business Related Information

Oral reports

You have probably had some experience of oral reports when the teacher has asked you to present your findings on a topic to the class.

The same scenario would apply in the workforce; your boss might ask you to go and check on something, or investigate something, and then report back to him/her.

You could report back to him/her orally (i.e. by talking). Sometimes you might be asked to deliver an oral report to more than one person, such as the

members of a board, or a committee, etc.

Written reports

Using the above scenario, and presuming your boss was on leave, for example, he/she might ask you to write a report on your findings so that it can be dealt with on his/her return.

In this case you would then prepare a written report.

Using graphics

Any verbal (oral or written) report will be much improved with the use of supplementary graphics. Graphics can be tables (like the ones in this textbook), photographs, graphs (pie charts, bar graphs,

Gantt charts, etc.), technical drawings and so on. Graphics help the reader (or the people listening to the report) see all the information at a glance (in

the case of graphs), and they also help them understand exactly what you mean (photographs, drawings, etc.) An oral report that uses graphics is usually called a presentation. Consider your school report ? it is probably presented in a graphic format (using symbols, tables, percentages, etc.) so that you can see at a glance how you did.

Questions

Question 1

(Adapted from DOE Nov. 2010)

Discuss how businesses in South Africa can contribute to human rights, inclusivity and environmental issues in the workplace. (18 marks)

Question 2

(Adapted from DOE Mar. 2009)

Discrimination in the workplace is one of the human rights issues that has a negative impact on the relationship between employers and employees.

a.) Do you agree or disagree with this statement? Motivate your answer.

(4)

b.) Indicate how discrimination can be resolved in the workplace.

(4)

Question 3

(Business studies for All, Grade 12, MACMILLAN, Activity 1, Pg. 77) List FIVE ways the Elsie can ensure her company respects human rights and inclusivity the Cultural Village.

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