Corporate Governance and Innovation

The provided document is a compilation of references related to corporate governance, innovation, and social responsibility. It discusses how changes in technology can help businesses grow economically, increase productivity, and improve profitability. The assignment emphasizes the need for effective corporate governance to implement these changes responsibly, ensuring that business practices align with societal expectations.

Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
TASK 1............................................................................................................................................1
Understanding of innovation and the role of technological change in economic growth...........1
Overview of company and demonstrate how innovation impact the operation, sales and profit
of the organisation.......................................................................................................................3
TASK 2............................................................................................................................................4
Briefly explain Corporate Governance along with responsibility of BOD to the stakeholders..4
Explain Four areas of CSR through Archie Carroll model.........................................................5
CONCLUSION................................................................................................................................6
REFERENCE...................................................................................................................................8

INTRODUCTION
Business environment is the mixture of internal as well as external factors which
influence or affect the organisation. These factors also affect each other and it will impact the
operation of business (Belloc, 2012). It is a marketing term which affect the internal environment
along with their ability and it helps in developing and maintaining successful customer relation.
Further it will helps in organisation to achieve their business goals & objectives which increase
productivity as well as profitability. This report divided into two parts where first part chose
Britvic Plc, which is British producer of soft drinks and it is based in Hemel Hempstead. It is
founded in 1845 and important people of the business is John Daly. For second part Bovis
Homes Group Plc is UK based house building company and it based in Kings Hills. This file
contain information regarding innovation & how it impact and CSR in context of organisation
with the help of Archie Carroll model.
MAIN BODY
TASK 1
Understanding of innovation and the role of technological change in economic growth
Technological innovation consist new product or processes and change in the technology
to producing any goods. Innovation implement in the organisation when they introduce new
product in the market. Technical change impact the economy and it's growth all over the world
where company use innovative technology in order to gain more productivity or profitability.
Economic growth influenced by the change in technology due to this innovation and technology
advancement are critical to critical in economy. Companies spend huge amount on their R&D
part where they determined the innovative technology which help the company to grow. With the
help of four methods business can identify the growth through innovation and it include R&D,
human capital, learning by doing and public infrastructure.
Change in the technology will help the economy to grow because it is regarded as
primary source in economic development. Various or regular changes in the technology
contribute for the development of underdeveloped countries (Hopkins, 2017). Both factors are
inter related or impact each other. Rapid growth in the economy van be achieved through high
level of technology. Economic growth only achieved by the innovation or technological progress
in the organisation. Growth of Net National income of developing country not able to claim that
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it will be happen because of only capital. According to Kindleberger, in the organisational
productivity increase due to change in technology and it help the company to grow in the
economy. Robert Solow said that, in the U.S economy 2/3rd growth happen because of change in
the technology in their operational functions.
Change in the technology will impact the production function where less capital
investment or less labour efforts involve. Use of technology reduce the time as well as money
because it will provide high productivity in less time or efforts. Generally technological
advancement is essential rather then capital formation. But only capital formation will provide
growth at certain point after that progress will be stop due to lack of technological change.
Growth of economy is depend on the technological changes and it resulted, it reduce the cost of
production which increase productivity and profitability of the company. Use of new technology
helps in manufacturing cheap quality goods and it will enhance the international competition of
an individual country. Quality of growth is the most important or requirement for the business to
sustain in the market for the longer period (Maas and Reniers, 2014).
Technology plays very important role in the organisation for the economic progress. It
will increase the productivity of labour, requirement of human capital in term of skilled and
professional person when company change the technology. It will provide better living standard
for the individual where people enjoy quality of life and economic growth in terms of national
income, per capital income increased by using new technology and it will provide better quality
of life. Companies output will be increased due to increase in labour productivity and it cause
national income of country also gain. According to Keynes, increment in the supply is possible
when organisation change the technology. It will increase the demand of products which reduce
the chances of inflation in the country. With the help of technological change, business can
internationally trade through producing enough quantity with the help of technology.
Advancement of infrastructure improve the workplace experience such as use of atomic energy
or use of gas in place of petrol and various software to handle daily activities or maintain
records. Technology will reduce cost of product or provide economic of scale and overcome
from vicious circle of poverty.
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Overview of company and demonstrate how innovation impact the operation, sales and profit of
the organisation
Britvic Plc is UK based British soft drinks producer company and it is listed on London
Stock Exchange. Britvic founded in 1845 and the key people of the organisation is John Daly
and it is based on Hemel Hempstead, England, UK. Currently this company export their products
in the approx 50 countries. This company manufacture drinks under their own name and it have
operations in Great Britain (GB), Brazil, Ireland and France. Across these four markets,
company generate strong portfolio with own brand. It include Tango, drench, MiWadi, J2O etc.
and along with this, in the GB & Ireland country Britvic produce and sell various number of
PepsiCo's famous products. These products include Pepsi, 7UP, Mountain Dew and SoBe under
special agreement (Perks and et.al., 2013). Britvic is the largest supplier of drinks in Great
Britain and industry leader in the Ireland & France. Company grow very well in the other
countries, specially in US. Management team of the company successfully develop their
strategies in order to achieve their business goals & objectives which further increase
productivity as well as profitability.
If Britvic not change technology in the organisation function so it will create issues in
financial and Information Communication Technology (ICT) in the organisation. Large number
of transfection not recorded by the company if technology is not updated. Use of technology help
the finance department to handle their internal activities accurately. It will help globally to
develop capital budget or create global finance function and other issues related to security,
privacy, infrastructure management, regulatory compliances, cloud computing, budgets and
controlling cost. By use of technology and change according to the requirement can face all the
issues which occur in the business at the time of performing their task or duty. For example in
the Britvic company, manager purchase new machinery which produce soft drinks faster in
comparison to the older one and it required only single person to handle it. It will increase the
efficiency of operations, increase sale because of higher productivity and it will generate more
profit more he company (Sapra, Subramanian and Subramanian, 2014).
Company have to follow various standard which already mention in their code of best
practices under corporate governance. It includes various standard or rules which they have to
follow ethically. To follow proper rules and regulations in the organisation called ethical
practices. Where they increase productivity or profitability through producing best quality
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product and in favour of their customers to satisfy their need & desire. Britvic company majorly
focus on their soft drink quality which rather than use cheap quality material to save their cost. If
any organisation done this, that means they don't follow corporate governance and not perform
their ethical duties & practices (Sodeyfi, 2016).
TASK 2
Briefly explain Corporate Governance along with responsibility of BOD to the stakeholders
Corporate governance is the set the some rule, regulation, practices and standard which
help the organisation to perform their operational activities along with it, direct & control the
firm. Which help the business to perform their ethical practices to satisfy their stakeholder.
Corporate governance help the business to balance their activities to the interstate of their
stakeholders as well as shareholders. It include customer, supplier, management, investors,
community and government. This system help the organisation to control their internal activities
and direct them to move into right direction which is helpful for the company as well as for their
related parties such as stakeholders.
Board of Director (BOD) have huge responsibility in relation to company's stakeholder
where director have to be look after business activities and it is in position of trust or not. BOD
have to follow various rules and have duty to fulfil in respect of the organisation. Director have
responsibility to ensure that company prepare their books of accounts or not and it required to
pay off debt. If they find guilty to done any wrongful trading activity, so it will make it
personally liable for this (Strathoff, 2014). Director must be use their power for organisational
benefit, honest, have relevant skills and consider the interest of employees. For example, Bovis
Homes Group Plc BOD fulfil their responsibility regarding their stakeholder. Where they done
ethical practices to achieve more profitability and satisfy their stakeholder. BOD provide better
infrastructure to the employee, quality product to the customers, higher returns to investors,
timely payment of tax which satisfy government and done various social activities for the
development of community.
Corporate social responsibility is the business practice where company perform their duty
ethically in order to achieve success in the market through focusing on community and done
various activity of the welfare of people (Thomas and et.al., 2013). It include the careful
consideration regarding community, society, environment and human rights. It is important for
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the company to perform their responsibility because it is good practice for the social and
environmental issues. CSR policy of Bovis Homes Group Plc support the sustainable
development of the society. Company develop various policies regarding health, safety &
welfare and environmental policy. Bovis Homes Group Plc spend £25.7 million in 2018 and
£24.4 million in 2017 on their CSR activities (Walker and Jones, 2012).
CSR activities are important for the organisation because it will improve the image of the
company in front of public where people can choose to buy their product. It increase the brand
awareness among the consumers so they get aware about their launched product and
recommended others too. CSR helps in cost saving because customers are aware about their
products so they can save money from packaging and it automatic reduce the cost. So people can
easily afford this product to buy. It also provide advantage in comparison to their competitors
due to good image in public. In addition, it increase the customer engagement as well as
employees engagement and provide more benefits to the employees. So basically, CSR activity
is beneficial for the organisation as well as for their stakeholders.
Explain Four areas of CSR through Archie Carroll model
CSR pyramid model is the framework which argue about why and how business can
fulfil their social responsibility. Bovis Homes Group Plc follow Archie Carroll's model to
identify that how they can meet with their corporate social responsibility. It has some key
features which and it included that CSR is the base of profit and it comes first. After this
company ensure that it complies with all regulations & laws and also ensure that organisation
meet with their ethical responsibility or duties (Wilden and et.al., 2013).
Archie Carroll's model include four responsibility and first one is Economic
responsibility which include the responsibility of business to generate profit through their
operational functions. Generate more profit is the only way to survive in the business
environment for the longer period and make them capable to achieve their goals & objectives in
the competitive environment. Bovis Homes Group Plc need to maintain strong economic interest
so organisation stay for the longer period and being profitable and connected with their
shareholders through proving value is the part of CSR. Second responsibility of the company
related to the legal aspect which they have to fulfil. Because Bovis Homes Group Plc need to
follow all regulations & rules related to their operations. Management need to obey laws and
fulfil other responsibilities. Bovis Homes have to follow various act which is essentially required
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for the organisation to maintain internal environment and provide effective culture so employees
can perform well in the conformable workplace. Such as Employment Act, Health & Safety Act,
Minimum Payment Wage Act, Equality, Sex Discrimination Act etc. For example, in the
organisation people are not equality treated, salary distribution is different and people get
promoted because of their personal relation (Yun, Won and Park, 2016). So it is against the law
and company not bale to fulfil their legal responsibility. It impact the organisation in terms of
employees leave the organisation which affect the company's productivity and probability. So it
is important for the Bovis Homes Group Plc to follow every regulation & laws or become legally
responsible which positively affect the company.
Third stage of this model is ethical responsibility that is most important because it shows
that company is honest or not, or they follow their best practices or not. It include the
responsibility where Bovis Homes Group Plc have to act ethically and morally. Company have
to perform their duty beyond the rules, regulation and standards. Management need to be polite
with their employees or supplier, it is not compulsion but is it important to respect those who
work for the organisation. Manager of the Bovis Homes need to behave well with suppliers,
customers, employees and maintain good relation with their stakeholders. Fourth & last stage of
Archie Carroll model is Philanthropic responsibility which include the pay back time to the
society. Because society help the organisation to grow and make them capable to achieve their
goals. So it's corporate responsibility too to don something for the community and it's called
corporate social responsibility (CSR). Where company done various CSR activities in order to
provide sustainable development in the society. For example Bovis Homes Group Plc spend
huge amount on their CSR activities which is related to the Health & Safety of people (Zengand
and Duan, 2012).
Bovis Homes Group Plc adopt this model to analyse or identify their responsibility and
then develop various strategies which help develop various activities. By following this model
company successful done their CSR activities which help the business to improve their image
among the customers. Further it will increase the the productivity as well as profitability that is
main aim of the company.
CONCLUSION
As per above discussion, it has been concluded that innovation and changes in the
technology help the business to grow economically. It increase the productivity and profitability
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that required for the company to achieve their business goals & objectives. Change in technology
provide economic progress and along with this management need to follow corporate governance
for the effective implication. In addition, with the help of Archie Carroll model business identify
their responsibly and start giving efforts to fulfil their responsibility towards society.
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REFERENCE
Books & Journals
Belloc, F., 2012. Corporate governance and innovation: A survey. Journal of Economic Surveys.
26(5). pp.835-864.
Hopkins, M., 2017. CSR and international development. In CSR and Sustainability (pp. 88-108).
Routledge.
Maas, S. and Reniers, G., 2014. Development of a CSR model for practice: connecting five
inherent areas of sustainable business. Journal of Cleaner Production. 64. pp.104-114.
Perks, K. J., and et.al., 2013. Communicating responsibility-practicing irresponsibility in CSR
advertisements. Journal of Business Research. 66(10). pp.1881-1888.
Sapra, H., Subramanian, A. and Subramanian, K. V., 2014. Corporate governance and
innovation: Theory and evidence. Journal of Financial and Quantitative Analysis.
49(4). pp.957-1003.
Sodeyfi, S., 2016. Review of literature on the nexus of financial leverage, product quality, &
business conditions. Journal of Economic & Management Perspectives. 10(2). pp.146-
150.
Strathoff, P., 2014. The VBA Model and Public Value: Filling the Value Gap. Business and
Professional Ethics Journal, 33(4), pp.297-319.Matei, M. and Voica, M.C., 2013. Some
Considerations Regarding the Social Responsibility of Entrepreneurs in the European
Union. International Journal of Sustainable Economies Management (IJSEM). 2(1).
pp.26-35.
Thomas, T., and et.al., 2013. Leading change and innovation in teacher preparation: A blueprint
for developing TPACK ready teacher candidates. TechTrends. 57(5). pp.55-63.
Walker, H. and Jones, N., 2012. Sustainable supply chain management across the UK private
sector. Supply Chain Management: An International Journal. 17(1). pp.15-28.
Wilden, R., and et.al., 2013. Dynamic capabilities and performance: strategy, structure and
environment. Long Range Planning. 46(1-2). pp.72-96.
Yun, J., Won, D. and Park, K., 2016. Dynamics from open innovation to evolutionary
change. Journal of Open Innovation: Technology, Market, and Complexity. 2(2). p.7.
Zeng, L., Li, L. and Duan, L., 2012. Business intelligence in enterprise computing
environment. Information Technology and Management. 13(4). pp.297-310.
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