Ethics and Sustainability in Chatime Australia: A Business Report

This report presents a business case analysis of Chatime Australia, addressing its ethical and sustainability challenges, specifically the excessive use of single-use plastics. The report begins with an executive summary, followed by an introduction outlining the importance of ethical and sustainable business practices. It then summarizes the scenario, highlighting Chatime's operations and the environmental impact of its plastic consumption. The core of the report utilizes stakeholder theory to analyze the issue, identifying key stakeholders and assessing how the company's practices affect them. The analysis examines the impact of economic, commercial, social, and environmental trends on Chatime's behaviors. The report proposes three alternative solutions to mitigate plastic waste, including the use of alternative materials like paper, bamboo, and reusable cups. Recommendations are provided to reduce Chatime's plastic footprint and enhance stakeholder awareness. The conclusion reinforces the need for Chatime to eliminate plastic usage to ensure long-term sustainability and maintain a positive public image. The report emphasizes the importance of ethical business practices in today's environmentally conscious world.

Running head: ETHICS AND SUSTAINABILITY
Ethics and Sustainability
Name of the Student:
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Author note:

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Executive Summary
This case study report has been elaborated on presenting a brief analysis of Chatime,
Australia and its barrier to ethical and sustainable business practices. It has analysed how the
ethics and sustainability can impact on the day to day work experience of a company.
Stakeholder theory has been used in place to analyse the issue and the impact of economic,
commercial, social and environmental trends on organisation’s ethical and sustainability
behaviours has been highlighted.

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Table of Contents
Introduction................................................................................................................................3
Discussion..................................................................................................................................3
Summary of the Scenario...........................................................................................................3
Description of the theory used for analysis............................................................................4
Analysis of the Issue..............................................................................................................5
Identification of three alternative solutions............................................................................6
Recommendations......................................................................................................................7
Conclusion..................................................................................................................................8
References:.................................................................................................................................9

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Introduction
Ethical and sustainable businesses are key to long term growth and success of each
and every organisation, particularly in the contemporary world where consumers have
become highly health and environment conscious than ever before (Porter & Kramer, 2019).
This paper shall elaborate on presenting a scenario report, analysing a sustainability issues
facing by Chatime, an International flavoured tea business present in Australia. The main
issue that is faced by the company is the use of single-use plastics and its waste. In this paper,
recommendations on how this issues should be dealt with would be provided and would
employ stakeholder theory as the analytical tool for the scenario.
Discussion
Summary of the Scenario
As stated above, Chatime is an Australian multinational flavoured tea company,
established by Henry Wang You-Hui in the year 2005. The company has growth and
expanded significantly ever since its emergence. It serves tea drinks by means of brewing
with full packets of fresh ingredients, flavours and also serve over ice. However, as any
beverage company, it makes use of plastic cups, cup lids, plastic films and straws. Being a
corporate entity, the company needs to respond to huge number of ethical issues within its
scope of operations for advocating its corporate responsibility. At present, it is facing an
ethical issue of lack of environmental sustainability measures that is depicted from its use of
plastic products. This issue is presently at the forefront of the domain of Corporate Social
Responsibility (CSR) for most of the companies as the global production of plastics is
continuing to increase at a rapid pace and according to the recent reports, more than 87% of
plastic waste generation was already been detected (Melubo & Lovelock, 2018). This is
developing the reputation of the company in negative manner throughout the world.

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Description of the theory used for analysis
The theory that is chosen for using in the analysis of the company is that of the
stakeholder theory. This theory was developed by Edward Freeman (Strand & Freeman,
2015). According to the theory, the stakeholders of a company are basically the ones that are
affected one or the other way by the company and its business operations. Therefore, the
companies are bound to make a profit that has the potential to stakeholders and shareholders
and at the same time, can ensure positive growth and development of the company in the
business market. The key stakeholders of Chatime are its parent company (La Kaffa
International Co. Ltd.), its founder and chairman (Henry Wang Yao-Hui), the employees and
the directors of the company, its suppliers, the public shareholders in the stock market of
Taiwan, the Franchise investors and its partners (WeCHat and AirAsia Airlines).
This theory also postulated that there are several groups present in the society that a
company can impact on by means of its business practices (Harrison, Freeman & Abreu,
2015). All these groups have the full right on the company for their own interest to be
addressed by the company as of the agency relationship that prevails in between them. The
business operations of a company influence the interest of different involved parties that have
stake in a business (Freeman, Kujala, Sachs & Stutz, 2017). In the same way, behaviour of
different parties also influence the interests of a business. Hence, companies need too
incorporate the expectations of its stakeholders into their policies and planning. It is to note
that the stakeholders, no matter how they act (formally or informally; collectively or
individually) are the key elements in the external environment of a firm and they can have
both the positive and negative impact on the organisation. The main challenge for a company
lies in the task of identifying who they are responsible to and how far that responsibility is
extending. Underpinning all the difficulties for managing the relation in between the business
and its stakeholders are the issues like conflicting expectations and divergent expectations

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between the stakeholders. It is to mention that stakeholder theory is a key element of CSR in
the open system in which a company interacts within a society, the different groups of people
having their own sets of expectations, demands and needs to personify each and every
interactions.
Analysis of the Issue
As mentioned earlier, Chatime is currently facing an issue in terms of ethical and
sustainable business practise. It makes use of single use plastic products throughout its
business operation. This issue is presently at the forefront of the domain of Corporate Social
Responsibility (CSR) for most of the companies as the global production of plastics is
continuing to increase at a rapid pace and according to the recent reports, more than 87% of
plastic waste generation was already been detected. This is developing the reputation of the
company in negative manner throughout the world. Since the year 1950s, above 9.1 billion
tons of plastic has been produced globally (Pacheco-Torgal, Khatib, colangelo & Tuladhar,
2018). As per the year 2015, the total production of plastic came to roughly at 448 million
tons within the same year alone. For curbing the use of plastic, there are certain researchers
and environmentalists that have shown their serious concern. There are several states all
around the world that are tackling this issue and the government officials have banned and
limited the use of plastic products including the single use plastic items. According to the
recent reports, only one single use plastic bag is estimated to have a total lifespan of twelve
minutes. For reducing the use of single use plastic products, cites, countries and states all
around the globe has introduced certain laws for banning the use of plastic bags. Plastic
products are very harmful for the environment and most importantly, the taxpayers. There are
numerous regulations that minimised the marine impacts, wind blower litter issues with the
management of waste and many more (Beal et al., 2018).

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Furthermore, it is also to note that as the tide of the public opinion turns against the
disposable plastic bottles, there needs to be some very serious innovation of the industry
hopes of saving the face. The beverage industry in the present days are in the crisis mode.
This tide of public opinions has turned very significantly against the firms that make use of
plastic bottles for juice, soda and water. They today are no longer viewed as the providers of
convenience but instead, as an environmental villains who are responsible for the pollution of
the oceans of the planets. According to Xanthos and Walker (2017), it has been highlighted
that the damaging impact that the single use plastic is having on the oceans, presenting a case
of a pilot whale calf that is thought to be died of consuming the contaminated milk of its
mother, which further was contaminated because of the toxic chemicals present in the plastic.
Hence, these cases influence the mind-set of the stakeholders to a great extent and ultimately
influence the economic, commercial, social and environmental trends on organisation’s
ethical and sustainability behaviours. According to Wilcox, Mallos, Leonard, Rodriguez and
Hardesty (2016), “Sustainability speaks to the heart as it plays on a connection for the
greater good”. Packaging that comes from renewable and reusable materials and resources
are often considered to be more sustainable. There are several hidden benefits of these
recyclable materials that the consumers widely are aware of in the contemporary world.
Being a multinational and a significant company Chatime must adhere to this concern in
order to ensure long term growth and success. It also influence positively its social reputation
and people would more attracted to the business and hence, would increase the company
profitability. For example, in the case of plastic films, there is actually some clever
technologies that are made in use and that enables longer shelf life for the products.
Although, the consumers might feel that the packaging style is bad, it is often less impactful
if it have the potential to minimise the occurrence of products being wasted.

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Identification of three alternative solutions
Tackling the plastic pollution and finding out alternative solutions for plastics is an urgent
priority for human beings in today’s world (Vince & Hardesty, 2017). Therefore, Chatime
needs to take it in extremely serious way. For doing so, Chatime needs to accelerate all its
actions for tackling this plastic waste issue and to make a remarkable difference in every
place where it operates.
a) In place of plastic straws, Chatime can make use of paper, bamboo, stainless steel and
glass straws. They can easily avail them in bulk from most of the ethical online stores.
This idea is used in most of the high street and zero-waste local shops in Australia.
b) The company can also make use of hemp fiber as an alternative along with seaweed
and avocado pits. As per Kershaw (2018), it is an innovative and environmental
friendly alternative for the plastic straws- the seaweed straws. With the same, they are
also hyper compostable and looks and feels like plastic only.
c) Every year more than hundred billions of coffee cups are disposed globally. Not only
the plastic lids of these cups add to the problem but at the same time, the paper cups
themselves are often lined with the plastics as well. Therefore, Chatime should opt for
reusable cups and there are several outlets that would offer the same at discounted
rates. These cups are 100% biodegradable and sustainable. At the same time, there are
ample of high quality porcelain, glass and aluminium flasks and mugs that are
available for most of the travel stores. The same can be done for the use of plastic
fins.
Recommendations
Chatime needs to reduce its plastic footprint and must ensure that its stakeholders are
aware of the same. It should accelerate all its actions for tackling this plastic waste issue and
to make a remarkable difference in every place where it operates. Instead of plastic cups, lids

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and straws, it should make use of these products made from high quality porcelain, glass,
aluminium, paper, bamboo, stainless steel and glass. They are way too eco-friendly and are
100% sustainable and biodegradable. It can also make use of hemp fiber as an alternative
along with seaweed and avocado pits in place of its plastic straws.
Conclusion
Hence, from the above analysis it is to conclude that Chatime, though being a
multinational company and one of the fastest growing franchises in Australia, is facing
certain ethics and sustainability related issue of single-use plastics and its waste in its
business operation. Single use plastic are killing the environment and people today has
become highly conscious about their environment. Therefore, in order to ensure that the
business is practicing ethical and sustainable business functions, it needs to eliminate the use
of plastics by all means.

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Freeman, R. E., Kujala, J., Sachs, S., & Stutz, C. (2017). Stakeholder engagement: practicing
the ideas of stakeholder theory. In Stakeholder engagement: Clinical research
cases(pp. 1-12). Springer, Cham.

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Harrison, J. S., Freeman, R. E., & Abreu, M. C. S. D. (2015). Stakeholder theory as an ethical
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