MBA402: Governance, Ethics, Sustainability Assessment Report

This sustainability report assesses Timberwell Constructions, an Australian construction company, using the GRI reporting framework. It addresses economic sustainability (financial risks due to climate change, corruption incidents, anti-competitive practices), environmental sustainability (energy consumption, biodiversity impact, regulatory compliance), and social sustainability (employee turnover, discrimination, community engagement). The report details the company's challenges, mitigation measures, and management approaches to these issues, including the implementation of an Ethics Committee and an Environment Compliance Officer. It also covers legal and regulatory compliance requirements within the Australian context.

GOVERNANCE ETHICS AND SUSTAINABILITY
GOVERNANCE ETHICS AND SUSTAINABILITY
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Executive summary
This sustainability report for Timberwell Constructions, an Australian construction company
operating Sandwell District. The report covers issues of economic, environmental and social
sustainability, utilising the GRI reporting framework, the material topics covered in the report all
listed below as well as identifying sustainability challenges and highlighting the mitigation
measures that the company initiated, the report discusses management approaches to the
challenges.

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Table of Contents
Introduction......................................................................................................................................4
A. Economic Sustainability.............................................................................................................4
i) Disclosure 201-2 Financial implications and other risks and opportunities due to climate
change..........................................................................................................................................5
ii) Disclosure 205-3 Confirmed incidents of corruption and actions taken.................................5
iii) Disclosure 206-1 Legal actions for anti-competitive behaviour, anti-trust, and monopoly
practices.......................................................................................................................................6
iv) Management approach to economic sustainability challenges..............................................6
i) Disclosure 302-1 Energy consumption within the organisation..............................................8
ii) Disclosure 304-2 Significant impacts of activities, products, and services on biodiversity...8
iii) Disclosure 307-1 Non-compliance with environmental laws and regulations......................8
iv) Management approach to environmental sustainability challenges.......................................9
C. Social sustainability....................................................................................................................9
i) Disclosure 401-1 New employee hires and employee turnover.............................................10
ii) Disclosure 406-1 Incidents of discrimination and corrective actions taken.........................10
iii) Disclosure 413-1 Operations with local community engagement, impact assessments, and
development programs...............................................................................................................11
iv) Management approach to social sustainability challenges...................................................12
Conclusion.....................................................................................................................................12
Reference.......................................................................................................................................13

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Introduction
Timber well Constructions is a renowned construction company that operates in Stanwell
Council District of Australia. The company is identified as a SME with 58 employees associated
with different construction projects and profession. This sustainability report uses the Global
Reporting Initiative (GRI) reporting framework. It also. Identifies recent sustainability
challenges encountered by the firm and mentions any relevant government regulations and legal
framework. Moreover, report identifies some of actions to mitigate some of the resulting
outcomes.
The purpose of implementing the GRI framework is to make an understanding and
highlighting the critical sustainability issues in terms of climate change, social well-being and
ethical violations. Moreover, creating social, environmental and economic benefits for everyone
is also a focal point of the GRI framework. Therefore, ensuring their sustainability and future
market orientations the companies intends to incorporate the GRI framework in their
sustainability report.
A. Economic Sustainability
According to Carney (2015) it can be argued that climate change and threats are
considered to be one of the major problems that escalates financial costs of a business
organisation. It can be stated that most of the people think that the big organisations are not
affected by the climate change mechanisms but in reality, there are huge amount of adverse
impact on the organisation regarding installing environmental sustainability measures. In his
study Dietz et al. (2016) opined that the financial assets are treated as liability and rely on high

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risk value because the organisations do not get any profit from these investments. As a matter of
fact, may be the environmental infrastructure helps the organisations to get more sustainable
holding in the market, but that market capitalisation can be achieved through different techniques
also. Hankinson and Surminski (2018) rightly advocated that the environmental sustainability
measures are identified ethically right but in terms of the business perspectives where profit is
considered to be the ultimate motive of the organisation investing on sustainable measures don
not give them any strategic advantage. In fact, it is more like a one-sided initiative where the
company could not get any profit from these measures.
i) Disclosure 201-2 Financial implications and other risks and opportunities due to
climate change
It can be seen in case of the Timberwell Constructions as well. As per the Stanwell council
proposed Local Environmental Plan (LEP) therefore it costs huge amount of money for
Timberwell Constructions to comply with. Moreover, the Timberwell Constructions Company
witnesses a cost of $4 million for developing better sustainability framework as per Stanwell
Council proposal. It is also important for the Timberwell Constructions is asked to develop such
measures within 6 months that is relied on the sustainability framework in terms of higher
standards for bushfire safety measures. It creates huge financial risks due to the changes in the
climate.
ii) Disclosure 205-3 Confirmed incidents of corruption and actions taken
Australian Competition and Consumer Commission (ACCC) deals with the anti-competition
behaviour in the business organisations. Section 45 of the Competition and Consumer Act
prohibits all kind of measures that create obstacle to the free and open market competition
(accc.gov.au 2018). No such monopoly or business cartel will be entertained in Australian that

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can perturb the very existence of open and healthy market competition. As a matter of fact, as
envisioned by the Australian government, practices like price fixing, restricting outputs or
allocate customers, suppliers and territories are against the law.
In case of the Timberwell Constructions, the company was alleged with corruption and
bribery. The complaint against Timberwell Constructions was that five of its employees and two
of its partners were connected with a public corruption scandal. They offered bribes to council
project officers in order to get more contracts and to help push through development
applications. After a thorough investigation Timberwell Constructions suspended all the five
employees without any payment and for further legal steps the company also terminated
partnership with two external partners.
iii) Disclosure 206-1 Legal actions for anti-competitive behaviour, anti-trust, and
monopoly practices
In addition to this, the Company was also alleged with possessing monopolistic mentality by
threatening suppliers and contractors if they involved with any business relation with other
companies then Timberwell Constructions would compel to terminate all business connections
with those suppliers.
iv) Management approach to economic sustainability challenges
In this context, the management will formulate a measure in terms of taking necessary
steps towards sustainability so that no fines would be levied on the organisation An Ethics
Committee can be implemented with the purpose to deal with all the sustainability issues of
Timberwell Constructions. Furthermore, asking the Senior Financial Officer to audit the
expenses in the sustainability measures.

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B. Environmental sustainability
With the growing demand of the customer it becomes an important aspect to retain the
environmental sustainability across the world. As the business organisations are highly
responsible for the environmental damage therefore it becomes important for them to take more
responsibility in this regard. Moreover, the environmental sustainability also helps the
organisations to maximise the customers by developing the brand image. Henceforth, it can be
stated that environmental orientation is considered to be one of the important aspect on which the
Australian business organisation must rely upon to fetch all the permissions and benefits in the
context of the business market.
Private business organisations has adverse impact on the environmental sustainability to a
great extent. It can be stated that the global loss of ecology and biodiversity is not done by the
lack of perception regarding the importance of saving the world by an individual but also the
deliberate approach of the organisation can also deliver great impression on the damage of
environmental diversity. According to Joly et al. (2015) over the last 50 years the private
business organisations severely affect the environmental sustainability and it becomes an
increasing trend where the organisations either perceive any understanding regarding the
significance of ecological sustainability or they put more emphasis on the means of profit than
ecological balances. On the other hand, Maron et al. (2015) argued that there are a number of
government activities and policies prevalent in Australia that are committed to safeguard the
environment and its diverse flora and fauna.

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i) Disclosure 302-1 Energy consumption within the organisation
Energy consumption is considered to be one of the major aspects on which every companies
must put emphasis. In this context, Timberwell constructions puts more emphasis on the total
fuel consumptions. As per the new media release of the company, it can be asserted that
Timberwell Constructions will reduce its fuel consumptions up to 50% within the next 50 years.
ii) Disclosure 304-2 Significant impacts of activities, products, and services on
biodiversity
Timberwell Constructions, the company was [3071] alleged to clear area of 0.45 acres
that was recognised under the State Planning Scheme of Australia and contained important flora
and fauna attributes. This was a clear case of breaching the environmental protection regulations
and was fined $200,000. In response to this, the responsible government agency ordered
Timberwell Constructions to implement measures of the vegetation management plan with
different audit program for the contractors. In this context, a rehabilitation program was also
ordered to follow with a cost of minimum $440,000. Due to lack of measures and concerns
undertook by Timberwell Constructions the company had to pay huge amount of fines as a
damage to the ecological balances.
iii) Disclosure 307-1 Non-compliance with environmental laws and regulations
As per the government regulation of the Australian government encompasses an
extensive framework with the purpose to safeguard the ecological diversity and the
environmental balances. Energy consumptions and procure a better framework for the next
generation is also considered to be important in the context of the Australian government
regulatory framework. In this context, the Australian government tries to restrict the business

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activities of the corporate organisations in order to make it more associated with the environment
(Austrade.gov.au 2018). The federal, state and the local government are the respective administer
to enforce better environmental protection acts. Therefore, it is highly important for the business
organisations to follow the Environment Protect and Biodiversity Conservation (EPBC) Act as
they are compelled to abide the government legislation (Business.gov.au 2018). The Department
of Environment and Energy is the paramount department that generates the license for doing
business in Australia.
iv) Management approach to environmental sustainability challenges
Taking measure such as using tools of less energy consumptions and lack of
environmental hazards. Moreover, it is important to imply some eco-friendly policies and
encouraging the employees for maintaining environmental sustainability. Furthermore, it can be
a strategic measure to appoint an Environment Compliance Officer. The role of this officer will
be monitoring the environmental policies of the Timberwell Company and make necessary
decisions to ensure environmental sustainability.
C. Social sustainability
Social Sustainability is related to the organisational orientation in order to establish better
relationship with the local community. As a result of that it will deliver more strategic market
capitalisation for the company as well as encapsulate more customer in the process. Therefore,
the social responsibility is environmentally a benevolent practice and at the same time it helps to
establish a firm business orientation for the organisations.
Through his research Baldus, Voorhees and Calantone (2015) showed that community
engagement in business is a pivotal practice that provided the company a strategy advantage in

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the competitive market. The strategic advantage can be referred as increasing brand value,
making better image in the market and maximising the customers to a great extent. Therefore,
according to Habibi, Laroche and Richard (2014) the community engagement is considered to be
a sustainability measures on which each and every companies must rely.
i) Disclosure 401-1 New employee hires and employee turnover
In this context, the Fair Work Ombudsman helps the employees to get the minimum
workplace entitlements, transparent payments and other regulatory obligations. In addition to
this, discrimination in workplace cannot be tolerated. There is the Australian Human Rights
Commission Act of 1986 that is contributed to safeguard the employees in case of any
discriminatory act is practiced inside the organisation (fairwork.gov.au 2018). This can be
treated as the retention policy and combatting with the issues of unemployment. Besides this, the
legislative framework also incorporates some provisions regarding the hiring and recruitment
process in the organisation. The Equal Opportunity Act of 2010 and the Federal anti-
discrimination laws are responsible to bring more efficiency and transparency in the course of
the hiring and recruitment process (Humanrights.gov.au 2018). The business organisations are
compelled to maintain all these legislative measures.
In this context, some measures are taken into considerations such as the quality of staff,
raising the salary of the employees and the roistering day off. The primary purpose of the
organisation is to create such workplace environment that is free from any kind of exploitation.
ii) Disclosure 406-1 Incidents of discrimination and corrective actions taken
In the context of Timberwell Constructions, one of the former employees Dennis
McCabe lodged a case against the organisation claiming that his co-workers bullied him because

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of his old age. Most of the staff that the company employed were of an age between 30 and 50.
Therefore, an age gap was created between Dennis and the rest of the employees. Dennis
complained that there was no healthy workplace environment in the organisation because due to
his age he was bullied by his colleagues. A target of humiliating age related jokes made him
feeling low and not satisfied do job in Timberwell Constructions. The company management was
also reluctant about that and did not take any initiative to make a better and healthy workplace
culture.
Fair Work Commission upheld Dennis‘s claim. As a result of the Fairwork ruling,
Timberwell Constructions has paid Dennis McCabe $4,400 in compensation. The company is
conducting an antidiscrimination training program for all employees.
iii) Disclosure 413-1 Operations with local community engagement, impact
assessments, and development programs
In this context, the role of the business organisations are implementing measures in both
traditional and technological means. The traditional measures are related to the hording, flyers
and social campaign programs where as the technological means are associated with the social
media strategies. In other words Zhang et al. (2017) opined that there are direct and indirect
means of community engagement that are significant in the context of strategic advantage of the
organisation. As per the report provided by Zhang, Measham and Moffat (2018) it can be stated
that the social media can be identified as an important tool to make a bridge between the
customers and the business organisation. As a matter of fact, the role of the organisations is to
influence the target customers to a great extent so that they will influenced to buy products of the
company. Therefore, the community engagement process is defined as a sustainability measure
that the organisations must put focus extensively.

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In this context, the Timberwell Company puts emphasis on the public relations campaign
to demonstrate a better understanding regarding the good corporate citizen framework.
Moreover, the company takes initiatives in the company’s Otford Park development site
populated with rare wallum sedge frog.
iv) Management approach to social sustainability challenges
Introducing anti-discriminatory policies and provide training in this context will be
considered to be effective measures for the management. Moreover, ensuring workplace rights is
also an important aspect for the management to follow. A Social Media Officer can be appointed
in order to make a better social sustainability approach. In this context, the role of the social
media officer will be to make public relations and promote the good image of the organisation.
Conclusion
The following report tries to argue about the Sustainability report of Timberwell
Construction. The report clearly includes the economic, environmental and social sustainability
factors based on the GRI framework for a better understanding of the relevant issues and the
exploring the possible mitigating policies. Therefore, it can be concluded that all the above
mentioned strategies will be implemented by the Timberwell Construction and the effectiveness
of the policies will be described in the next sustainability report. From that point of view, it is
essential and imperative for Timberwell Constructions to maintain a good sustainable
mechanism for its future business orientation.

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Reference
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