A2 Milk Company: Strategic & Sustainability Accounting Assessment

This report provides an analysis of the strategic and sustainability accounting practices of the A2 Milk Company, focusing on the environmental and social concerns associated with its operations. The report identifies key environmental issues such as the exploitation of agricultural land, animal welfare, and atmospheric pollution from greenhouse gas emissions, highlighting the role of company management and employees in mitigating these impacts. Social concerns, including the risk of product contamination and workplace accidents, are also addressed, emphasizing the importance of strict policies and adherence to government standards. The report suggests potential environmental and social objectives for the company, along with performance measures to track progress. It concludes that by implementing sustainable practices and prioritizing stakeholder health and safety, A2 Milk Company can enhance its reputation and achieve business growth while addressing its environmental and social responsibilities. Desklib provides students access to similar past papers and solved assignments.

Strategic & Sustainability Accounting

Executive Summary
The a2 Milk Company influences the environment in various ways and there are certain
initiatives that could be taken by the firm to minimize such impacts. The firm also impacts
number of stakeholder groups and there are number of major social concerns that
management must be aware of. Major environmental concerns are the exploitation of
agricultural land and dairy animals, atmospheric pollution due to greenhouse gaseous
emissions. The stakeholder groups associated with environmental concerns are management
and employees of the company. Similarly, social concerns associated with operations of the
company are risk of contamination of products and risk of workplace accidents. It requires
strict policies to be framed by the company and made obligatory for all to adhere to it. The
government standards and norms should also be followed by the company and by all the
stakeholders associated with the company in order to get rid of such environmental and social
concerns. The sustainable practices by the company enhances the reputation of the company
in the market as well contribute a lot in business growth across the world.

Table of Contents
Executive Summary...................................................................................................................2
Introduction................................................................................................................................4
Conclusion..................................................................................................................................7
Bibliography...............................................................................................................................7

Introduction
The a2 Milk Company is a leading milk producer as well as supplier across number of
countries. The company has achieved success in the market because of its unique product i.e.
a2 protein in the milk. However, there are various environmental and social issues as well,
which are associated with its operations and should essentially be taken into consideration
(A2 Corporation Limited, 2012). In its Annual Report of the year 2016-2017, major
environmental and social concerns related to the operations of a2 Milk Company that could
potentially impact the ability of the company to achieve its future objectives are as follows
(A2 Milk Company, 2017);
Environmental Concerns
The environmental concerns associated with the supply of dairy products of company include
water access and usage in agricultural context as well as animal welfare. With the increasing
demand of dairy products, the agricultural activities need to be enhanced as well as milk
production in the animals need to be increased. The adverse ways to enhance the productivity
of land as well as animals are huge environmental concerns associated with the company.
Furthermore, the processing of milk and milk products require refrigerants and air
conditioners to keep products safe from getting contaminated (A2 Corporation, 2008). The
refrigerators and ACs emit green house gases in huge amounts which are harmful for
environment and in turn for society as well. The role of stakeholders associated with these
concerns is the company itself which include employees as well as the management of the
company as it is the duty of the employees and the management to keep the processes under
control so as to prevent any kind of environmental damages due to the processes (Westbrook
& Greenfield, 2018).

Social Concerns
As milk products are perishable, their shelf life is less, and so the products might get
contaminated and becomes unfit and unsafe for sale or consumption. It might lead to
regulatory penalties, termination of distribution agreements, liabilities associated with
adverse health impacts on consumers, disposal costs and product recall, delayed supply and
overall damage to the brand and reputation of the company (Kral, 2017). Another serious
social concern associated with the company operations is any kind of potential harm to the
workers at workplace due to non-compliance with the applicable laws and regulations
(A2Milk Company, 2018). It results in potential financial penalties, reduced morale and
productivity of staff, increased insurance costs and damage to the reputation of the company.
The health and life of the stakeholders should be the topmost priority of the company and
above mentioned social concerns might be unsafe for the health and safety of the consumers
as well as employees working in the company. The matter should be taken into consideration
by the management of the company so that consumers as well as the employees could be
prevented from any kind of physical or financial harm (Dairy Australia, 2017).
The table will suggest three potential environmental as well as social objectives that should
be achieved by the company to achieve progress. For each objective, two possible
performance measures that could be used by the company to measure its progress towards the
objectives will also be suggested.

Dimension Objective Possible Performance Measures
Environmenta
l
1. To comply with the
environmental regulations
enforced by government
a. Compliance audit
b. Environmental certifications
2. Introduction of independently
audited animal welfare
program
a. Evaluation of health status of dairy
animals
b. Increase in milk production
3. To reduce the greenhouse gas
emissions by 10%
a. Carbon footprint reporting by external
auditors (Department for Environment,
Food and Rural Affairs, 2009)
b. Government parameters
Social 1. To adopt fair trade practices a. Supplier satisfaction
b. Employee and customer satisfaction
2. To contribute towards social
welfare
a. Amount spent by organization on social
welfare
b. Number of people benefitted from social
welfare programs
3. To provide employment
opportunities to local people
a. Percentage of local people in workforce
b. Amount of revenue generated by local
businesses owing to company’s
operations

Conclusion
The a2 Company should look into the matter of environmental and social concerns that are
associated with the stakeholders as well as the operations of the company. In order to resolve
environmental issues associated with the operations, strict rules and regulations should be
developed and should be implemented entirely. The influence of adverse practices upon land,
animals and atmosphere might cause serious harm, so sustainable practices should be taken
into consideration. Organic farming should be promoted, diversified pool should be
considered for sufficient availability of milk and environment friendly techniques should be
utilized to keep dairy products contamination free and from becoming unfit and unsafe for
sale and consumption. In a similar manner, government norms and regulations for perishable
products should be followed strictly to protect the consumers. Furthermore, in order to get rid
of unnecessary accidents, it is essential that laws and regulations implemented by the
company as well as the government norms should be followed by the employees working in
the company. Following all these suggestions could most probably resolve environmental and
social concerns discussed in the report.
Bibliography
A2 Corporation. (2008). ANNUAL REPORT 2008.
A2 Corporation Limited. (2012). Annual Report. A2 Corporation Limited.
A2 Milk Company. (2017). Annual Report 2016–2017. A2 Milk Company.
A2Milk Company. (2018). The a2 Milk Company. Retrieved from Thea2milkcompany.com:
https://thea2milkcompany.com/about-us/
Dairy Australia. (2017). Strategic plan 2016/17 to 2018/19. Dairy Australia.
Department for Environment, Food and Rural Affairs. (2009). Guidance on how to measure
and report your greenhouse gas emissions. Department for Environment, Food and
Rural Affairs.

Kral, L. (2017). The Health Battle Behind America's Next Milk Trend . Retrieved from
theatlantic.com: https://www.theatlantic.com/science/archive/2017/01/a-tale-of-two-
milks/514397/
Westbrook, T., & Greenfield, C. (2018). Competition heats up for controversial a2 Milk
Company. Retrieved from Reuters.com: https://www.reuters.com/article/us-a2-milk-
company-strategy-analysis/competition-heats-up-for-controversial-a2-milk-company-
idUSKCN1IH0T9