Report on Tesco Plc: Business Environment, Governance, and Structure

This report provides a comprehensive analysis of Tesco Plc's business environment, governance, and structure. It begins with an overview of Tesco Plc, detailing its retail operations, banking, and insurance services, and its hierarchical organizational structure. The report then examines the company's governance, including the role of the board of directors and the importance of corporate governance principles. A significant portion of the report is dedicated to stakeholder analysis, differentiating between internal and external stakeholders and exploring the relationship between the board of directors and stakeholders. The report also addresses corporate social responsibility (CSR) initiatives undertaken by Tesco Plc. Furthermore, the report employs a PESTLE analysis to assess the impact of political, economic, social, and technological factors on Tesco Plc's business operations, providing insights into the challenges and opportunities faced by the company in its operating environment. The report concludes by summarizing the key findings and implications of the analysis.

Tesco Plc (Business
Environment)

Table of Contents
INTRODUCTION ..........................................................................................................................3
1. Examine how Tesco Plc is governed and structured...............................................................3
2. Analysing the effects of external environmental factors on Tesco Plc...................................5
CONCLUSION ...............................................................................................................................9
REFERENCES .............................................................................................................................10

INTRODUCTION
Business environment is sum total of all external or internal factor that affect business
functional activities in terms of positive and negative manner. Business environment factors
affect each other and work together to affect business function. Present study will be based on
business environment for which Tesco Plc will be taking into action. Further, study will be going
to cover the best that how company governed and structured their business activities. Overall,
report based on to identify the Tesco Plc marketing environment by using pestle model.
1. Examine how Tesco Plc is governed and structured.
(A) Overview of company
Tesco Plc (Tesco) in a retail sector, the company is engaged in the business of retailing
along with other two services as well which is banking and insurance services. Besides, company
includes some segments like UK & ROI which influence two bodies UK and Republic of
Ireland. Tesco Plc deals in retail banking and insurance services by Tesco bank in UK.
Tesco Plc is the committed company to its shareholder value through focussing on
customer meeting (Acha, Du and Shah, 2016). Tesco Plc managed their business at national level
by following some essential principles such as value of money, customer loyalty, product
quality.
History of Tesco Plc
Tesco Plc holds the leading position in the market of Britain or in the retail sector with
market share of 15%. In England, Scotland and Wales company has 588 supermarkets, 257 of
them are superstores which sells food products along with some other variety of products as well
such as clothing, housewares, petrol and alcoholic beverages (Tesco Plc, Company profile,
information, business description on Tesco Plc, 2018). Tesco Plc provides personal finance
which includes grocery budgeting account which is called Clubcard Pluc, Tesco visa card and a
Tesco saving account.
Tesco Plc follows the hierarchical organisation structure in which they delegate the roles
and responsibilities to the employees as per their skills and education level. Besides, it three level
top middle and lower level (Anemogiannis and et.al., 2014). Tesco Plc business structure is
constructed by five committees reporting to Tesco Plc board, out of which 11 people of Tesco
executives has been led by group of Chief executive which name is Dave Lewis.

(B) Brief discussion of how company is governed
Tesco Plc consists 10 Boards of director which is very much significant for the company.
The code of Tesco Plc is to conduct the business activities more suitable and long lasting. Tesco
Plc understand the needs of rules that must followed by the company structure. Whether you are
new to Tesco or have worked for the business. Tesco Plc believes in values and overall
structured manner of forming goals (Banda, 2018). It brings new form of results and taken new
opportunity growth. Tesco governed hierarchical structure which follows top level, middle or
lower level of structure. Besides, John Allan is the non-executive who is appointed on 1 march
2015. On the other hand, Tesco Plc has 8 number of non-executive directors which governed the
company structure (Bayer and et.al., 2018).
Corporate governance includes the roles and responsibilities of corporate governance.
The board is the custodian of the company value. There are certain matters which are deemed
significant enough to be reserved for only board making decisions.
Stakeholder
Stakeholders are the number individuals that has an interest in company activities.
Stakeholder either affect or be affected by the activities of the company. There are two types of
stakeholders within organisation environment external stakeholders or internal stakeholders.
Primary stakeholder are investors, suppliers, customers and employees who directly
impact on the business (Bilbao-Terol and et.al., 2018). On the other hand, External stakeholders
are little difficult to understand the who does not directly impact on the business activities. For
example government they might be affect company or not be sometimes. It only takes action
against organisation when they fail to adopt proper ethical structure to run the business activities.
Apart from that, it brings the new managing structural growth in order to meet the out the goals
and managing successful business (Jones and Livingstone, 2018).
Relationship between board of directors and the stakeholder
Relationship between directors and stakeholder are just like the relationship between
employee and his or manager. Thus, the company decision taken by the shareholders for
managing the good terms with stakeholders. It brings new opportunity and growth for the
company development process which required to make better decision making approach. Tesco
Plc should have maintained positive relation with stakeholder and shareholders by introducing
some formal informal sessions (Kew and Stredwick, 2017). Company directors needs to think

innovative strategies to meet out the needs of potential stakeholders. It also represents the new
forming results and managing performing results and goals. Which is very much necessary for
the to accomplish into more effective manner. On the apart stakeholder are usually involved with
the decision making process of organisation which can be collected through good personal
relations (Rahman, 2016). Process of communication must be more formal from shareholders to
stakeholders. It is necessary to being protective and more challenging for the development of
managing successful business growth in order to meet out the challenging material growth.
Overall, positive and negative relationship between stakeholder and shareholders will help to
introduce new opportunity and growth interns of meeting new objectives for the company
development (Zissis, Aktas and Bourlakis, 2017).
Shareholder are always eager to know about the company profit making in order to be
confident and motivated to get high rate of return on their investment. They always take their
profit ratio from the profit of company. On the other hand, stakeholders are always eager to
know about the innovative product or services launching by company so that their desire become
fulfilled. Stakeholders have concern related to product quality, services or the some expectations
for what they actually deserve (Bayer and et.al., 2018).
On the other hand, suppliers wish that when they get the good amount from the company
either when they get more orders by the company as well.
Corporate social responsibility
Being in retail sector Tesco Plc applies different CSR regulations and growth in order to
meet out the needs and goals. It helps to make good impact or results of managing low
performing tasks and influencing long term effects on the business environment (Jones and
Livingstone, 2018). To keep maintained good impact on customers, company requires adopting
human rights and labour standards, environment protection steps such as reduced absolute
carbon emissions by 3.1% year on year. To keep maintained suppliers relationship, business
ethics and anti bribery.
2. Analysing the effects of external environmental factors on Tesco Plc
Tesco Plc is the sub brand of Tesco which is not only providing retail products but also
dealing in broadband, mobile networks and insurance services (Kew and Stredwick, 2017).
PESTLE analysis

Political : Political factors of external environment might be get affect the company
business operations which is comparatively low effective for the growth. Tesco Plc operating its
business across 12 countries including with Europe and Asia (Zissis, Aktas and Bourlakis, 2017).
Operate businesses across different countries is very challenging task for the company which
needs to adopt all regulations and also needs to follow Tax rates, current and government
regulations, political instability, unemployment rate, economic condition of the countries where
it is operating. Apart from that, it discovers the new managing successful business growth. For
example, import duty on goods can affect Tesco because it imports in some countries are very
low and ineffective through which company taken negative impact on the business function.
Those tax which consist on the large market which is known as Tesco Tax was directly proposed
by the local council but UK government refused the initiative mainly to neglect the high prices of
tax rates (Rahman, 2016). Apart from that, it also affects the business goals which gives low
making results on the business environment. Due to sudden changes in the government
regulations affect the company in future times.
Economic factors
The best example of economic factor is Labour cost that might be affect UK supermarket.
In 2018 minimum wage rate is increased by 4.4% for 25 years old onwards. This upward shift
has cost Tesco millions of pounds in UK. Apart from that, economic factors affect business by
many economic factors which holds by government. In recent days Tesco Plc effect many of the
economic factors such as cost, prices and profits (Bayer and et.al., 2018). For that, company
needs requires borrowing cost in UK. Diversification and presence in international market are the
two important strategies in past years and the reason for the success growth. Tesco Plc is totally
depends on the UK market. High rate growth or changes in the market will affect the
international market. Due to high cost or princess company reduces their profit margin growth.
Apart from that, it gives positive result outcomes to get the best business research or process
goals (Bayer and et.al., 2018). Overall, it brings new managing changes as per the changes'
environment of economic environment.
Diversification and presence in international market are the two strategies in past and
reasons which is most fruitful for the company success. This is the reason that, UK depends on
the UK market with a 27.7% in the UK grocery market (Banda, 2018).
Social factors

Consumers shopping trends or their lifestyle are always uncertain and challenging for
businesses. Consumers are always looking for good pricing policies with some good quality of
products. It helps to give the new managing and growth full challenging task to give the
managing growth (Banda, 2018). Tesco Plc deals with banking and insurance, for that company
needs to have some new and effective policies that attract attention level of buyers. On the other
hand, they also need to require researching the market in order to identify some new needs and
wants of the customers. More apart it gives new opportunity and growth by measuring the
customer wants and effective potential needs of them. Social factors affect company if
organisation fails to full fill the satisfaction level of customers or either not full fill the corporate
social responsibility. These social cause factors might be given the new measurable outcome
results in order to meet out the goals and result outcomes.
Obesity is the another issue of society or consumers which relates to the health. Tesco
must be considered the social changes and consumer behaviour by offering them the best
insurance or banking services (Banda, 2018). Company needs to launch some new offers and
managing successful decision making approach to get the good outcome results. According to
PWC reports 65% UK shoppers are loyal shoppers. This be the opportunity for Tesco Plc to
make a strong bond between customers and employees. The demand for insurance and banking
services are depends upon the rate of uncertainty. To reduce the level of risk factor, Tesco Plc
needs to launch some new policies to make the best approachable results and growth. In order to
meet out the customer needs and wants company needs to understand their values and beliefs
before planning some new other policies (Banda, 2018).
Social factors are also influenced by rate of immigration or emigration which affect
directly to the company functions. According to the latest statistical data, in the ending of 2018
March net migration to the UK was 271,000 (Net Migration Statistics, 2018). This can be the
another changing factor of social environment. Moreover, it brings new managing successful
results and managing task which needs to be cooperative by the company.
Technological factor
In few years ago Tesco faced issues or challenges due to fails the satisfaction level of
customers. It becomes the new managing challenge that company needs to handle and making
the best outcome strategies (Bayer and et.al., 2018). Tesco embrace advancement in
technological as opportunity to upgrade their policies and new advancement strategies to make

customer more happy and satisfied. Moreover, it takes new managing successful growth which
amongst the most important source (Bilbao-Terol and et.al., 2018). Technological factor
provides different opportunities for the company through which they can easily meet out the
potential needs of buyers. Moreover, it brings new managing successful growth in order to form
the best output results. Tesco Plc offer online banking services or insurance policies. Apart from
that, it gives the new managing successful growth in order to meet out the current needs of the
company organisation. Apart from that, technological development is the continuous process
which generates long term growth in order to meet out the company organisation process. Tesco
also has been launched another system payment mode for their customers which is called
PayQwid (Bilbao-Terol and et.al., 2018). Apart from that, Tesco Plc also launched their own
mobile application option for the buyers. Overall, it brings new managing successful leading
material in order to conduct the best resourceful material goals. Technological moreover, it
brings new managing task full and new managing. For those who love convenience shopping
they introduced new managing and long term growth (Clothier and et.al., 2014). For those and
long lasting materialistic growth will help to full fill the managing target performance.
Legal factor
Legal factor is the high influencing external factor which directly impact on the business
activities. Due to changes in laws and government regulations this directly impact on the
company policies and structure. Overall, Tesco Plc needs to focused on the changing
environment which occurred different new services and growth. In 2016 Tesco has been faced
legal action taken by their employees on the behalf of discrimination on the basis of age, gender.
Workers are extremely demotivated after facing discrimination within working environment.
So in this form of manner company facing high legal pressure and low image in the
market. Tesco needs to manage their management and conduct good atmosphere with the
workers in order to satisfy their needs and wants (Jones and Livingstone, 2018).
Environmental factor
Different number of company or businesses has facing the negative pressure from
government agencies to address all environment friendly issues and implicate some ozone-
friendly environment as well (Bayer and et.al., 2018). Moreover, it brings new managing
successful growth to take up the new action plan and new managing resourceful goals. In order
to reduced the government interference, Tesco requires to less harmful products and contribute in

green supply chain management. It gives better image and responses to the better customer
loyalty.
CONCLUSION
On the basis of above section it has been concluded that, business environment has been
the most essential part or element for the business success. It provides strength and weaknesses
and also creates new opportunity for the new development goals. Moreover, present study has
been presented the overview of Tesco Plc and discussed the relationship between stakeholders or
shareholders within the business. Apart from that, report also covered the analysation of external
environment with the help of PESTLE model of analysis. Study also discussed about the
corporate social responsibility taken by the company. However, study based on Tesco business
environment which has been concluded both positive and negative results.

REFERENCES
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online :
Tesco Plc, Company profile, information, business description on Tesco Plc. 2018. [Online].
Available through :<https://www.referenceforbusiness.com/history2/11/Tesco-PLC.html>.
Net Migration Statistics. 2018. [Online]. Available
through :<https://www.migrationwatchuk.org/statistics-net-migration-statistics>.