Contemporary Management Issues at TESCO: A Leadership Perspective

This report provides an in-depth analysis of the contemporary management and leadership challenges faced by TESCO, a leading retail brand. It examines the company's performance in the context of Corporate Social Responsibility (CSR) and sustainability, highlighting key issues such as the 2014 accounting scandal and the effectiveness of its sustainability initiatives. The report critically assesses TESCO's approach to ethical business practices, its impact on stakeholders, and its contribution to environmental sustainability. It explores the influence of these management issues on TESCO's current and future performance, considering the implications for brand image, financial outcomes, and long-term growth. The report concludes with recommendations for addressing these challenges, emphasizing the importance of leadership development, technological innovation, and stricter internal policies. The report aims to provide a comprehensive overview of the leadership and management landscape at TESCO, offering valuable insights for industry professionals and students alike.

Issues in business
management
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Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Contemporary issues in leadership and management at TESCO...........................................3
Influence of contemporary management issues on current and future performance of TESCO
................................................................................................................................................5
Recommendation to face contemporary management issues.................................................7
CONCLUSION................................................................................................................................9
REFRENCES.................................................................................................................................10
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INTRODUCTION
Businesses face various challenges in the current age which includes constant changes in
the external environment and ethical challenges along with the threat of climate change. The
concept of sustainability arises from the threat of climate change affecting the planet and human
life. In addition to this corporate social responsibility of the company to give back to society and
work ethically also has challenges in the contemporary business world which is complicated
because of globalization and technological advancement (Dinnen and Alder, 2017). It is
important to understand and solve leadership and management challenges in the current world
because it helps ensure that the firm is able to achieve success in a ethical manner. This report is
based on one of the retail leaders of United Kingdom TESCO. It is an internationally successful
retail brand founded in 1919. This report is directed to CEO of TESCO and analyses
contemporary management and leadership issues in context of CSR and sustainability at TESCO.
MAIN BODY
Contemporary issues in leadership and management at TESCO
Corporate Social Responsibility
The main purpose of corporate social responsibility is to ensure that the concept of economic
progress, social justice and Environmental Protection are considered in strategy formulation of a
firm. Corporate social responsibility focuses on regulating business activities on its own to
ensure that economic development and technological progress of the company benefits all,
including suppliers, consumers, employees, local communities, and other stakeholders associated
with the company (Kang and Jang, 2019). In short, the focus of corporate social responsibility is
to move the growth agenda of her business from solely focusing on profitability to ensuring that
profitability benefits all instead of the sole shareholders and investors of the firm.
In the current age, there are various leadership as well as management challenges which
affect compliance with corporate social responsibility to ensure that business activities are
carried out in an ethical manner benefiting the whole society and minimizing harm on the planet.
The inability of Tesco to follow through corporate social responsibility and regulate its business
activities to ensure that economic progress supports benefit to all stakeholders can be clearly
seen by understanding the recent settlement of 2014 accounting scandal.
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The recent settlement of the accounting scandal of Tesco, the company had to pay
193,000,000 pounds in order to finish the case. In the year 2014, Tesco had incorrectly booked
supplier income by £250 million, although the error reportedly grew to £326 million (Tesco
hands out £193m to settle 2014 accounting scandal, 2021). This huge error in financial reporting
by Tesco showcases that the company is not serious about ethical concerns and complying with
corporate social responsibility standards to ensure that it upholds interests of all stakeholders.
This accounting scandal highlights the leadership and management issue at their school.
The company is unable to ensure compliance with policies and practices related to
financial reporting so that accurate numbers can be communicated to various stakeholders. This
type of disregard towards effective financial reporting affects corporate social responsibility of
the company as it leads to corruption and mismanagement of financial resources which impacts
each stakeholder associated with the organization. It is important for leaders in management at
Tesco to ensure that this step of mistakes and irregularities are eliminated when it comes to
financial reporting and management of financial resources. This is because it can help the
company effectively utilize its financial resources to achieve corporate social responsibility
objectives and support betterment of society and the environment.
Sustainability
This is an important contemporary management and leadership issue because attaining
sustainability objectives such as reaching net zero carbon emissions and reducing the usage of
plastic in the company can only be attained with the help of effective leadership and
management (Kang and Sung, 2019). Then retail industry has made huge contributions to
climate change and negative environmental impact. Multinational retail firms employ large
distribution channels to purchase and supply their products, which are most of one produced in
low income countries. There can be possibility of employment of slave labor or negative
environmental impact caused by. Production of goods using resources from protected natural
areas. In addition to this, the transportation of goods across international borders also results in
pollution, which harms the environment. It is important that multinational retail firms such as tax
code take into account sustainability issues in order to ensure that their form does not have
negative impact on the planet and minimizes its contribution in climate change.
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TESCO has launched a £400 million bond linked to reducing its greenhouse gas emissions by 60
per cent by 2025 (TESCO UNDER FIRE FOR ‘LAZY’ SUSTAINABILITY PLEDGE, 2021). This
initiative by Tesco may seem as a positive step towards reducing climate damage and becoming
more responsible towards contemporary sustainability issues. However, close inspection of this
sustainability objectives showcases that it is an unambitious aim when it comes to improving
sustainability of the retail industry, which will not have significant impact on the current carbon
emissions of Tesco, as well as improvements to be made in case of sustainable production and
supply of retail goods. This bond does not include emission from suppliers, which is categorized
and as a scope 3 emission and forms most of the carbon footprint of Tesco. This showcases that
this initiative to improve sustainability of the organization is not sincere in its attempt to
minimize environmental damage and take responsibility for current environmental harm.
This showcases the lack of interest of leaders and managers to handle current
sustainability issues faced by the retail industry. It is important that the leadership and
management at Tesco takes into account sustainability issues faced at different points of its
supply chain so that effective action can be taken to reduce environmental damage without
causing harm to its profitability. The unambitious and even ineffective measures taken by Tesco
to showcase an image of a sustainable retail brand are disingenuous to its stakeholders,
community members and consumers want to purchase responsibility. Improvements need to be
made by the leadership at Tesco. To train and develop employees who are committed towards
sustainability. This will help create programmers which not only a have significant impact on
sustainable operations of the company, but also resulted industry wide collaborations which
improve the sustainability of the retail industry as a whole.
Influence of contemporary management issues on current and future performance of TESCO
Ineffective measures taken by Tesco towards corporate social responsibility result in scandals
such as the accounting scandal. This negatively influences the brand image of Tesco, which can
be seen in the case of accounting scandals as the company had to pay a huge sum of money to
settle the accounting scandal lawsuit. The positive impact of corporate social responsibility
business is, is that it helps enhance their brand image and reputation so that they are able to
attract more consumers and appeal to larger audience (Kashif and et. al., 2017). On the other
hand, the negative impact of corporate social responsibility can be reduction in profitability as
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some amount of profits go towards corporate social responsibility initiatives helping
communities and environment.
In context of the accounting scandal at Tesco, the company has faced negative consequences
because of its inability to follow corporate social responsibility and regulate its policies. Tesco
has faced financial consequences, including their large amount of money, which was paid to
settle the lawsuit, along with two billion loss in valuation. In addition to this reputation, damage
and stakeholder lawsuits against the company regarding its inaccurate financial reporting will
also affect future legal cases against the company. This is because it has been revealed that the
company is not capable of providing accurate financial information which will affect the
perception of various government agencies in context of Tesco, and can lead to legal trouble in
future.
In addition to this, another negative impact of ineffective leadership and management towards
corporate social responsibility and financial management is that the company is also negatively
harming the environment and planet which is the reason for its current growth and success across
the globe (Khandelwal, 2021). Corporate social responsibility combines economic progress,
social justice, as well as Environmental Protection in order to ensure that planet keeps on
prospering including environmental preservation and social growth. In this way, the insincere
attempt of Tesco to comply with corporate social responsibility practices not only harms its
current financial performance and brand image, but also negatively impacts its future growth
prospects as damage to the planet limits the ability of TESCO to grow.
Sustainability is considered an important management issue because leaders and managers are
able to lower carbon emission and impact of the company while maintaining profitability and
reducing costs because of sustainability. The positive impact of improving sustainability on an
organization is that it helps the farm. Lower inefficiencies and improve profitability by reducing
energy and time wastage. On the other hand, the only possible negative impact of investing in
sustainability initiatives is that it may or may not have positive results over the environmental
impact of the overall industry. The lack of guarantee, along with huge investment and time
investment, needed to be made in order to accomplish serious sustainability objectives is a
negative aspect of focusing on sustainability (Naim and Lenka, 2017).
In context of this Tesco, the lazy attempt towards improving sustainability of the organization
without considering one of the biggest factors which leads to its carbon impact, which are its
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supplier emissions affects the company negatively. This is because it does not lead to ground
level impact and can also reduce positive brand image of the company. Unsuccessful attempts
towards improving sustainability of the organization also showcase the ineffective nature of
leadership and management at the company as it is essential that management in readership are
involved in sustainability initiatives of the organization. Finally, another negative impact of
ineffective attempts made by Tesco towards improving its sustainability is that it does not lead to
a green future and can affect the future growth of the company.
In the current age, businesses, consumers and governments alike are looking towards creating a
more green and sustainable future (Santhanam and et. al., 2017). This means that businesses who
do not quickly adapt their practices to accommodate for sustainability issues may face serious
challenges in the future. This can not only reduce its profitability, but also lead to complete
failure and dissolution of the company. In context of the TESCO its inability to enhance
sustainability of the organization may lead to failure in the future, as other businesses,
governments and consumers move towards green future, while Tesco is unable to check on its
environmental impact.
Recommendation to face contemporary management issues
 It is recommended that Tesco trains its leaders and managers towards developing a more
sustainable mindset so that the company is able to effectively implement ambitious
sustainability initiatives. This is a suitable recommendation because it will create a drive
towards improving sustainability from top level so that every aspect of the organisation is
devoted towards working on sustainability. Leaders and managers of a company play an
important role in inspiring lower management employees towards adopting specific work
ethic, such as sustainability.
 It is recommended that the respective company invests in improving technological
infrastructure so that new technology can help the organization improve its corporate social
responsibility impact and help preserve the environment. Latest technology, such as artificial
intelligence and virtual reality can be used by businesses to lower their energy consumption
and ensure that every point in their supply chain becomes more sustainable (Wright, 2017).
 It is recommended that company implements more strict policies and company regulations
so that employees are not able to make serious mistakes in managing financial resources of
the company and developing accounting reports. In addition to this, Tesco also needs to
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develop a more strict corporate social responsibility practices so that each employee
contributes towards improving sustainability and social impact of the form, while also
focusing on achieving economic progress.
 TESCO can also utilize artificial intelligence and big data to ensure that its employees are
being monitored and their data is checked by AI to ensure mistakes are not made in case of
financial reporting and other type of data which may be important for external stakeholders
such as communities, government, legal agencies and investors. Artificial intelligence and
big data are useful combination of technology which helps businesses effectively monitor
different kinds of activities happening in the country so that mistakes are not made which
can lead to serious lawsuits against the firm.
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CONCLUSION
From the above report, previous concluded that sustainability and corporate social responsibility,
as some of the key issues faced by management and leadership in the current age. It is important
that management in leadership comply with corporate social responsibility like this is so that
business is able to follow ethical practices and avoid legal troubles. In addition to this, managers
and leaders also need to look for effective implementation of sustainability initiatives so that
negative environmental impact can be minimized. These sustainability and corporate social
responsibility issues need to be solved by managers and leaders because it can lead to damaging
consequences for the firm, such as financially taxing lawsuits or reputation damage. It is
concluded that investment in latest technology and training leaders and managers to become
more focused on sustainability, ethical practices and corporate social responsibility can help the
company avoid such issues and attain success in an ethical manner.
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REFRENCES
Books and Journals
Dinnen, M. and Alder, M., 2017. Exceptional talent: how to attract, acquire and retain the very
best employees. Kogan Page Publishers.
Kang, J. and Jang, J., 2019. What do employees perceive as hindrance or challenge stressors in
the hotel industry? The role that hope plays. Journal of Human Resources in Hospitality
& Tourism, 18(3). pp.299-322.
Kang, M. and Sung, M., 2019. To leave or not to leave: the effects of perceptions of
organizational justice on employee turnover intention via employee-organization
relationship and employee job engagement. Journal of Public Relations Research, 31(5-
6). pp.152-175.
Kashif and et. al., 2017. You abuse but I will stay: The combined effects of job stress, customer
abuse, and emotional intelligence on employee turnover. Journal of Management
Development.
Khandelwal, A. K. ed., 2021. Transformational Leadership in Banking: Challenges of
Governance, Leadership and HR in a Digital and Disruptive World. SAGE Publishing
India.
Naim, M. F. and Lenka, U., 2017. Mentoring, social media, and Gen Y employees' intention to
stay: towards a conceptual model. International Journal of Business and Systems
Research, 11(1-2). pp.28-41.
Santhanam and et. al., 2017. Impact of human resource management practices on employee
turnover intentions. Journal of Indian Business Research.
Wright, C. F., 2017. Employer organizations and labour immigration policy in Australia and the
United Kingdom: The power of political salience and social institutional
legacies. British Journal of Industrial Relations, 55(2). pp.347-371.
Online
Tesco hands out £193m to settle 2014 accounting scandal, 2021. [Online] Available through
<https://www.retailgazette.co.uk/blog/2021/10/tesco-hands-out-193m-to-settle-2014-
accounting-scandal/#:~:text=Tesco%20has%20handed%20out
%20%C2%A3,proceedings%20against%20it%20last%20September.>
TESCO UNDER FIRE FOR ‘LAZY’ SUSTAINABILITY PLEDGE, 2021. [Online] Available
through <https://www.grocerygazette.co.uk/2021/11/02/tesco-sustainability-pledge/>
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