You are on page 1of 26

MBA541

Submitted to:

Yogesh Garg

Submitted By:

Yogesh Garg

Nirav Patel

Section I10N70

Corporate Social Responsibility (CSR) Audit on the Shop Exchange

For Year 2010


Executive Summary:
This report offer the opportunity for the audit group (MBA students: Yogesh Garg, and Nirav
Patel) for completing the corporate social responsibility audit of The Soap Exchange by using
the B Impact Assessment tool designed by B Labs. Further the audit group reviewed the firm
current position and its CSR initiative based on the B Impact result and prepares an action plan
for The Shop Exchange to improve their corporate social responsibility in the areas of:
Environment, Community and employees which can improve their B impact score and can help
them to get the B labs certification.

The results obtained from the audit of The Shop Exchange indicate that, it passed the B Impact
Certification criteria and achieve the composite score of 115.8 (see Appendix) which is higher
than the B impact minimum score of 80 to qualify for the B Impact Certification. The Though
The shop Exchange passed the audit of B labs, then main area where the Shop exchange score
an excellence are: Consumers by scoring 58 with 84% value signifies that the company
understand the need of the locality and provide them with their desire demand. Secondly the
Shop exchange also scores good in community by achieving score of 43.8 with 59% and finally
in term of accountability the Shop exchange score 9 point with 60% value proves that company
is performing its CSR activates by disclosing the facts to government. It needs significant
improvements in areas of employees, and environmental responsibility. The SWOT analysis of
The Shop Exchange indicates that, the shop Exchange has developed strong relationships with
its suppliers and buyers and also satisfies customers with its unique service and expertise
method. While on the flip side, the firm lack on the focus on environment sustainability and
face many issues with employees because of violation of many safety issues such as: proper
ventilation and proper disposal of waste ventilation and no disposal. There are significant
opportunists such as: collaborate with ecofriendly organizations and human rights organization
which help to increase social awareness through charity and donations and increasing
awareness and educating its employees. Government regulations and increased awareness and
power among the NGO`s and environmental groups create sustainable threat for The Shop
Exchange.

The owner, employees at the Shop Exchange Nanaimo Brach is the core stakeholders which are
essential for the firm’s survival. The strategic stakeholders include major clients and suppliers to
The Shop Exchange while the environmental stakeholders include community in Nanaimo,
Canada and the government. Further the goals and objectives are designed to improve the
corporate social responsibility. Detailed action plan and strategies are discussed in brief which
are required to be undertaken by The Shop Exchange for improving its sustainability and
corporate social responsibility. Finally the budget is outlined by the audit group after
undertaking their financial situation, detailing the expenses required for implementing the
above action plan to become socially responsible and getting a step closer towards achieving
the B Certification.

Page 2
Table of Contents:
Executive Summary:...................................................................................................................................... 2
Table of Contents: ......................................................................................................................................... 3
1.0 Introduction and B Impact Assessment: ........................................................................................... 6
2.0 Introduction of the Shop Exchange ........................................................................................................ 6
2.0 Methodology:.................................................................................................................................... 7
4.0 Situational Analysis: ................................................................................................................................ 7
4.1. Result of Audit: .................................................................................................................................. 8
4.2. SWOT Analysis: .................................................................................................................................. 9
Strength: ................................................................................................................................................... 9
Opportunities: ........................................................................................................................................... 9
Weakness: ................................................................................................................................................. 9
Threat: ........................................................................................................................................................... 9
4.2.1 Strength ..................................................................................................................................... 10
4.2.2 Weakness: .................................................................................................................................. 10
4.3.3 Opportunities:............................................................................................................................ 11
4.3.4 Threats: ...................................................................................................................................... 12
5.0 Stakeholder Analysis: ............................................................................................................................ 12
5.1 Stakeholders: .................................................................................................................................... 12
6.0 Goals and Objectives:............................................................................................................................ 16
6.1 Firm mission statement: ................................................................................................................... 16
6.2 Accountability ................................................................................................................................... 17
6.3 Employees ......................................................................................................................................... 17
6.4 Consumers ........................................................................................................................................ 18
6.5 Community........................................................................................................................................ 18
6.6 Environment...................................................................................................................................... 18
7.0 Strategies: ............................................................................................................................................. 19
8.0 Action Plans........................................................................................................................................... 20
9.0 Schedule: ............................................................................................................................................... 22
9.1. Create awareness............................................................................................................................. 22
9.2. Reviewing of Policies ...................................................................................................................... 22

Page 3
9.3. Minimize the environmental impacts during management of properties ...................................... 22
9.4Employees performance review ........................................................................................................ 22
9.5 Safe and favorable working conditions............................................................................................. 22
9.6 Community engagement .................................................................................................................. 23
10.0 Budget: ................................................................................................................................................ 23
References: ................................................................................................................................................. 25
Appendix ..................................................................................................................................................... 26

Page 4
List of Tables and Figures

Table 1: SWOT Analysis of the Shop Exchange on the basis of B impact Score ............................. 9
Table 2: Power Grid to show the power level of each of the stakeholder ................................... 15
Table 3: Employee Satisfaction ..................................................................................................... 20
Table 4: Environmental Responsibility ......................................................................................... 21
Table 5: Community ...................................................................................................................... 21
Table 6: Social Responsibility ........................................................................................................ 22
Table 7: Financial Information ...................................................................................................... 23

Page 5
1.0 Introduction and B Impact Assessment:
The purpose for CSR audit report is to evaluate and judge how well the firm performing its
social responsibility as a part of its running business. To check the how frequently the firm is
performing its CSR activities the B impact assessment is done. The B impact assessment audit
identifies the firm business practices effects on societies, Social and governance risk,
environment, and employs and provides a CSR plan in order to improve and develop
compliance with CSR policies, practice and process to achieve B certification. B Corporation
provide a tool for small and medium sized firms to use their business power to solve social and
environment problems to get B certification. B impact assessment is not just a certification
process which the firm needs to get but it is a comprehensive, active, clear, autonomous web
based tool which is developed by B corporation for the assessment and improvement of CSR
activities of the companies. In order to complete the audit our group (Yogesh, Supreet, and
Yufei) contracted one of the branches of The Shop Exchange in Nanaimo, Canada. Following
the introduction will provide the reader with the brief description of the firm, followed by
details of the methodology adopted to conduct the audit. Further the results of audit and
SWOT analysis is done to provide the situational analysis and stakeholder analysis. The goals
and objective are outlined followed by strategies should be adopted to improve their areas of
weakness to achieve the B Impact Certification. In addition the action plan and schedule is
discussed in detail in order for The Shop Exchange to achieve the B Certification. Finally the
budget is provided.

2.0 Introduction of the Shop Exchange

The Soap Exchange was found by Wes Koch in early 1990’s which is locally owned and operated
business. It supports various local clubs, teams, and societies. The purpose of this Shop is to
provide a business opportunity for moral-conscious, non-gender specific, and environmentally
sensitivity peoples. The firm deals in 100% biodegradable products which are easily
decomposed in short period of time without effecting natural environmental of earth. In
addition the firm also provides high quality products with commercial packing which helps to
reduce wastage and all of its products are served to customers at reasonable prices (The Soap

Page 6
Exchange, 2010). The Soap Exchange also helps to reduce the cost of household and at
workplace cleaning products by 30% as they only provide eco-friendly products. The firm also
deals in various personal care products such as: hair care products, hand and body soaps bars,
face and body creams, essential oils which are fuel for a sensitive skin. Additional services
offered by the firm are: Free delivery service is offered to retailers and commercial customers
in great Victoria region but if purchase is over $50, Full money-back guarantee is provided by
firm on its entire product which firm produce. Beside all this the firm provides wide variety of
products which are locally made such as: shampoo bars, hand creams, hair shampoo bars,
deodorant crystal, green pens, essential oils, and pumice stones at a reasonable price. Recently
firm has stared new service known as dry cleaning and drop off service for customers. (The
Soap Exchange, 2010).

2.0 Methodology:
The audit was conducted with Mr. Shirley Reid owner of The Soap Exchange at Country Club in
Nanaimo at British Colombia Province in Canada to see the score of the firm according to B labs
assessment policy. The audit was conducted by the group consist of (Yogesh Garg, and Nirav
Patel) an MBA candidate. The purpose of the audit is to see how much firm is involved in social
responsibility activities while undertaking their business process and how much they care about
the environment. In order to complete the audit successfully the benefits of B impact
assessment were shared with Mr. Shirley Reid on 2nd June 2010. When owner came to know
about the benefits of the B labs assessment Mr. Shirley Reid approved agreed for B impact
assessment. Interview questions were prepared by our group B corporation assessment tool.
Over the period of week interview was conducted via phone calls, emails and personnel
interview.

4.0 Situational Analysis:

The situational analysis of The Shop Exchange is based on two main factors which include:
results of Audit and SWOT analysis on the base of the B impact assessment composite score
(Appendix 1). B Impact assessment shoes that firm achieve the composite score of 115.8 which

Page 7
is much higher than the B Impact qualifying score for certification which is 80. The score
obtained by the Shop Exchange in various segments of B impact are shown in the results below:

4.1. Result of Audit:

B Impact Assessment is done on Soap Exchange with the help of B Corporation. The firm scores
total of 115.8 which is a good score and can help the firm to go for B certification as the
minimum score requirements is 80 (B Corporation, 2010). The assessment is consisted of
different areas like Accountability, Employees, Consumers, Community and Environment. Each
area is further divided into many sub-parts such as Accountability includes Governance &
Transparency, Employees includes Work Environment, Employee Ownership &
Compensation/Benefits, Consumers include Beneficial Business Model & Beneficial
Products/Services, Community includes Suppliers, Local, Diversity & Charity/Service and
Environment includes Facilities, Energy Usage, Supply Chain and Manufacturing. The firm scores
different scores in different areas. Highest score could be seen in Consumers part which means
firm is totally consumer-oriented and provides products and services which are totally valuable
for consumers. It means the impact of the products or services on the consumers is not harmful
as their products are eco-friendly and do not contain harsh chemicals. It is prepared for the
environment friendly and allergic people by doing the personnel interview with Shirley Reid.
84% has been scored by the firm in this area. Moreover accountability and community scores
are almost same i.e. 60% and 59% respectively. This means firm is interested in providing
transparency to the government as well as to their customers. Moreover the firm has already
mentioned its awareness about the environment in its mission statement which enables the
firm to get high score in this area. The firm lags behind in the areas of Environment and
Employees as it scores only 25% in environment while in employees it is 0%. The reason behind
is that the firm have less employees and those employees are also part time employees. As a
result of which no compensation benefits are being provided to them. Furthermore in case of
environment company’s suppliers and customers are mainly from local community. The firm
provides information about their community service policy to their consumers as well as to
their suppliers. The main drawback is that in their operating stores they are not using energy
from renewable sources. But for the plastic bottles recycling they do encourage their customers

Page 8
to bring back the bottles to the store and they will give them some discounts for the next sale.
This helps them to reduce their cost as they do not have to buy new bottles. All the time but
the people who bring bottles back to the store is only 35-40% by personnel interview with
Shirley Reid. Diversity is not applicable in this case as there is not special recruitment process
for employees as well as suppliers. The details of the scores are provided in the Appendix 1.

4.2. SWOT Analysis:

Based on the B impact assessment composite score the strength, weakness, opportunities and
threats of The Shop Exchange are explained briefly in the table:

Table 1: SWOT Analysis of the Shop Exchange on the basis of B impact Score

Strength: Opportunities:
Based on B impact survey the strength of firm  Collaborate with Christian labour
are: Association of Canada (CLAC) for the
 Maintains Goodwill in protection of employees rights and
community power
 Maintain Transparency in  Collaboration with Earth Liberation Army
operations (ELA) for going green
 Understanding the local
environment needs and
successful in satisfying
consumers

Weakness:
 Lack of focus on environment Threat:
sustainability  Change in Government rules and
 Issues with employees regulations
 Awareness for clean and
environment friendly products
among customers
 Environment organizations and
NGO’s Influence on business
practices

Page 9
4.2.1 Strength
Maintain Goodwill in Community
The B impact assessment shows that firm did a good job in getting qualifying in B Impact
assessment in case of Community section. The firm involves in many charity events every year
where they give some donations to poor and needy persons who need and try to provide them
with services. The employer has successfully maintained a good relation with their suppliers as
they provide their supplier with the up to date information which the supplier needed. Further
by conducting an interview with Shirley Reid he addresses our group the firm had never faced
any problems with the suppliers. Beside all this the firm also donates 3% of their net profit to
charity.
Maintain Transparency in operations

The firm did well in case of transparency and governance on the base of B Impact assessment
by interviewing Shirley Reid he address that firm also provide the government with the up to
date information and follow the government rules and regulation as they have never face any
problem in case of government issues. Further the financial statements are reviewed by their
managers on monthly basis. The firm also shares their financial statements with their
employees to get there feedback on improvement of profit. In addition the firm has formal
method for the employees to address business issues or complaints. Because of all these
features the firm qualifies for accountability section of the B Impact.

Understanding the local environment needs and successful in satisfying consumers:


The Shop Exchange is also good in marinating a good relationship with employees by
understanding the needs and requirements of the local community and providing them with
the product that matches their needs and requirements. Based on these qualities the firm did
well in satisfying their customers to the maximum level.

4.2.2 Weakness:
Lack of focus on environment sustainability

The firm is putting some efforts on recycling and energy conservation that demonstrates The
Shop exchange concern for the environment; however the firm is not focused towards
environment sustainability. The firm has not expressed its commitment to environment
stewardship and social issues in its corporate mission statement and has not specifically

Page 10
dedicated any manpower to oversee social and environment responsibility, and thus lacks to
demonstrate its focus towards environment sustainability. Following to it, the firm has no
training module on social and environment issues for the new and existing employees. Hence,
firm cannot achieve environment sustainability without converging itself completely. This will
take concrete steps and restructuring of some of its operations and can incur initial investments
of money and time, and is identified as weakness.

Issues with employees

The Shop Exchange fails to qualify in section of employees because the firm doesn’t have any
full time employees. The firm doesn’t have any compensation and benefits plans expect the
salary , further the working environment conditions provided to part time employees are not
well under which the employees work. This can lead to future problem.

4.3.3 Opportunities:

Collaborate with Christian labor Association of Canada (CLAC) for the protection of
employee’s rights and power

The CLA used to protect the labor rights of the Canadian employees working in an organization.
Canadian labor union applies Christian social principles of justice, respect, and dignity to the
workplace community. It provides quality representation and a wide range of benefits and
training for its members, and active member advocacy that strives to build healthy work
communities based on mutual respect and partnership. So far The Soap Exchange has not taken
benefits of this service because they had not employed any full time employees but this is an
opportunity for the Soap Exchange in Future.

Collaboration with Earth Liberation Army (ELA) for going green


The firm has never engaged with its supplier for reducing the environmental impact, however
ELA, the major supplier offer services to achieve environmental sustainability. ELA offers green
services to the restaurants. It helps restaurants in reducing the carbon footprint and becoming
environmentally sustainable. So far The Soap Exchange has not taken any benefit from the
services offered by ELA and it is an opportunity for the firm to achieve environment
sustainability.

Page 11
4.3.4 Threats:
Awareness for clean and environment friendly products among customers

In current scenario due to influence of media and advertisement many people are aware of the
ecofriendly products and they are using green products which can reduce the effect on the
environment. The Soap Exchange can have a big threat of this thing because the customers will
look at the ingredients used by firm to manufacture that product. By reviewing the ingredients
list if customer finds that particular ingredients can affect the environment then the customers
can report to media and media will create a huge rumor which can lead a bad image for
company.

Change in Government rules and regulations


In current scenario the Shop Exchange can face a threat from the government because
government can change the rules and regulation regarding the environment friendly equipment
to be used for manufacturing and can also impose the restriction on the usage of certain
products which can affect the environment from the government prospective. But that can be
essential for business to complete its manufacturing process. The government rule and
regulation can be a major threat for the Soap Exchange.

5.0 Stakeholder Analysis:


The stakeholder analysis is a process to gather information and analyze the information to
check/evaluate which shareholder interest should be taken into account while deciding or
implementing any new corporate policy (Schmeer). To understand the term stakeholder
analysis lets discuss little bit definition about stakeholders:

5.1 Stakeholders:
Stakeholder can be both Person, group, or organization that has direct or indirect stake in an
organization because the stakeholders can affect or be affected by the structure, objectives,
and policy of the organization (Investor Glossary,2010) . Form the B Impact Assessment of The
Shop Exchange our group identifies various stakeholders who will have impact of B audit.
1. Institutional Owners- The founder of the firm who is individual owner of the firm and is
running operations in Canada.
a. The Soap Exchange Founder - Chairperson of the Shop Exchange.

Page 12
b. Investors- People investing in The Soap Exchange with long or short term profit p
prospects.
2. Employees – People with different skills necessary for running operations of The Shop
Exchange.
a. Chemical engineers- Chemical engineers play an important role in company’s business.
They make sure that proper quality chemical is supplied to firm that will be valuable
for firm customer.
b. Technologists- Technologists work along with chemical engineers for inspection and
testing.
c. Support staff- Firm staff providing operating support to firm in handling
documentation for exportation, importation, accounting, taxation, marketing, sales
etc.
3. Governments- Governing bodies such as federal, provincial and municipal require degree of
disclosure for insuring compliance with their regulations.
a. Canadian Federal Government
b. British Columbia provincial Government
4. Customers-B2B (Canada) - The Shop Exchange’s customers are chemical industries such as
pine oil, turpentine, paints and enamels etc. Therefore The Shop Exchange imports these
chemicals from suppliers in Canada and United States for fulfilling demands.
a. Paint, oil and chemical Industries in Tehran.
5. Suppliers of chemicals-B2B from Canada – Several suppliers within Canada from whom the
firm can get good quality profitable chemical supply.
6. Transportation providers- Those agencies r shipping corporation or airways that provide
freight services to The Shop Exchange. Shipping is commonly preferred whereas air services
are preferred at time of urgency.
7. Community- (Residing in Victoria and Nanaimo)
a. Residents living close by The Shop Exchange Firm- These Residents live nearby The
Shop Exchange are affected by its daily operations either directly or indirectly. The
effect can be positive or negative providing opportunity or threat to The Shop
Exchange.

Page 13
b. Local media (CTV, Global broadcast, city TV, CTS, Joy TV, The Globe and Mail,
Nanaimo Daily News, Early Victoria Newspaper, Victoria News, and British Colombia
Magazine) - CTV, Global broadcast, city TV, CTS, Joy TV, The Globe and Mail,
Nanaimo Daily News, Early Victoria Newspaper, Victoria News, and British Colombia
Magazine . These media agencies broadcast news related to business companies
related to any environmental, legal concerns.
c. Banks (Canada) - These institutions that provide financial support to the Shop
Exchange in the form of debts and get interests from time to time example of Some
popular banks in Canada are: CIBC, Toronto Dominion Bank (TD), and RBC
d. Charity (Educational and health providers)- These are charitable societies in Canada
that get some financial support by the Shop Exchange for promoting education and
providing health services to local people.
8. The Shop Exchange competitors exporting and importing same semi-finished chemicals –
the competitors’ keep on searching ways to acquire company’s business and profit. Their
main concern is to grow their market share.
9. Social Activist groups-
a. NGOs- These groups’ work for the needs and rights of Canadian society. BC Civil
liberties Association and Human Right research deals project the rights of the
community.
b. Chemistry Industry Association of Canada- Chemistry Industry Association of Canada
works cooperatively with governments and other groups, companies to find
solutions that benefit both Canadian society and the nation's chemical industry.
c. Organization for economic co-operation and development- It has influence upon
international trade and works to support sustainable economic growth, help
countries to get economic development.
d. Global environment organizations- These organizations take care of environmental
issues that arise due to Bio degradable waste and material disposition in air and soil
deforestation resulting into harmful effects to environment and species existing on
the land

Page 14
10. Consumers: These are end users of the final products that are made by products traded by
the Shop Exchange

Table 2 will show and elaborate the power grid that The Soap Exchange should follow to keep
and retain its current stake and what are the most important stakeholders who required more
attention

Table 2: Power Grid to show the power level of each of the stakeholder

High Interest Low

Stakeholder Type 4 Stakeholder Type 1


Mixed Blessing Supportive
Strategy: Collaborative Strategy: Involve
High
Stakeholders: Social Activist groups- NGOs, Stakeholders: Institutional owners of The Shop
Global environment organizations, Chemistry Exchange s, Employee, Customers-B2B,
Industry Association of Canada, Organization for Suppliers, Transportation providers.
economic co-operation and development.
Power Stakeholder Type 3 Stakeholder Type 2
Non supportive Marginal
Strategy: Defend Strategy: Monitor

Stakeholders: The Shop Exchange Competitors’, Stakeholders: Consumers, Local Residents,


Federal, Provincial and Municipal Governments Charity (Educational and Health services) in
Low
and News agencies in Canada. Canada.

(Source: Mind Tools)

Stakeholder Type 1- Institutional owners of The Shop Exchange s, employees, customers-b2b,


suppliers and transportation providers are high on potential for cooperation and low on
potential for threat. Involvement strategy is applied to insure opportunities.

Stakeholder Type 2- These stakeholders are consumers of end product made by chemicals
supplied by The Shop Exchange , local residents nearby The Shop Exchange , charity
organizations are low for both threats and cooperation. Therefore the strategy applied is
monitoring just to insure that circumstances remain favorable.

Stakeholder Type 3- The Shop Exchange competitor’s, governing bodies and News agencies in
Canada are high on potential for threat but low on potential for cooperation. Government
bodies can apply restrictions to chemicals imported to Canada in case of any environmental

Page 15
concerns whereas news agencies can harm the reputation of firm in some unfavorable
situations. Therefore, the preferred strategy is to defend.

Stakeholder Type 4- Stakeholders such as NGOs, Global environment organizations, Chemistry


Industry Association of Canada, Organization for economic co-operation and development are
high on both potential for threat and cooperation. The preferred strategy is to collaborate that
will result into supportiveness of such stakeholders and reduced risks of potential threats.
Furthermore, it will lead to more understandings between stakeholders’ and The Soap
Exchange providing potential opportunities.

6.0 Goals and Objectives:


The goals & objective of companies are been divided in various heads such as: Firm mission
statement, accountability, employees, community and environment.

6.1 Firm mission statement:


The Soap Exchange has its written corporate mission on commitment to social impact,
environmental stewardship, animal rights and customer healthcare. According to CSR theory, a
B-Corporation mission statement should concern on most of its stakeholders. Referred to
Freeman’s stakeholder theory, it is better to add in impact on other stakeholders such as
employees, investors, suppliers, banks, neighbors, aboriginal peoples and media.

 To creatively balance the financial and human needs of our stakeholders: employees,
customers, suppliers and investors.
 To meaningfully contribute to the local involvement including local recruitment, local
purchasing, local donation under a code of conduct on care, honesty, fairness and respect.
 To be affordable fashion of aromatherapy bath and environ-safe green life style for low or
moderate-income communities that we enhance the quality of the life.
 To ensure that the whole of business process is operated ecologically sustainably, meeting
the trends of green technologies on the renewable emerge and recycling materials.
 To passionately communicate with the members of Clean-Up Club and suppliers to protect
the environment, and against animal testing within the Home & Personal Care industry
(The Soap Exchange, 2010).

Page 16
According to the audit result and the redirected mission statement, The Soap Exchange should
set goals and objectives on the aspects of accountability, employees, consumers, community,
and environment. New mission statement illustrates the benefit for various stakeholders. The
firm should explicitly integrate the commitment in daily operation management.

6.2 Accountability
To improve a score and to keep its accountability as its strength our group has set up one and
two year’s goals for The Soap Exchange:

1st year goal: The Firm in forms internal and external people and establishes brand awareness
for employees, suppliers.

2nd year goal: The Firm establishes not just brand awareness, but also firm image (a social
responsible company).

The Objective on the basis of one and two year goal is:

The firm should schedule the governing body or outsourced CSR advisory body to oversee
executive compensation and the information transparency to all of the employees, suppliers,
members of Clean-Up Club, customers and investors.

6.3 Employees
1st year goal: The Firm creates one full-time position and designs teenager’s intern program
with the support of local government.

2nd year goal: The firm improves employee compensation plan and be investigated by the other
store owner in Victoria.

The Objective related to employees on the basis of set goals are:

The firm employed one full-time employee last year, but only three part-time employees this
year. Nanaimo has many high schools and one university. It is feasible to low-cost local
recruitment. With the increase of senior citizen population in Nanaimo, the healthcare cleaning
products of The Soap Exchange will be more and more popular. Expanding business is right in
few years. At that time, the firm will need more employees, full-time and part-time. It is
suggested that job creation for teenagers is necessary and training them to socialize with local

Page 17
communities, families to promote the products. At the same time, the firm should start to care
about the working environment and compensation plan for employees.

6.4 Consumers
1st year goal: The Firm collects all of the existing customer’s information and contacts them for
feedback.

2nd year goal: The Firm develops marketing campaign for fundraising and increasing sales by
10%.

The objective of the firm related to customer on the basis of one and two year goal are:

Owners of the store have good longtime relationship with the existing customers. Clean-Up
Club program locks the loyalty of customers. In order to produce more income for the company,
the firm needs media to promote their products. Media discloses the information of the firm
and its CSR practices. And socializing with existing and potential customers is always useful for
the firm to produce beneficial products and services and finally it is profitable for consumers
and internals of company.

6.5 Community
1st year goal: The Firm collects information from the local suppliers, banks and attracts
aboriginals to be suppliers of giftware.

2nd year goal: The Firm forms a local community circle according to local purchasing, local
selling, local recruitment and local donation.

The objective on the basis of community related to achieve the first and second year goal is:

The company’s 75% of goods come from one significant supplier located in Saskatoon. 25% of
goods are giftware, which should be sourced from local handcraft people, low-income, and
aboriginal groups. The firm should improve their local involvement by local purchasing strategy,
local recruitment and local donation.

6.6 Environment
1st year goal: The Firm forms a recycling program for a wide range of materials used in office
daily operating.

Page 18
2nd year goal: The Firm cooperates with a renewable energy firm to revise the light and hydro
system.

The objective in regard to environment to achieve the set goal of the firm is:

The firm should create a really environmental friendly operating system when they do business
in retail store. They should use renewable energy systems and office wide recovery and
recycling program that includes other materials than plastic

7.0 Strategies:
Based on the B impact survey of The Soap Exchange our group has identified various strategies
the firm must use in order to increase it composite score and to qualify for employees and
environment section:

(i). The firm must identify and disclose the non-toxic inebriant which the firm is using to
manufacture its products for this the firm can contact to suppliers to get the information about
the manufacturing process; and make customers aware of their product manufacturing
process; that all the products of firm are environmental friendly and bio degradable.

(ii).The firm must have a governing or advisory body to push the information transparency to
government and to governing body can review the financial of firm

(iii).Job creation for students in high schools or university (to train those marketing skills and
benefit for the store also)

(iv). Support local summer campus. Support local customers to visit the business process in
their manufacture. Or sponsor summer campus the personal care products for free.

(v). disclose the information within the clean-up club, about fundraising program, where the
money go and come. Ask organization permission to disclose some organization name to
outsider’s via media

(vi). local purchasing strategy or policy. Keep the existing supplier of the soap exchange goods
(75% of the whole goods), and use local resource to fill in the other 25% goods in store.
Connect to local handicraft business, aboriginal people

Page 19
(vii). full transparency regards to donations made. Donations made direct to charities and
causes by individual markets and donations in kind are not always publicly reported, but are
monitored internally to ensure compliance with this policy.

(viii). carefully provide membership of clean-up club to organizations; carefully check the
potential registered clients in fundraising program. No donations can be made to any
organizations linked to animal testing, advocating violence or discrimination.

(ix). store’s facility improvement (Energy usage, light, water, recycled paper)

8.0 Action Plans


Based on the above discussion our group (Yogesh, and Nirav) has decide the action plan which
the firm should follow to increase its B composite score and to also to convert their weakness
into strength. The Action plan is divided into three main categories such as: Environment
responsibility, Social responsibility, and community engagement because these are the only
three areas according to B impact survey where the firm lacks in term of their Corporate Social
Responsibility.

Table 3: Employee Satisfaction

Action Objective Personnel Responsible


Start Recurring Full time Increase efficiency and quality in
employees production
a.) Performance will be increased
Provide training to employees for Improve employees quality
personal as well as organizational
growth Shirley Reid & Barry Reid
Formalize the employee To be Transparent
promotion process and make it
transparent to all employees

Involve the employees in decision Give importance employee


making process

Page 20
Table 4: Environmental Responsibility

Actions Objective Personnel Responsible


Monitor and where possible Reduce the energy consumption The country club mall
reduce energy consumption. management team and the
owners of store of The Shop
Exchange
Optimize the use of resources Minimize the industrial waste The country club mall
for production management team;
Owners to approve for use

Ensure that contractors Create a sense of belongings and Barry Reid


(including cleaners, maintenance suppliers will also focus on eco
personnel etc. act in accordance friendly product which will reduce
with the Firm Policy. the damage to environment
Form the policy which shapes Formalize environment saving The country club mall
firm’s attitude towards process management team;
environment One of their employees

Increase the use of recycled Preserve the environment policy Shirley Reid
material in firms daily activities

Table 5: Community

Action Objective Personnel Responsible


Form Supplier Policy for quality and To ensure the quality of raw
make audit to supplier’s material
manufacturing facility

Start participating in local Local involvement Barry Reid


community activities

Seek to continue to qualify as a Ongoing financial support to key The Clean-Up Club
member of the 10% fund raising charities. governing body :
activities and will continue to align its Shirley Reid
charitable giving and community One of their employees
involvement to its chosen areas of Outsourced CSR advisor
investment. Wes Koch (the owner of
other Soap Exchange
store in Victoria)

Page 21
Table 6: Social Responsibility

Action Objective Personnel Responsible


Fully comply with all the requirements Undertake a Health & Safety risk *Outsourced CSR advisor
of the Health & Safety at Work Act for assessment for the company. *Owners of the store
employees and those that may be b.) Monitor legal compliance
affected by its activities. within the company.

9.0 Schedule:
As this action plan is targeted for June 2010- June 2012 so the schedule for the different
activities mentioned in the action plan is described below:

9.1. Create awareness


The awareness need to create about the social, environment and community policy to the
employees, suppliers and customers is to be done within 3 months i.e. from June 2010-
September 2010.
Awareness among all employees and suppliers within 2 months
Identification of key suppliers and exchange of policies with each other for 1 month

9.2. Reviewing of Policies


Review the policy after 1 year i.e. in June, 2011.
Improve transparency while providing information about its performance on the
website – after 1 year, June 2011.

9.3. Minimize the environmental impacts during management of properties


Reduce energy consumption – 1 year i.e. from October 2010- October 2011.
Reduce waste & extend recycling – 1 year i.e. from November 2010- November 2011.
Dispose of hazardous material – June 2010 to June 2012.

9.4Employees performance review


Create a CSR awareness training program for employees & suppliers from June 2010 to
December 2010 and repeat annually.

9.5 Safe and favorable working conditions


Health & Safety risk assessment for the firm to be review annually

Page 22
Monitor legal compliance within the firm from December 2011 to February 2012 and
repeat annually.

9.6 Community engagement


The firm must involve in charitable giving and community involvement at its chosen
areas of investment from June 2010- June 2010.

10.0 Budget:
By interviewing with Shirley Reid Nanaimo Brach head the financial statement of Firmware as
follows:

Table 7: Financial Information

Particulates Amount (CAD) $


Sales 2000000
COGS (45% of sales) 90000
Gross Profit (Sales-COGS) 110000
Expenses (Including-rent, Hydro, gas, 38500
Insurance etc) 35% of Gross Profit
Net Profit 71500

Based on their financial capability our group suggested some cost saving techniques to improve
their B composite score and to qualify in areas of community, environment and employee
section:

Cost of Installing Devices:

a. Install the electrical saving equipment such as Compact fluorescent lamp Lights which will
cost only $15 for 26 watt up to 6-pak form Wall Mart (Wall Mart, 2010). Because BC hydro is
replacing Replace Incandescent with CFLs (BC Hydro,2010)
b. Hire 5 full time employees for year 1 and pay them on day basis: pay them $50 for each
60 soap produced in day
c. Provide training to employees from the senior person working in Nanaimo Soap
Exchange Branch which will incur lees cost. Or simply pay trainer up to 4% of monthly
sales and some daily benefits of $ 25 if they achieve the target
d. Usage of recycle material will cost nothing. But if they buying for recycle material should
be up to 3% of day sales
e. Start evolving employees in to promotion proceeds and pay them bonus and
compensation for ex: pay them 10-15% bonus on the amount of exceed standard
targets

Page 23
f. Qualify as a member of the fund raising activities by giving only 10% of their monthly
sales to charity.
g. Pay bills of key employees up to 5% of sales bills can be: electricity, hydro, cable and gas.

Benefits:

a. Compact Fluorescent Lamps (CFLs) use about one-quarter (75% less) energy that
incandescent bulbs use to deliver the same amount of light. Further an ENERGY STAR
qualified compact fluorescent light bulb (CFL) will save about $30 over its lifetime and
pay for itself in about 6 months and lasts about 10 times longer than an incandescent
bulb.

b. If Soap Exchange employees 5 full time employees it will make their production process
faster and also it will ensure the quality of product will be same as compare to part time
because different part time employees will have different skills and knowledge and each
one skills will be different from each other. Example: If firm hires 2 part time employees
for a day and each part time employees will work for 4 hrs. the quality of finished
product will not be same the product produced by first part time employee may be
better than second part time employee or vice versa. This will not happen in case of full
time employees.

c. The business world is continuously changing; organizations will need to provide their
employees with training throughout their careers. If they choose not to provide
continuous training they will find it difficult to stay ahead of the competition .The other
benefit shop exchange will achieve by training its employees is that it will keep your
employees motivated. New skills and knowledge can help to reduce boredom. It also
demonstrates to the employee that they are valuable enough for the employer to invest
in them and their development.

d. If the Shop Exchange provide promotion to employees it will motivate the employees
and employees put their best efforts to get promotion which will increase the firm
production and also help to reach the set goals and targets.

e. If Shop exchange donate some portion of its profit to charity program. The charity giving
program will help the firm the firm to build its image in sorcery and local community.
Further if firm is supping poor children or backward society the firm can also enjoy some
incentive from government in form of: tax emption, or few restriction, further it will
better for the future.

Page 24
References:

The Soap Exchange (n.d.) Enviro-Wise Refill Centre: your greener, cleaner store [Internet], Victoria B.C,
The Soap Exchange. Available from: <http://www.victoriasoapexchange.com/> [Accessed 12 June 2010].

Mind Tools (2010) Stakeholder Analysis: Winning support for your projects [Internet], Mind tools ltd,
all right reserved. Available from: < http://www.mindtools.com/pages/article/newPPM_07.htm>
[Accessed 12 June 2010].

Schmeer, K. (n.d.) Stakeholder Analysis Guidelines [Internet], Available from:


<http://www.lachsr.org/documents/policytoolkitforstrengtheninghealthsectorreformpartii-EN.pdf>
[Accessed 11 June 2010].

Wall Mart (2010) American summer: Add Sizzle to summer grilling [Internet], GE CFL Light Bulb: 26 Watt
(100W Equivalent), 6-pk. Available from: http://www.walmart.com/ip/GE-CFL-Light-Bulb-26-Watt-
100W-Equivalent-6-Pk/5646244 [Accessed 10 June 2010].

BC Hydro (2010) BC Hydro for Generation [Internet], Replace Incandescent with CFLs. Available
from: <http://www.bchydro.com/guides_tips/green-your-
home/lighting_guide/Replace_Incandescent_Bulbs_With_CFLs.html> [Accessed 12 June 2010].

Investor Glossary (2010) Investor Glossary [Internet], Dogs of the Dow. Available from:
<http://www.investorglossary.com/stakeholder.htm> [Accessed 10 June 2010].

Page 25
Appendix

B Consumer Report
Last update 06/04/10

The Soap Exchange


Composite B Score: 115.8

B Corporations aspire to benefit all stakeholders, not just shareholders. Points %


Earned Value

Accountability 9.0 60%


Governance 6.0 67%

Transparency 3.0 50%

Employees DID NOT QUALIFY 0.0 0%


Compensation & Benefits n/a n/a

Employee Ownership n/a n/a

Work Environment n/a n/a

Consumers 58.0 84%


Beneficial Products or Services 44.0 80%

Beneficial Business Model 14.0

Community 43.8 59%


Suppliers 8.0 80%

Local 15.0 50%

Diversity 1.7 17%

Charity / Service 19.2 79%

Environment DID NOT QUALIFY 5.0 25%


Facilities 4.5 37%

Energy Usage 0.5 6%

Supply Chain n/a n/a

Manufacturing n/a n/a

Page 26