FILAMER CHRISTIAN UNIVERSITY

Graduate School
Masters in Business Administration
First Semester, A.Y. 2021 – 2022

MBA 401: SOCIAL RESPONSIBILITY AND GOOD GOVERNANCE

MS. MA. NETGIL F. GEVELA PROF. MARLENE A. AGUIRRE, MPA,MBA

Student Course Facilitator

CSR Output No. 3

Case Analysis

In 1982, XYZ Cement Company began its plant operation in

Pampanga. Local residents were very happy because of the

economic benefits they got from the plant especially the 400

local residents employed. After a few years of operation, the

plant started to emit large volumes of pollution. Local

residents, noticed the constant vibration and loud noise coming

from the plant. The residents claimed that the loud noise and

the vibrations posed dangers to their health and damaged their

property.

The company is using the best available technology in their

operation. The court refused to issue the injunction arguing

that closing the plant would mean more harm than good to both

parties. The court instead ruled that the XYZ should pay the

residents a one-time fee to compensate them for the damage done.

The amount was computed based on the fair market price the

residents would receive if they were inclined and able to rent

their property.
 FILAMER CHRISTIAN UNIVERSITY
Graduate School
Masters in Business Administration
First Semester, A.Y. 2021 – 2022

Questions and answers:

1. Was the decision of the court fair? Why or why not?

Businesses should not only focus on gaining profit but also

adhere to Corporate Social Responsibility by taking into account

environmental and social issues. However, even XYZ Cement Company

was a great help to the residents by increasing employment rate

in the area, it led to multiple negative effects that these

residents cannot withstand, and the final verdict of the court to

continue the operation of XYZ company is not acceptable in my own

opinion. The settlement was not fair for the residents and would

not benefit them in the long run. For the main reason that human

resource is one of the vital keys in maintaining and achieving

better operations in the business. Residents who work for them

and are not given the most valuable treatment would result in

poor performance and would let them perceive an unhealthy working

environment. Through that, the company in no time would still

fail and lose its opportunity to thrive and have stable standing

in the manufacturing industry. Aside from this, various

pollutions- air, land, and even noise, that deplete the

sustainability of the environment and cause harmful impact to

residents, is more than enough reasons to support the closure of

the manufacturing plant.

 FILAMER CHRISTIAN UNIVERSITY
Graduate School
Masters in Business Administration
First Semester, A.Y. 2021 – 2022

2. If you were the owner of the cement plant, what will you do

to solve the problem?

Any business that ensures sustainability in the ecosystem will

surely bounce back to the company’s organizational goal, thus,

being the CEO of the XYZ Cement company, if the court allowed the

business to operate, first, I would assess and understand the

company’s current state, through that, I will be able to generate

plans that benefit the environment, my people and how they can

contribute to the business’ success. Second, I will reduce the

waste that causes severe pollutions by sourcing out high

technology machines that could lessen manufacturing waste and

incorporate innovations to shorten the process which resulted in

noise and vibrations in producing cement products. Lastly, I will

hold a two-way discussion with employees in which feedbacks,

inputs, and suggestions are welcome. Through that, it will help

residents to be more open about the political issues that

constraint them in working and live a harmonious life outside

work. Without a doubt, the changes made in the company to have a

long-term positive effect in the ecological community would not

only benefit the environment but will also have a favorable

impact on humanity as well as it will be beneficial to the

business in generating a profit and have a good reputation.

 FILAMER CHRISTIAN UNIVERSITY
Graduate School
Masters in Business Administration
First Semester, A.Y. 2021 – 2022

3. Discuss the cost and benefit of the case from the

perspective of the principle of utilitarianism.

As long as the conduct of certain actions benefit the maximum

number of people and how it produces happiness and positivism in

the society for the betterment, it is considered doing things

morally and an act of utilitarianism. This principle signifies

how XZY Company should behave and act towards obtaining its

goals. However, the company's intention to produce cement

products made an impact that is not beneficial to the residents

that motivated them to take legal actions in order to settle this

mishap. The cost of expenditures of the company by settling the

damage was too costly and would still complicate the situation

eventually. Instead of doing so, spending the money to use high

technology machines and equipment, and incorporating innovations

would improve the products that will be made and better the

production process that will lessen noise and other health

issues. Over a long period of time, the company will gain support

from the residents for considering their well-being and would

then have a good impact on their performance that leads to the

company’s success. Going forward with this development would

surely outweigh the cost of the company in the long run if it

focuses on the welfare of the maximum, which is the people in

 FILAMER CHRISTIAN UNIVERSITY
Graduate School
Masters in Business Administration
First Semester, A.Y. 2021 – 2022

the organization and the residents in the area where the

manufacturing company is located, rather than centering the

viability of the company through a sole motivation which is

generating profit.