CSR Essay Example | Topics and Well Written Essays - 1500 words

CSR - Essay Example 16-22). It is highly important for an organization maintain strong relationship with, customers, business clients, employees and several external stakeholders. Effective business operation sustainability and CSR activities can help an organization to maintain strong relationship with the stakeholders and several shareholders. The essay will support that the CSR reports of the organizations generally provide useful information on the environmental performance and corporate social performance by considering the example of Tesco Plc and several other firms by considering several accounting theories. Discussion Instrumental theories In this theory CSR is seen as a strategic tool so that it can achieve the economic activities of a company and can ultimately lead to wealth creation. According to the Friedman view, it is seen that the only responsibility of the business it has towards the society is maximisation of the profits of the shareholders while working within the legal and ethical f ramework of the company. This theory has long enjoyed the acceptance of the business across the world. Such concern for profits include taking into consideration the interest of all the stakeholders of an organisation. It is argued that in some conditions such satisfaction can increase the overall profit and hence result in maximising the shareholder value. It has been seen that there is a positive correlation between the social responsibility and the financial performance of the companies (Brennan and Merkl-Davies, 2013, pp. 109-132). Here there are three main groups of instrumental theories on the basis of the economic objective of the company. The first is the maximization of the shareholder value. The second is focusing on the strategic goal of achieving the competitive advantage. The third is the related to the cause-related marketing efforts of the company. British Petroleum understands this aspect much better. The policy statement of BP commits the company to its wide ranging business policies. The CSR report of the company illustrates way the company is meeting those commitments in a way which supports the profitability of the company. Hence by focussing on the Strong financial performance the company can invest the profits into their CSR activities (Deegan and Rankin, 1996, pp. 50-69). Political theories Political theory is an effective CSR accounting theory that used to focus on the interaction between the society and companies and their responsibilities towards the society. There are three divisions of this theory that are discussed below. Corporate Constitutionalism According to this concept the social responsibility of an organization generally arises depending upon the available social power of Organization. Coca Cola Company is one of the leading organizations. The organization implements several green strategies depending upon its social power. Effective water recycling strategy helps the organization to maintain is leading organization within global soft drink industry. Social Contract Theory Jean- Jacques Rousseau was the political economist who posited the social contract theory. According to him the individuals form a social contract with the state so that responsibility of citizens of the state is entrusted with the government. Thus the people are the source of the collective political sovereignty of the state. Thus the government was performing the functions of the common people after undergoing a

G-III Apparel Group Inc IPO Valuation Case Study

G-III Apparel Group Inc IPO Valuation - Case Study Example The growth looks impressive, but the firm should not expect that type of continuous growth since in the apparel industry prolonged above average growth is rare. The company operates in a fragmented industry, but its 10% market share is relative large which gives the firm a competitive advantage. The company is perfectly positioned to achieve further growth by utilizing an acquisitions strategy. A positive aspect of the IPO plans of the firm is that company plans on reducing its long term and short term obligations from $22.3 million to $6.4 million. This strategic move is very wise because the firm is reducing its fixed costs by lowering its total debt. The organization has a workforce composed of 235 employees. G-III generated in 1989 total sales of $98.78 million. A strategy that has helped the company generate revenues at different price points is the use of multiple brands. Three of the brands the firm owns are G-III, Siena, and Cayenne. 6. Who is Oppenheimer? What was the role o f Oppenheimer in the process? Was Oppenheimer’s role commensurate with its fees? Oppenheimer is the firm that handled the IPO. The person from Oppenheimer that was in charge of the IPO was Richard White. The IPO process began in September 1989 and it was completed three months later on December of 1989. The stock of G-III following the IPO was going to be traded in NASDAQ. The underwriter price obtained by Oppenheimer was $0.91per share. I believe the fees that Oppenheimer negotiated were reasonable. The $0.91 per share price was equivalent to a 7% commission. 7. Was $13 an appropriate price for G-III? What was the intrinsic value of a share of G-III? The intrinsic value of a stock can be defined as the actual value of the firm which may be different that the market value of the shares of a company. There are several metrics that can help an investor determine the intrinsic value of a company. The book value of G-III can be calculated by subtracting total debt from total asse ts (Little). Prior to the IPO the book value of the company was $18,923,000. The book value per share of the company was $4.07 (18923000 / 4644144). The market to book ratio assuming the $13 price is the market price was $3.19. The earnings per share of the firm in 1989 was $1.28. The price earnings ratio is calculated dividing the market price of the company by its EPS (Garrison & Noreen). Based on the $13 IPO price the price-earnings ratio of the company is $10.15. Due to the intrinsic value of the company I believe that the firm got a good deal by selling the stocks at $13, since this price is three times higher than the book value of the firm. 8. How would picking the wrong comparables influence estimates? Choosing the wrong comparable can distort the information which can lead to making bad decisions in regards to the valuation of G-III. One of the problems the company faced when it was choosing comparables was that most companies in this niche industry were not public which ma de it hard to find information regarding the industry financial performance norm. The problem with choosing wrong comparables is that it can undervalue or overvalue a firm. If the analysis undervalues the firm the company would be selling the stock at too cheap of a price. An overvaluation could hurt the company because investors might not be willing to buy at the high price which could lead to disastrous results in the IPO. 12. Did G-III display