In the present environment organisation are required to meet their responsibilities related with the legal, economical and ethical consideration that support them to sustain in the industry. Corporate responsibility is the key approach or practice that mainly involves activities that support the community and their shareholders (Walker-Said and Kelly, 2015). For the present report, the selected organisation is Sports Direct Company leading British retailer that deals in offering the products related to sports goods. Along with this report will gain the current proposition of an organisation to corporate governance. While, it also critically appraises the system and processes of an organisation so that they can manage the business ethics.
(a) Current approach to corporate governance and the UK governance code
Sports Direct Company one of the leading UK retailer that deals in offering the range of products related to sports, fitness, fashion, etc. the cited firm mainly concentrate on the corporate responsibility practices through focusing on areas that us people, health and safety, environment, customers and community (Kamal and El-Masry, 2016). Corporate governance is an effective mechanism as well as the system of practices through which the company is directed and controlled by their directors. It also includes levelling of the interest of different stakeholders so that they may satisfy their requirement. To present corporate responsibility UK government has focused on framing the governance structure with the code and regulation whose key aim is to facilitate the activities related to effective management within the organisation that can easily attain the long terms success (Hillenbrand, Money and Ghobadian, 2013). UK government has focused on the key principles of code that need to be implied within the organisation that would properly engage in the governance activities.
The foremost principle within the corporate governance includes leadership that is company must be directed by the effective board that have their clear section of their responsibilities that need to be followed (Denis, 2016). So, that company may easily attain the long-term success in the retail marketplace. Accordant with this principle of leadership, the current approach to corporate governance within Sports Direct Company, ensure effective board that consists of a chairman and different executive directors. Whose key responsibility is to ensure delegation of leadership to the management so that they may engage in the operating the daily activities that support in leading the group (Claessens and Yurtoglu, 2013).
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Another code that is framed by the UK corporate governance includes effectiveness that ensures board of the company must engage in balancing their skills and knowledge that support them delegating effective duties and responsibilities (Bushee, Carter and Gerakos, 2013). It has been critically evaluating that to ensure effectiveness within the Sports Direct Company they must establish the audit committee that engages in reviewing that ethical standard has been followed in the company or not. Along with this it also ensures effectiveness through engaging in the external audit process.
In addition to this, another principle within the UK governance code include accountability this section ensure that board must focus on establishing the transparent and formal arrangements through which they can implement the provision related to corporate reporting as well as risk management so that they may easily achieve the strategic objectives (Larcker and Tayan, 2015). In order to meet the principle of accountability within the Sports Direct Company, board focuses on implementing the financial reporting process that prepares the unit account so that it may meet the interest of the stakeholders.
Another section of the UK governance code includes engaging in designing proper remuneration system by the executive directors so that they may easily promote the success of a company in the long run (Weiss, 2014). Therefore, the government has also stated that performance related elements and components must be kept transparent so that other stakeholders may not get demotivated. Therefore, to meet this code related to the governance executive directors within the organisation must engage in constructing the provocative activities related to management of performance as well as it also engage in setting the remuneration levels so that they may easily satisfy their stakeholders (Quarshie, Salmi and Leuschner, 2016). To ensure providing proper remuneration to staff and employees the board within the company is assisted with principle committees that also include establishing remuneration committee that conduct meetings with members so that effective decision regarding the remuneration is made (EVERYTHING IS CHANGING, 2017).
The last principle within the UK governance code includes engaging in the proper relationship with all their shareholders so that they may accomplish their interests (Hwang and Chung, 2016). This principle within the corporate governance includes that board must have effective communication with their shareholders regarding the understanding of goals and objectives. It has been required that to ensure the proper relationship with shareholders they must conduct the meeting with their shareholders and investors that support in active participation. It has been assessed that the current corporate governance within the Sports Direct Company has recognised the significance of communication among their different shareholders (Paulraj, Chen and Blome, 2015). Therefore, it may be done through providing the annual reports to all of their investors and shareholders. To make effective relation management within the sports, company engage in conducting the meeting with their shareholders and all executives staff that support in discussing their problems and queries.
Therefore, the group within Sports Direct Company has been formulated that is mainly committed to the high standard of corporate governance within the premises so that activities may be effectively directed and controlled (Walker-Said and Kelly, 2015). The key responsibility of the group within the company is that all the members and systems incorporate within the board. It is an ongoing procedure that mainly engages in the activities related to determining, measuring as well as monitoring of the certain risks. Thus, the company complies with the different corporate governance code that is framed by the UK government.
(b) The organisation system and processes for its management of business ethics
Business ethics refers ethics principles and morality for doing business. It applied to many aspects of the business which conducts for the individual and entire organisation (Kamal and El-Masry, 2016). These ethics guide to the company what is right and what is wrong.
To successfully engage in meeting the corporate responsibility, organisation need to ensure proper management of business ethics that considers the view point related with activities. It has been critically appraising that there are different systems and processes within the organisation that need to ensure ethical activities so that they may easily accomplish the interest of the stakeholder (Hillenbrand, Money and Ghobadian, 2013). The key process within the Sports Direct Company includes procurement of material and sports products that required to be delivered to the different customers. Therefore, this process focuses on ethical practices as the company procure the sports merchandise with the manufacturer within the community that upholds or implement the ethical practices related to delivering the quality sports products to the company. Along with eliminating the defective product from the packaging process etc. (Denis, 2016). In addition to this, it has been critically evaluated that organisation process has key responsibility in managing their activities in such a manner that it may not impact the environment where the company operates their operation. Thus for managing the ethics while procuring the material company may use the effective transportation system that may reduce the carbon emission rate. This effective practice would protect the environment and also ensure proper management of transportation (Claessens and Yurtoglu, 2013).
On the contrary to this, it has been critically evaluated that organisation process does not engage in the effective trading practices as they offer the product to their customers at the varies prices. Thus, this trading practices within the organisation consider as the unethical practice that impacts the impact or performance of the organisation (Bushee, Carter and Gerakos, 2013).
Along with this, for retailing the range of sports product in the market company also engage in the online activities as with the help of this they can easily distribute and supply products to the customers (Larcker and Tayan, 2015). To manage the online activities of Sports Direct, company management needs to ensure activities that support the ethics within the business. For instance, ethics in online distributing of sports product ensure that it focuses on the security and privacy of the customer personal information to ensure satisfaction and build trust among them regarding the company products. On the other hand, Larcker and Tayan (2015) has stated that company do not engage in implementing different layer while making the online purchasing. Therefore, it may sometimes result in conducting the wrong and unethical practices that impact the perception of customers related to online shopping. In addition to this, it has been stated that increasing growth of online shopping among the individual faces certain ethical issues related to their privacy and security (Ethical Issues in E-Commerce on the Basis of Online Retailing, 2011). It has ben also measured that with the increasing online activities and communication it increases the level of their services along with this also reduces the overall cost associated with the printing that results in addressing their income in a proper manner. Therefore, for the management of business ethics in this process, they must engage in the activities that result in protecting and securing the information of customers.
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Another effective system within the Sports Direct Company includes that company have effective supply chain management as they are committed to engaging in effective business practices. Therefore, the cited sports retailer company ensure effective code of conduct practices that they insist all of their suppliers may adhere this to ensure ethical practices. From the viewpoint of Claessens and Yurtoglu (2013) implementing the code of conduct or rules within the company, all enable the staff to be treated equally and fairly as well as it also eliminates the illegal activities related to producing and supplying the sports products to the customers (Claessens and Yurtoglu, 2013). Along with this, the cited retailer company also focuses on maintaining relations with their suppliers as they engage in adhering the Sports Direct's standards through which company ensure that goods and merchandise meet the standard of quality. In addition to this Hwang and Chung (2016) has also stated that for the management of business ethics in the supply chain management system company conduct the tests on the fabric and material that has been taken for the products (Hwang and Chung, 2016)
Along with this, the organisation system also includes their centralised commercial as well as different supporting function through which they can easily retail their sports products among different customers (Paulraj, Chen and Blome, 2015). Therefore, it supports the company in engaging in effective operational activities related to warehousing of sports products so that it may accomplish the requirement of the different customers. In addition to this, the establishes committee within the Sports Direct Company also engage in the ethical activities through providing opportunities related with inspiring, motivating and empowering the staff within the company so that they may easily assist in accomplishing the gaols and objectives. The company also ensure proper commitment among the staff through engaging constant developing and rewarding them within the premises (Walker-Said and Kelly, 2015). Therefore, all these ethical practices related to employment assist in enhancing the level of commitment towards the organisation that directly accomplish in achieving desirable growth. With the help of all this activities company can easily engage in the management of their ethical activities that support in accomplishing their responsibilities and duties towards the organisation as well as an environment in which they are operating their operations. Along with this, it would also positively impact in meeting their responsibilities related with the social and economical that directly enhance their performance and image in the environment (Paulraj, Chen and Blome, 2015).
From the above report, it has been concluded that company need to focus on accomplishing the social responsibilities that assist them to sustain in the community. Along with this, it also assists the Sports Direct Company to engage in the ethical practices that enhance their image within the industry. Along with this, the report also measures the current corporate governance structure that organisation follows to engage in the ethical practices.
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