Deck 10: Sustainable Business

Question 1

_____________ ____________ ________________ highlights problems that have arisen, or are perceived to have arisen, from the commercial activities of businesses.

Answer 1

Corporate social responsibility

Question 2

The __________ __________ ________ takes into account the economic, environmental and social value added and destroyed as a result of business activities.

Answer 2

triple bottom line

Question 3

To be _____________ a business has to be profitable or, in the case of not-for-profit organisations, financially self-sustaining.

Answer 3

sustainable

Question 4

________________performance measures the amount of energy consumed, its origin, (electricity, gas, diesel, fuel), raw materials usage, greenhouse gas emissions, effluent and waste, as well as land use and the management of natural habitats and ecosystems impacted by business.

Question 5

____________________ occurs when a business spends considerable time and money emphasising its green credentials through marketing and advertising, when in fact it does not actually implement business practices that reduce environmental impacts.

Question 6

____________________ performance addresses interactions between business and the community.

Question 7

The three components of the triple bottom line should be integrated into the business' operations, with each having _____________ status.

Question 8

_________________ reporting can be part of a business' annual report, a stand-alone sustainability report, such as a triple bottom line report or an environmental or social impact report.

Question 9

Society is demanding more ________________ environmental standards and greater levels of corporate social responsibility.

Question 10

The ________________ ___________ _____________ framework is intended to serve as a generally accepted framework for reporting on an organisation's economic, environment and social performance.

Question 11

Sustainability reporting frameworks such as the GRI are underpinned by a range of _______________ ____________ _______________ techniques for quantifying and measuring sustainability performance. One of the more involved techniques is life cycle analysis.

Question 12

A key part of business ______________ is understanding how products and services impact on the environment.

Question 13

A key part of life cycle analysis is ______________ ______ ______ ______________, allowing a business to trace input materials that flow through production processes, and measure the output of those production processes in terms of finished products and waste.

Question 14

____________________ is a management concept that encourages managers to investigate environmental improvements to business that also provide parallel financial benefits.

Question 15

The eco-efficiency ratio can be calculated by taking the product or service value and dividing it by the ___________________ ________________.

Question 16

Eco-efficiency can be increased by providing more ______________ with a decrease in the environmental impact or resource consumed for a given product or service.

Question 17

A business with good eco-efficiency ratios is not necessarily ____________________.

Question 18

The recycling rate can be calculated as the quantity of recycled waste in tonnes _____________ by the quantity of total waste in tonnes.

Question 19

The __________________ ___________ is the value today of a certain amount of dollars paid or received in the future.

Question 20

The _________________ ______ ____ _________ on an investment is the minimum return required by investors on the amount invested.

Question 21

Social accounting attempts to put a _________________ _______________ on the costs and benefits of a business' activities in relation to both society and the environment.

Question 22

_________________ _______________ refers to the idea that development to meet the needs of the present should not compromise the ability of future generations to meet their needs.

Question 23

From a business perspective, strategic planning is about making better _________________ decisions for long term prosperity and sustainability.

Question 24

Corporate social responsibility does not take into account financial or economic considerations.

Question 25

Triple bottom line consists of economic, environmental and social impacts of business activity.

Question 26

Sustainability accounting is an accounting practice which seeks to ensure the financial aspects of the financial accounts are sustainable.

Question 27

A business does not have to be profitable, or in the case of not-for-profit organisations, be financially self-sustaining, in order to survive in today's business world.

Question 28

Environmental performance includes the amount of energy consumed, its origin, financial cost to shareholders and the amount of the extra dividends payable to shareholders as a result.

Question 29

There are increasing expectations among stakeholders for businesses to be 'green'.

Question 30

Greenwashing occurs when a business spends considerable time and money emphasising its green credentials through marketing and advertising.

Question 31

Social performance addresses interactions between business and the community, including issues such as human resource management, workplace health and safety, community involvement initiatives and customer and stakeholder satisfaction.

Question 32

Sustainability reporting involves preparation of a stand-alone report to be submitted to the government.

Question 33

There are no legal obligations regarding sustainability reporting in Australia.

Question 34

The Global Reporting Initiative framework takes into account the practical considerations faced by a diverse range of organisations from small enterprises to those with extensive and geographically dispersed operations.

Question 35

The Global Reporting Initiative is continually being updated and improved through a process of consensus.

Question 36

A key part of business sustainability is understanding how products and services impact on the environment.

Question 37

Decisions which are based on capital costs alone may not include resource-efficiency improvements or reductions in business risk that may provide a more stable return.

Question 38

Since capital expenditure decisions involve cash payments and cash receipts occurring at different times, often over several years, a manager must consider the time value of money in sustainability-related decisions.

Question 39

The present value is the value today (year 0) of a certain amount of dollars paid or received in the future.

Question 40

The required rate of return on an investment is the maximum return required by investors on the amount invested.

Question 41

A well-written business plan against which performance is measured regularly is a key characteristic of a sustainable business.

Question 42

Long term strategic planning for business sustainability is perhaps the primary challenge facing business managers in the world today.

Question 43

Social cost benefit analysis is a technique for evaluating the benefits and costs of a business investment or planned business activity in order to determine if the benefits outweigh the costs.

Question 44

Which of the following reflects the sustainability element of the 'triple bottom line'?

A) revenue, gross profit, net profit.
B) decrease cost, increase value, improve cash collection.
C) profitability, social accountability, environmental sensitivity.
D) reduce inventory, reduce employees, reduce overheads.

Question 45

Which of the following ratios would NOT be considered to be a measure of a business' economic performance?

A) Return on assets
B) Inventory days
C) Return on equity
D) Sales growth

Question 46

Which of the following would NOT be considered to be part of a business' environmental performance?

A) the amount of energy consumed.
B) raw material usage.
C) the number of customers.
D) the amount of effluent and waste.

Question 47

What is the term for a business that states that it is applying green practices but in reality isn't?

A) Greenwashing
B) Stonewashing
C) Stonewalling
D) Green screening

Question 48

In 1999 an index was launched to track the performance of the world's leading companies in terms of their economic, environmental and social criteria. The index is:

A) the NASDAQ Sustainability Index.
B) the FTSE Sustainability Index.
C) the Global Sustainability Index.
D) the Dow Jones Sustainability Index.

Question 49

Which of the following is NOT a reason why businesses should choose to prepare sustainability reports?

A) Responding to the demands of stakeholders.
B) Informing shareholders and the market about how well the business is managing non-financial and financial risks.
C) A requirement to report performance and strategies to improve social and environmental impacts.
D) Covering up environmental hazards.

Question 50

GRI stands for:

A) gross revenue indicator.
B) gross revenue index.
C) global reporting initiative.
D) global reporting index.

Question 51

GRI reporting can be undertaken by business at three levels:

A) beginners, advanced and somewhere in between.
B) levels 1, 2 and 3.
C) tiers 1,2 and 3.
D) beginners, intermediate and expert.

Question 52

When related to a product, life cycle analysis is sometimes referred to as:

A) cradle to grave.
B) womb to tomb.
C) cradle to cradle.
D) womb to cradle.

Question 53

Which of the following is NOT one of the five stages in a product's life cycle?

A) Raw material extraction and processing
B) Product design and manufacturing
C) Customer demand
D) End of product's life

Question 54

The material cost flow accounting (MCFA) system allows a business to:

A) value its inventory more accurately.
B) trace input materials that flow through production processes, and measure the output of those production processes in terms of finished product and waste.
C) have real-time information about how much inventory is available for sale.
D) Match costs more accurately with inventory flows.

Question 55

Which of the following is one of the broad objectives of eco-efficiency?

A) Sell more products to customers.
B) Reduce the costs of production.
C) Reduce the consumption of resources.
D) Reduce the selling price of a product or service.

Question 56

The eco-efficiency ratio is measured by the product or service value divided by:

A) the environmental influence.
B) the amount of resources consumed.
C) the sales value of the product or service.
D) the cost to produce the product or service.

Question 57

The payback period is:

A) the period in which a business has to pay for an investment.
B) the length of time required for a return of the initial investment.
C) the period of credit allowed by the supplier.
D) the time from placing an order until the investment produces revenue.

Question 58

The minimum return required by investors is known as:

A) the payback period.
B) a dividend.
C) the yield.
D) the required rate of return.

Question 59

The concept that seeks to place a value on the impact of business operations on society is known as:

A) current accounting.
B) net present value.
C) social accounting.
D) historical cost accounting.

Question 60

Which of the following is a technique for evaluating the benefits and costs of a business investment or planned business activity in order to determine if the benefits outweigh the costs?

A) social cost benefit analysis.
B) net present value.
C) social accounting.
D) payback period.

Question 61

Intergenerational equity refers to:

A) wealth being passed from generation to generation.
B) owner's equity increasing over the lifetime of a business.
C) the idea that development to meet the needs of the present should not compromise the needs of future generations.
D) future value of owner's equity.

Question 62

What are the three components of the 'triple bottom line'? Is one component more important than the others?

Question 63

Briefly outline the types of actions a company should take if it is to be deemed 'socially
responsible'.

Question 64

Do the reporting responsibilities of business extend beyond the reporting of financial information to its owners?

Question 65

List six ways in which businesses can enhance their corporate social responsibility. Provide an example for each choice.

Question 66

What is the time value of money? How is the time value of money applied in net present value (NPV) method of project appraisal?

Question 67

How does the net present value (NPV) indicate a project is not financially viable?

Question 68

What is social accounting?

Question 69

What is social cost benefit analysis?

Question 70

Briefly describe intergenerational equity?

Question 71

What are the characteristics of sustainable business?

Question 72

How does sustainable development reporting differ from triple bottom line reporting?

Question 73

Conduct some research into how businesses have generally responded to the environmental and social pressures to enhance their sustainability development. You should identify at least three different responses.