, MAC2602 ASSIGNMENT 1 SEMESTER 2 2026 - DUE DATE SEPTEMBER 2026
PART A
(A1) Eight ESG factors
1. Economic – Rising operating costs: Municipal property taxes increase by 6% in Year 2
and 8% in Year 3, increasing PG’s costs and reducing profits.
2. Economic – Financing risk: The facility is fully debt-financed at 11% interest, increasing
PG’s financial risk and repayment obligations.
3. Social – Employment: PG prioritises local people for in-service training, supporting
employment and skills development.
4. Social – Labour relations: Unions have raised concerns about contractors employing
illegal immigrants, creating potential labour disputes and reputational risk.
5. Environmental – Environmental footprint: PG’s mills and plants face environmental
challenges, which may increase compliance and operating costs.
6. Environmental – Environmental assessment: PG conducted an environmental assessment
before acquisition to identify possible environmental risks and liabilities.
7. Governance – Due diligence: External legal due diligence was performed to identify risks
before investing, supporting proper corporate governance.
8. Governance – Legal and tax compliance: PG must comply with SARS, labour and
environmental requirements to avoid penalties and reputational damage.
(A2) NPV
Municipal rates
PART A
(A1) Eight ESG factors
1. Economic – Rising operating costs: Municipal property taxes increase by 6% in Year 2
and 8% in Year 3, increasing PG’s costs and reducing profits.
2. Economic – Financing risk: The facility is fully debt-financed at 11% interest, increasing
PG’s financial risk and repayment obligations.
3. Social – Employment: PG prioritises local people for in-service training, supporting
employment and skills development.
4. Social – Labour relations: Unions have raised concerns about contractors employing
illegal immigrants, creating potential labour disputes and reputational risk.
5. Environmental – Environmental footprint: PG’s mills and plants face environmental
challenges, which may increase compliance and operating costs.
6. Environmental – Environmental assessment: PG conducted an environmental assessment
before acquisition to identify possible environmental risks and liabilities.
7. Governance – Due diligence: External legal due diligence was performed to identify risks
before investing, supporting proper corporate governance.
8. Governance – Legal and tax compliance: PG must comply with SARS, labour and
environmental requirements to avoid penalties and reputational damage.
(A2) NPV
Municipal rates
