MNG 3701 MANUAL
1ST SEMESTER 2018
LECTURER: Lynne Addison
UNIT 6
SUSTAINABLE ORGANISATIONS
,LEARNING UNIT 6: SUSTAINABLE ORGANISATIONS
You will be expected on completion of this learning unit, you should be able to
critically evaluate the sustainability of strategic decision-making in an
organisation. More specifically, you should be able to:
• define corporate sustainability and explain its relevance
• identify the four pillars of corporate sustainability
• explain what the “triplebottom line” is and why it is important
• critically evaluate sustainable development in a practical setting.
• explain the concept corporate social responsibility (CSR) and
provide examples of CSR activities in a company
• explain the importance of stakeholders and stakeholder
management to
sustainable business
conduct an analysis of stakeholder salience and make
recommendations based on your analysis the importance of ethical
business and give examples of what organisations can do to promote
it
• explain the role of corporate governance in corporate sustainability
• evaluate corporate sustainability in a practical setting
• make recommendations on how organisations can improve their
sustainability
6.3 INTRODUCTION (SG 146)
The study guide points out that after studying this section, you
should be able to define corporate sustainability and explain its
relevance
identify the four pillars of corporate sustainability
The term “sustainability” is used everywhere these days and in
many different contexts, to the extent that it could qualify as a
“buzzword”. In general terms, it refers to the ability to endure and
continue over a long period of time.
Thus, if we talk about business or organisational sustainability, we
are referring to the ability of the organisation to endure and survive
in the long run. There are many examples of
organisations that have managed to do this successfully and are still
performing well.
Note the following examples:
SABMiller (formerly South African Breweries) was founded
in 1895.
, The University of South Africa (Unisa) was founded in 1873
(as the University
of the Cape of Good Hope).
Nestle was founded in 1866 in Vevey, Switzerland.
Coca-Cola was founded in 1886 in Atlanta in the United
States of America.
Do activity 6.1
Activity 6.1 (sudy guide page 147)
Read the extract below and answer the questions that follow.
Bankrupt South African public institutions
(1) Athletics South Africa (ASA)
ASA is under administration again. The man put in charge, Zola Majavu − who quit in
June 2013 − stated that the federation was effectively bankrupt and that "if ASA were
a business, we would be put under business rescue". "We are trading recklessly and we
don’t have sufficient liquidity," he said.
Among other debtors, it owes R1,6m to the South African Revenue Service (SARS). It
has about R300 000 due in outstanding payments to Soweto Marathon winners and has
been unable to pay its staff a 13th cheque.
Meanwhile, the Minister of Sport has acknowledged that ASA "does not have a high-
performance programme in place to support elite athletes in preparation for the 2016
Summer Olympics in Rio de Janeiro" − indeed, that it does not even have a strategic
plan for this term, never mind the Olympics.
(2) African National Congress (ANC) Youth League
Facing a South Gauteng High Court application for the liquidation of the league, ANC
secretary-general, GwedeMantashe, revealed it had neither the money nor the assets to
cover R15 million worth of lawsuits brought against the organisation, most of which
stem from outstanding payments to caterers for its chaotic 2008 conference.
The situation is so dire that when the sheriff tried to attach the youth league’s assets,
there were none to be found. The league itself has acknowledged the debt runs into the
tens of millions of rand. League member, MagaselaMzobe, said of the problem: "We
are getting letters (of demand) every week; to date it’s about R50m."
(3) Limpopo province
A single institution going bankrupt is one thing, an entire province quite another.
Nevertheless, in early 2012, the Treasury declared this entire province "technically
bankrupt" and placed it under the administration of a national task team. Limpopo faced
a R2.7 billion shortfall in revenue at the time.
Contributing factors included out-of-control official spending, a lack of supporting
documentation for purchases (specifically on contracts that could not be verified) and
procurement that was severely undermined by rampant corruption and nepotism as
well-connected ANC Youth League members and "tenderpreneurs" benefiting from
irregular state contracts.
1ST SEMESTER 2018
LECTURER: Lynne Addison
UNIT 6
SUSTAINABLE ORGANISATIONS
,LEARNING UNIT 6: SUSTAINABLE ORGANISATIONS
You will be expected on completion of this learning unit, you should be able to
critically evaluate the sustainability of strategic decision-making in an
organisation. More specifically, you should be able to:
• define corporate sustainability and explain its relevance
• identify the four pillars of corporate sustainability
• explain what the “triplebottom line” is and why it is important
• critically evaluate sustainable development in a practical setting.
• explain the concept corporate social responsibility (CSR) and
provide examples of CSR activities in a company
• explain the importance of stakeholders and stakeholder
management to
sustainable business
conduct an analysis of stakeholder salience and make
recommendations based on your analysis the importance of ethical
business and give examples of what organisations can do to promote
it
• explain the role of corporate governance in corporate sustainability
• evaluate corporate sustainability in a practical setting
• make recommendations on how organisations can improve their
sustainability
6.3 INTRODUCTION (SG 146)
The study guide points out that after studying this section, you
should be able to define corporate sustainability and explain its
relevance
identify the four pillars of corporate sustainability
The term “sustainability” is used everywhere these days and in
many different contexts, to the extent that it could qualify as a
“buzzword”. In general terms, it refers to the ability to endure and
continue over a long period of time.
Thus, if we talk about business or organisational sustainability, we
are referring to the ability of the organisation to endure and survive
in the long run. There are many examples of
organisations that have managed to do this successfully and are still
performing well.
Note the following examples:
SABMiller (formerly South African Breweries) was founded
in 1895.
, The University of South Africa (Unisa) was founded in 1873
(as the University
of the Cape of Good Hope).
Nestle was founded in 1866 in Vevey, Switzerland.
Coca-Cola was founded in 1886 in Atlanta in the United
States of America.
Do activity 6.1
Activity 6.1 (sudy guide page 147)
Read the extract below and answer the questions that follow.
Bankrupt South African public institutions
(1) Athletics South Africa (ASA)
ASA is under administration again. The man put in charge, Zola Majavu − who quit in
June 2013 − stated that the federation was effectively bankrupt and that "if ASA were
a business, we would be put under business rescue". "We are trading recklessly and we
don’t have sufficient liquidity," he said.
Among other debtors, it owes R1,6m to the South African Revenue Service (SARS). It
has about R300 000 due in outstanding payments to Soweto Marathon winners and has
been unable to pay its staff a 13th cheque.
Meanwhile, the Minister of Sport has acknowledged that ASA "does not have a high-
performance programme in place to support elite athletes in preparation for the 2016
Summer Olympics in Rio de Janeiro" − indeed, that it does not even have a strategic
plan for this term, never mind the Olympics.
(2) African National Congress (ANC) Youth League
Facing a South Gauteng High Court application for the liquidation of the league, ANC
secretary-general, GwedeMantashe, revealed it had neither the money nor the assets to
cover R15 million worth of lawsuits brought against the organisation, most of which
stem from outstanding payments to caterers for its chaotic 2008 conference.
The situation is so dire that when the sheriff tried to attach the youth league’s assets,
there were none to be found. The league itself has acknowledged the debt runs into the
tens of millions of rand. League member, MagaselaMzobe, said of the problem: "We
are getting letters (of demand) every week; to date it’s about R50m."
(3) Limpopo province
A single institution going bankrupt is one thing, an entire province quite another.
Nevertheless, in early 2012, the Treasury declared this entire province "technically
bankrupt" and placed it under the administration of a national task team. Limpopo faced
a R2.7 billion shortfall in revenue at the time.
Contributing factors included out-of-control official spending, a lack of supporting
documentation for purchases (specifically on contracts that could not be verified) and
procurement that was severely undermined by rampant corruption and nepotism as
well-connected ANC Youth League members and "tenderpreneurs" benefiting from
irregular state contracts.
