Case Study – Corporate Governance

Case Study – Corporate Governance

The report ‘COVID-19; Implications for Business’ by Ellingrud and Kelly dives into how firms might use COVID-19 recovery to undertake sustainable activities. Given the devastating effects left behind by the COVID-19 pandemic, businesses can improve community prosperity by actively pursuing sustainable initiatives. Active participation, referred to in this case, includes capitation, infrastructure development, rewarding change, and training. This essay discusses the key takeaway from the report, which includes businesses’ roles in ensuring inclusive and sustainable growth, the need for CSR, supply chain management during a crisis, and the need for businesses to prioritize cybersecurity.

Roles of Businesses in Ensuring Inclusive and Sustainable Growth

One of the significant takeaways from the report is the role businesses can play in ensuring sustainable and inclusive growth for all. Sustainable and inclusive growth is crucial since it will ensure countries have enough resources to address the most pressing social and economic problems (McLaughlin, 2022). Some of the identified challenges and needs include curbing greenhouse gas emissions that cause global warming, reducing child mortality rates, increasing life expectancy, and reducing the gender parity gap, among other needs. Since large businesses have a combined GDP that accounts for 70% of the global GDP, businesses are better positioned to lead the push for such changes.

Ellingrud and Kelly recommend some actions that will go a long way to ensure sustainable and inclusive growth. First, businesses should provide financing and technologies that facilitate lithium production (McLaughlin, 2022). Lithium is a crucial component in the manufacture of electric vehicle batteries. The journey to zero greenhouse gas emissions will be possible once large corporations have the resources and technologies required to facilitate lithium mining. Also, investment in healthcare will go a long way to curbing the child mortality rate and increasing life expectancy.

The Business Case for CSR

The report also presents a business justification for why companies should participate in corporate social responsibility. Whereas it may be seen that businesses can only benefit from profits raised in markets, there is more than profits businesses can look forward to by participating in social responsibility. Global bodies such as UN agencies are no longer actively pushing for people’s interests, and some governments do not have sufficient resources for such (Hopkins, 2004). As a result, consumers and the public globally expect businesses to implement CSR activities. Businesses stand to benefit from participating in CSR.

McLaughlin (2022) states that businesses can leverage social responsibility to bolster their portfolio. For instance, the Ukraine-Russia crisis has resulted in a big refugee situation calling for attention from large corporations. The refugee crisis is expected to result in about ten to fifteen million displaced people. As a result, large corporations should intervene to save face and improve people’s welfare. Such an action will go a long way to enhance the company’s brand equity. Besides, businesses need to learn from businesses like Amazon to develop solutions to supply chain challenges that may have prevented them from fulfilling consumer needs (McLaughlin, 2022). Also, car manufacturers can take advantage of emerging electric vehicle technology to position themselves strategically and benefit from the industry in the future. This shows that businesses can still profiteer while pursuing corporate social responsibility.

Supply Chain Management During Crisis

The report also delves into the impact of supply chain interruptions caused by the COVID-19 pandemic, followed by the Ukraine-Russia war. Global crises pose serious threats to business operations, especially in this globalized era. The COVID-19 pandemic led to the closing of borders, interrupting supply chains and logistics. The main reason why most companies were unable to operate fully is because they lacked alternative processes and structures (Milicevic, 2023). Therefore, the two crises offered useful lessons that businesses can pursue to remain operational during such crises in the future.

One of the changes that businesses should adopt is to ensure they have an online architecture to facilitate online purchases. During the COVID-19 pandemic, online sales across businesses that had the system before the onset of the crisis increased significantly. With the cross-border e-commerce merchandise expected to hit $ 1 trillion from the current value of $300 billion, more businesses should invest in e-commerce for sustainability (McLaughlin, 2022).

Cybersecurity as a Priority for Businesses

The need to invest in cybersecurity was also reinforced during the COVID-19 pandemic. Most people stayed indoors during the COVID-19 period, leading to some cyber attackers taking advantage to test their craft. Therefore, as cyberattacks grow, many companies need to understand the need for cybersecurity protection (de Bruijn & Janssen, 2017). An easy and inexpensive way firms may defend themselves against cyberattacks is by reducing redundant, obsolete, and trivial (ROT) data from their systems.

Conclusion

In summary, the McKinsey report by McLaughlin emphasizes the need for businesses to actively participate in ensuring sustainability and societal well-being. One of the roles businesses should play is actively ensuring inclusive and sustainable growth, especially in reducing greenhouse gas emissions and improving overall healthcare. Active participation will require businesses to provide funding, training, and technologies required. The report further indicates that businesses stand to benefit by actively pursuing sustainable initiatives. For instance, motor vehicle companies can prepare themselves for the expected increase in the demand for electric motor vehicles. The report also touches on the impact of global crises on business supply chains and logistics in the globalized era. The best way to avoid business disruption during such crises is to maintain alternative systems and structures. Finally, the report delves into the need for businesses to avoid cyberattacks by employing ideal policies, including the reduction of redundant, obsolete, and trivial data.

Reference

de Bruijn, H., & Janssen, M. (2017). Building cybersecurity awareness: The need for evidence-based framing strategies. Government Information Quarterly, 34(1), 1-7.

Hopkins, M. (2004). Corporate social responsibility: an issues paper Michael Hopkins Policy Integration Department World Commission on the Social Dimension of Globalization International Labour Office Geneva. http://oit.org/wcmsp5/groups/public/—dgreports/—integration/documents/publication/wcms_079130.pdf

McLaughlin, K. (2022, April 13). Coronavirus’ Business impact: Evolving Perspective | McKinsey. Www.mckinsey.com; McKinsey & Company. https://www.mckinsey.com/capabilities/risk-and-resilience/our-insights/covid-19-implications-for-business

Milicevic, S. (2023)  Impact Of Global Crisis On Supply Chain Management Quality: Case Studies.

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The pandemic has changed the way organizations view strategy. Please click on the link and read the report
https://www.mckinsey.com/capabilities/risk-and-resilience/our-insights/covid-19-implications-for-business
The report covers a large scope of governance. What are the four points that caught your attention and why?
Please explain in detail any four points that caught your attention from the report. While working on this assignment, it is important to critically think through from the lens of leadership and strategist.

Feel free to use other sources of information to support your synthesis and cite all work.