Answer the following questions:
Background Information: The board adopts a sustainability approach to viewing its performance and uses the following key performance indicators to assess company performance WealthWise Insurance has recently set up an internal information system to improve f social and environmental practices within the company. The company has its head office in Brisbane and offices in all capital cities and every regional city with a population of more than 50 000 people. One of the underlying principles of the company is to be socially and environmentally responsible. This principle has been in place for many years, dating back to the firm's founder, Jeannette Dai, who felt that she would like to contribute to society rather than simply maximising profits Financial indicators Net proft Gross insurance premiums Retum on inwestment Economic indicators Policy, practices and spending cn local suppliers Procedures for hiring local staff. Development projects primarily for public benefit. The company is a major contributor to charities, particularly those that focus on the homeless and the poor. It actively promotes environmental management in all of the company operations. t sponsors a program that provides scholarship to disadvantaged students to allow them to attend university, and it is proud to offer employment in the company to long-term unemployed and the poor. Each yea Social indicators: publishes a sustainability report that summarises its achievements across each area of performance Employee satisfaction ratings. Percentage of women in the lop three tiers of management. Number of ncigenous employees. Over time these activities have become a marketing strength of WealthWise. The social and environmental stance taken by the company has attracted many customers to the company. Listed on the Australian Stock Exchange in 2001, the company has also become a preferred stock of ethical and green investment funds Customers' ethical ranking of sales staff Number of staff hired who were previously uremployed teenagers. Tonnes of paper recycled per annum. Litres of fuel per collar ol sales. Environmental indicators The mission statement of WealthWise states that it will aim to: Percentage reduction in electricity usage. Support employees in achieving their personal and career goals Act in a socially responsible way when dealing with insurance clients and the general community Promote a better social and physical environment for the world Required However, the current chief executive officer, Sylvia Trott, thinks that the firm has 1. Explain what is meant by sustainability reporting and why a publicly Isted become complacent and is resting on its past achievements. She is concerned that the firm has built up a reputation for good social and environmental practices but is not walking the talk'. There is some level of discontent among employees about the way 2. Consider the list of key performance indicalors used by WealthWise. Explain how that management treats staff, and this is impacting on employee satisfaction. There have also been negative reports in the media of its treatment of businesses in Phuket and Langkawi that were damaged in the December 2004 tsunami. The reports claim that the company has tried to minimise the amounts paid to these businesses by strictly applying clauses in the insurance contracts that cover earthquake damage but not flood damage nsurance company like Wea thWise may adopt this approach. (4+48 marks) these measures coulc be used to helo achieve the mission. (12 marks) 3. Suggest altemative performance measures that cold be included in the perfomance measurement system to assist WeathWise to achieve its mission. (5 marks) 4. Write a report to the chief executive off cer explaining what steps she can take to encourage staif to behave in a way that supports sustainabilty. Specifically, explain to her how the perfcmance measurement system could be used in a balanced (10 marks) In 2004, the company's net profit rose by 15 per cent to $173 million on an asset base of $1 235 million. This is the third consecutive year of increased profits. Earnings per share were 62 cents, and the market value was $5.40 per share. The board is concerned that WealthWise makes a loss on its insurance business, while its investments yield a strong return and are the main reason for the increase in profitability. Its investment portfolio includes shares in BHP Billiton, Qantas, Telstra and James Hardie Industries way to support the achievement of the company's goals. Background Information: The board adopts a sustainability approach to viewing its performance and uses the following key performance indicators to assess company performance WealthWise Insurance has recently set up an internal information system to improve f social and environmental practices within the company. The company has its head office in Brisbane and offices in all capital cities and every regional city with a population of more than 50 000 people. One of the underlying principles of the company is to be socially and environmentally responsible. This principle has been in place for many years, dating back to the firm's founder, Jeannette Dai, who felt that she would like to contribute to society rather than simply maximising profits Financial indicators Net proft Gross insurance premiums Retum on inwestment Economic indicators Policy, practices and spending cn local suppliers Procedures for hiring local staff. Development projects primarily for public benefit. The company is a major contributor to charities, particularly those that focus on the homeless and the poor. It actively promotes environmental management in all of the company operations. t sponsors a program that provides scholarship to disadvantaged students to allow them to attend university, and it is proud to offer employment in the company to long-term unemployed and the poor. Each yea Social indicators: publishes a sustainability report that summarises its achievements across each area of performance Employee satisfaction ratings. Percentage of women in the lop three tiers of management. Number of ncigenous employees. Over time these activities have become a marketing strength of WealthWise. The social and environmental stance taken by the company has attracted many customers to the company. Listed on the Australian Stock Exchange in 2001, the company has also become a preferred stock of ethical and green investment funds Customers' ethical ranking of sales staff Number of staff hired who were previously uremployed teenagers. Tonnes of paper recycled per annum. Litres of fuel per collar ol sales. Environmental indicators The mission statement of WealthWise states that it will aim to: Percentage reduction in electricity usage. Support employees in achieving their personal and career goals Act in a socially responsible way when dealing with insurance clients and the general community Promote a better social and physical environment for the world Required However, the current chief executive officer, Sylvia Trott, thinks that the firm has 1. Explain what is meant by sustainability reporting and why a publicly Isted become complacent and is resting on its past achievements. She is concerned that the firm has built up a reputation for good social and environmental practices but is not walking the talk'. There is some level of discontent among employees about the way 2. Consider the list of key performance indicalors used by WealthWise. Explain how that management treats staff, and this is impacting on employee satisfaction. There have also been negative reports in the media of its treatment of businesses in Phuket and Langkawi that were damaged in the December 2004 tsunami. The reports claim that the company has tried to minimise the amounts paid to these businesses by strictly applying clauses in the insurance contracts that cover earthquake damage but not flood damage nsurance company like Wea thWise may adopt this approach. (4+48 marks) these measures coulc be used to helo achieve the mission. (12 marks) 3. Suggest altemative performance measures that cold be included in the perfomance measurement system to assist WeathWise to achieve its mission. (5 marks) 4. Write a report to the chief executive off cer explaining what steps she can take to encourage staif to behave in a way that supports sustainabilty. Specifically, explain to her how the perfcmance measurement system could be used in a balanced (10 marks) In 2004, the company's net profit rose by 15 per cent to $173 million on an asset base of $1 235 million. This is the third consecutive year of increased profits. Earnings per share were 62 cents, and the market value was $5.40 per share. The board is concerned that WealthWise makes a loss on its insurance business, while its investments yield a strong return and are the main reason for the increase in profitability. Its investment portfolio includes shares in BHP Billiton, Qantas, Telstra and James Hardie Industries way to support the achievement of the company's goals
