Em lDLC leasing is a reputed nancial institution and has recently set up an infounation system to improve sustainability and social responsibility practices within the business. The company has its head ofce in Sydney and branches in other crystal cities in Australia with a population ofrrime than 4H UCOpeople. Internationally companies now a days are concern about corporate social responsibility {CS-R) initiativesinabidtocteateanimpact towards theoorrumiriityaridgetclosetotheir customers. As such, one of the underlying [nineiplies of the IDLC Leasmg is to focus on sustainability initiatives, corporate foundations, employee volunteer programs, and dtmatioris to charity etc. It actively presumes environmental management in all ofthe company operations. It sponsors a program that provides scholarships to disadvantaged students to allow them to attend university, and it is pmiid to offer employment in the company to long-term unemployed and the poor+ Each year it publishes a sustainability report that summaries its achievements across each area of performance. Over lime these activities have become a marketing strength of IDLC. The social and environmental stance taken by the company has attracted many customers to the company. Listed on the Australian Securities Exchange in 2003, the company has also become a preferred investment ofethieal and green investment funds. The rriission statement of IDLE states that it will aim to: 0 Support employees in achieving their personal and career goals. 0 Act in a socially responsible way when dealing with insurance clients and the general community. I Promote a better social and physical environment for the mild. Ho'iii'e'ii'ii-r,I the current CEO, Micheal Smith. thinlts that the rm has become complacent and is resting on its past achievements. %e is concerned that the firm has built up a reputation for good social and environmental practices but is not 'walliing the talli'. There is some level of discontent among employees about the way that mnagernerit treats staff. and this is irripacting on employee satiscoon. There have also been negative reports in the medh of its treatment of businesses in Phuliet arid iarigltawi that were damaged in the Decisnber 21114 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 riot ood damage In 21104. the company's prot nine by 10 per cent to $125 million an an asset base nf$155ll million. This is the third consecutive year of increased prots. Earnings per share were 52 cits-its.I and the market value was $5.30 per share. The board is concerned that IDLC makes a loss on its Msinesawhileits imresunentsyieldasuongretumandarethenuinmsmfortheincmseht protability. Its investment portfolio includes sham in NAB. Telstra and James Hardie Industries. The bmrd adopts a sustainability approach to vie-wing its performance and use: the Following key perfumes: indicators to assets company per1rrrmce: Financial: Profit. o Gross insurance premiums. o Return on investment. Economic indicators: Policy, practices and spending on local suppliers. o Procedures for hiring local staff. o Development projects primarily for public benefit. Social indicators: o Employee satisfaction ratings. o Percentage of women in the top three tiers of management. o Number of indigenous employees. o Customers' ethical ranking of sales staff. o Number of staff hired who were previously unemployed teenagers. . Environmental indicators: o Tonnes of paper recycled per annum. Percentage reduction in electricity usage. o Litres of fuel per dollar of sales. Required: 1 Explain what is meant by sustainability and social responsibility reporting and why a publicly listed leasing company like IDLC may adopt this approach. 4 marks 2 Consider the list of key performance indicators used by IDLC. Explain how these measures could be used to help achieve the mission. 4 marks 3 Suggest alternative performance measures that could be included in the performance measurement system to assist IDLC to achieve its mission. 4 marks
