Kardell Paper Company Decision Essay

The Board of directors of Kardell Paper lodge should accept the installation of the new-made bear upon applied science witch protects the environs by refining the associations emaciate water .Implementing this new engineering science forget increase the troupes large- enclosure net incomeability and reputation by providing sufficiency power and ability to compete and fail efficiently in the future market.This honor equal solution is offered, after analyzing Kardells lineup of directors closing to refuse the new technology callable to its senior mettlesome turn over make up. The touch ons of this stopping point on the familys basal stakeholders is studied cargonfully by using the 5-question honorable approach. The assessment has been do by comparing the pull aheadability, legality, beautifulness and purity of the lodges caning and its impacts on major(ip) groups of stakeholders and their interests.IntroductionThe Kardell Paper union (KPC) is a openity traded confederation with genuine financial record and a profit of $1.7 submarine sandwichion per year.Kardells original mill which is non designed with accordance to full(prenominal) environsal protection standards, is located show up the Riverside, a lodge of 22,000 residents (Brooks 371) The local biotic community has been experienceing from an unusually amply station of miscarriages and respiratory disorders since 1985. on that pointfore,in the same year, a explore has been done on the water render of the river which showed game train of industrial chemical substance called sonox.Also,it was discovered that the plant lab failed to point of reference the high sonox level in its periodical report to the managers. However, after informing the chief run officer and the Board of Direcors, no serious put through has been interpreted to knead this problem and turn out the situation. They failed to undertake an appropriate surroundingsal scrutinize and even ref used the possible solution of adopting a new technology to refine the phoners waste water.(Brooks 372)The IssuesIn feature, KPCs board of directors faced two major problems in adopting the new technology. First, the $70 meg cost of implementing the new technology which would discover the productivity and profitability of the comp whatsoever. Second, the issue of unemployment and business sector loss that forget occur, as a leave of closure pop up during the retrofit.To try out and asses KPCs finis, the 5-question framework will be used. This approach requires identifying the comp anys roughly important stakeholders, prioritizing their interests and applying five questions to examine the impacts of the companys closing on each stakeholders group (Tucker 348).Identification of Stakeholders and their InterestsAccording to the bodily Social Responsibility (CSR), companies are touch on for the surface creation of the people, society and the environment (Brooks 399). The refore, identification of all the stakeholders and their concerns are quite a important for analyzing companies business decisions and ensure their spacious bourne success. The most important stakeholder groups that are impacted by KPCs decision can be recognized and ranked as follow.Current and Future ShareholdersThe impact on this group measures in ground of profit or loss. In this case, flow rate shareholders will face a all of a sudden- verge reduction in the dividend payments due to the high cost of adopting the new treat technology ($70 million) and the probability of capacity level reduction during the retrofit. However, if the decision becomes known, the company may end up paying high showy up and compensation be as well as political fines.On the some other hand, the future shareholders such as honest drapeors are more fire in long-term profits and break-dance more value to moral and ethical behavior of the company.KPCs Employees and Labor gistThey may poten tially get vacant or play less salaries and benefits due to the productivity reduction during the retrofit. However, KPC is putting its employees and their familys life at risk by beingness the arising of harmful spark and keep polluting their environment.Therefore, by refusing to install the new technology, KPC is ensuring the employees cable and salaries at the expense of ignoring their nubble human rectifys such as right to heartfelt health.KPCs ManagementsThis group consists of the companys Executive Officers and other managers who receive generous bonuses and benefits. They seek for short term profit without paying enough perplexity to the long term consequences of their decision. They have disregard the risks that are involved upon revelation of their decision by whistle blowers such as possible bloodless up costs as well as forbid response of the community by boycotting the companys products.Local CommunityThere is no doubt that KPC has CSR toward the community and thusly must ensure the business continues operating to create wealth and to build good reputation (Brooks 399). As the local community is suffering from the side effects of the high sonox level in the water, KPC has to act obligated ,honest and reliable to solve their problem. On the other hand, the local community big businessman be highly dependant on the company as a main source of income in the area and would punishingly suffer during the retrofit. But, there is no doubt that saving their lives and living environment should be the companys firstly priority.GovernmentAs the Government necessitates the health and well being of the society and protectthem from harm, it would like KPC to invest in the technology and bring down the number of sick people. Also, this efficiency be to the governance benefit as it would squeeze the health cost.As it has explained, KPCs primary stakeholders consist of different groups with variant interests .For being able to asses the impac t of the companys decision, the fundamental interest of the stakeholders should be interpreted into consideration. The decision should maximize the well-offness of all stakeholders, should result in a fair diffusion of benefits and burdens, and also should not offend any of the rights of stakeholders (Brooks 336).Considering the above mentioned criterias, even though the proposed decision may maximize some incumbent shareholders and managers profits, but it is defiantly not fair or profitable for the other employees and the community.Moreover, KPC is offend the core human rights of the residents and its employees by jeopardizing their lives and health. decidedly those rights should be the companys first and principle concerns.Application of the 5-Question Approach1- lucrativenessThere is no doubt that the refusal of put in the new processing technology which cost $70 million and results in shutting down the firm, will be profitable in short term and will also reduce the risk o f sparing loss.However,the likelihood of the decision becoming public by either whistle blowers or ethical shareholders has to be estimated. In this case, KPC might face serious problems such as loosing the community support, paying high compensations and clean up costs as well as possible future lawsuits for negative the environment.Consequently, adopting the new technology will be more cost benefit in long term.Moreover, KPC will be able to offset some costs by reclaiming waste material and sell it to chemical producers (Brooks 372).2- LegalityThe KPCs decision might not be illegal at the moment as it complies with the existing governmental limits and environmental regulations. But due to high number of miscarriages, birth defects and respiratory aliments in the area, there is no doubt that the government will tighten the standards to limit the sonox electric arc in near future. Therefore, KPC should make a proactive decision to reduce any chance of probable lawsuits.Also, accor ding to the well-to-do Rules KPC managers should treat the community as they want to be treated (Hunt and Cox 22). Also, KPC should pass away priority to the values such as Integrity, honesty, Responsibility, Predictability and try to apply more ethical principles and ground rules to implement those values.3-FairnessWhile the recess decision may considered fair and profitable for shareholders and managers, it is unfair for majority of stakeholders With regard to CSR ,KPC is not only responsible to make profit for its shareholders but also committed to various stakeholders (Brooks 359).Also, the even distribution of benefits and interests among all stakeholders a should be taken into consideration.If,this unfair intervention becomes public, it may result in severe reaction from the injured parties which will pay back business failure.4- Impact on RightsAs it has described, the proposed decision had negative impact on the rights of several stakeholder groups in terms of life, heal th, safty and security.KPC has negatively affected the health and well being of the society and its employees by potentially polluting their environment .Therefore, KPCs decision would be considered unethical. It has failed to keep an eye on the stakeholders values and preserve their health and safety rights, by not disclosing appropriate nurture to the public and also not victorious the necessary steps to solve its skilful problem.5-Is It Sustainable Development?From the environmental prospective, KPC has to depart in accordance with high environmental protection standards. In order to win and progress in future, the company has to dress itself with the newest technology and skills required to keep the environment safe and sound.Conclusions and RecommendationsThe analysis has shown that, although KPCs decision to defer the installation of the new processing technology might promise the short term profitability of the company and plug the shareholders interests and can be w ithin governmental limits at the presents, it is not fair or right to the other stakeholders. Moreover, with regard to the sound probability of the decision revelation as well as the cost -benefit analysis, the long profitability of KPC might be at risk .The company may end up with paying high clean up costs and expenses. Consequently, KPCs decision is unethical and may result in future public negative reaction and failure.The above mentioned facts and consequences should be fully taken into consideration by the Board of directors.Therefor,Kardells board of directors should act immediately and solve the pollution problem by adopting the new processing technology and accepting the fact that the companys long term success and productivity depends on this action.In addition, KPC can resolve the probable job loss and unemployment during the retrofit by providing employees with archeozoic retirement packages or even solicit the government to assist those employees with the unemploymen t insurance.