OBU RAP Topic 14 – Research an organisation that is recognized as having particularly strong ethical business practices, analyse and evaluate the benefits to identified stakeholder groups

Overview

An ethical business shows respect for its employees by valuing opinions and giving all the employees the due credit for their work. The business demonstrates respect for its customers by listening to feedback and assessing needs. An ethical business respects its vendors, pays on time and utilises fair buying terms. If these practices are common in an organisation, then that could qualify for research on this topic. Firstly, the organisation should be well known for its ethical values and there should be sufficient public evidence to support it.  It is crucial that the strong ethical values of the business are publicly recognised.

A culture of ethics is very important for the success of any company.

• Ethical behaviour includes honesty, fairness, integrity and understanding.
• There are several ways to encourage an ethical workplace culture, including establishing a company-wide code of ethics.
• Service and ethical behaviours are very important in a competitive market where an advantage over peers can be gained by demonstrating strong ethical values to the public.

Ethical cultures in all organisations can be promoted by hiring or promoting only those managers and executives who are genuinely dedicated to working under strong ethics and are intolerant of all kinds of unethical behaviours and activities.

Strong ethics is very beneficial for all the stakeholders. It leads to better communication with everyone in and outside of the organisation. Better communication always leads to better results. Ethics has a very strong connection with the stakeholder’s theory.

Students have to work on finding all the ethical values the company s famous for and how it impacts the shareholders and all other stakeholders positively.

Key features/requirements for topic 14 (strong ethical business practices)

The main requirements of this topic are as follows:

• Selecting a suitable company with strong ethical values
• Justifying the selection of the company with the publicly available data
• Identifying all the ethical values of the business
• Analysing the impact of these ethical values on the stakeholders
• Identifying all the benefits these ethics have on the business of the company

Key success factors for topic 14 (strong ethical business practices)

Following are the main points that need to be considered for a successful RAP submission

• Selecting a suitable company that has a proven record of ethical business practices
• Identification of the ethical values practiced by the company
• Assessing the impact of these strong business ethics practices on the stakeholders of the company
• Creating a link between strong ethics and the benefits to the business of the company
• Access to the internally generated information
• Permission from the management to use the internally generated information
• In-depth knowledge of all the ethical frameworks
• Gaining an understanding of ethical concepts and code of ethics
• In-depth knowledge of the impact of these ethics on the success of the company
• Demonstrating a clear understanding of the industry and its competitive peers
• Adequate application of the selected goals and objectives that were set at the beginning of the RAP in the proper sections of RAP
• The implementation of the correct research methodology to get good results on all the selected goals and objectives that were put in place at the beginning of the RAP
• Keeping the discussion logical by keeping all the objectives in mind
• Using reliable and appropriate sources for data gathering
• Properly referencing the information gathered according to the Harvard referencing style as told by the OBU.
• Usage of suitable business models to study different ethical behaviours and their impact
• A comparison to another organisation or the industry if secondary information is being used

Accounting and Business models for topic 14 (strong ethical business practices)

The following business models or frameworks/concepts can be used to study this topic:

Models of corporate social responsibility (CSR): Corporate social responsibility are business models that are specifically designed to educate companies to make efforts to operate in a manner that enhances society and the environment rather than degrading it. It is a great model to help companies build their reputation and brand image. These programs are also a great way to raise the morale of the employees at the workplace.

This model comprises four components of corporate social responsibility.

• The economical responsibility- companies exist to make profits and this is their main agenda. However, a company can make as much money as it wants only while staying within ethical limits.
• The legal responsibility is to follow the rules and regulations. Responsible organizations accept the rules as a social good and make good faith efforts to obey not just the letter but also the spirit of the limits.
• The ethical responsibility is to do what’s right even when not required by the letter or spirit of the law. This is the theory’s keystone obligation, and it depends on a coherent corporate culture that views the business itself as a citizen in society, with the kind of obligations that citizenship normally entails.
• The philanthropic responsibility to contribute to society’s projects even when they’re independent of the particular business

This model can be studied in detail to judge a company’s level of ethical behaviour. If the company is following the code of ethics and applying the model of CSR faithfully, then it means the company is ethically strong.

Stakeholder analysis: stakeholder analysis is a process of identifying all the interested parties that can influence your systems and potential changes. This is a very important process that management can use to win the support of other people. It ensures that your business operations succeed where others might fail. Identification of stakeholders and winning their trust and support is very crucial to the success of any project or company. This model can help companies in building relationships with stakeholders, winning resources and getting ahead of the game. Stakeholder analysis can be conducted in three steps:

• Identify your stakeholders: There might be many people or parties who are interested in the company such as the shareholders, government, alliance partners or suppliers
• Prioritize your stakeholders: classifying the stakeholders based on their power and influence over the company is the next step in stakeholder analysis.
• Understand your key stakeholders: companies need to understand how their key stakeholders feel about their business operations and projects.

The reasons for the company’s strong ethical behaviour can also be judged by looking at its financial and non-financial KPIs.

Relevant KPIs can also be used to better analyse this topic. KPIs are the key targets you should track to make the most impact on your strategic business outcomes. KPIs support your strategy and help your teams focus on what’s important. One approach to incorporating insightful KPIs is to use the SMART criteria: specific, measurable, attainable, relevant, and time-bound. Then focus on how to fine-tune the KPIs to reflect the most insightful data. Many other models and modes of analysis can be used to produce a well-researched RAP with the help and guidance of your experienced mentor.

Major benefits of choosing topic 14 (strong ethical business practices)

• Students will get to know about corporate ethics and ethical frameworks
• Students will learn about the relevant companies and the industry of the selected company
• The insight will be gained regarding all the business models used to study ethics
• Students will learn about integrity, honesty, and transparency and their importance for the growth of the business
• A detailed study regarding CSR and other ethical models will equip the students for their professional careers
• Students can apply their theoretical knowledge to real-world situations.
• A critical analysis of the ethical framework and the company’s business and financial performance will help to sharpen the required skills needed by a professional
• Avoiding unethical business practices will help the students to increase their employability and they will be viewed as honest and reliable

Possible limitations faced by the students while researching topic 14 (strong ethical business practices)

The main aim of conducting research is to set up new facts or confirm the outcomes of the previous research. It enables us to gain new knowledge regarding the subject. However, while preparing for OBU thesis research students face many problems. Some of the key limitations are as follows.

General Limitations

• Research method: Students need to have a clear understanding of the research methods. The research methods are not relevant or reliable as students are not trained in different methodologies. Simply replicating the knowledge available online or from various sources is not wise. There is a lack of basic knowledge regarding the correct methods of research.
• Overlapping information: overlapping information is often obtained because of excessive research through various sources. Each source has its own story to tell. Students often get confused regarding the facts and statements
• Students may not be able to get authorization to talk to the higher management and also some information may not be provided due to confidentiality issues.
• Interaction between the subject company and student: There isn’t any proper interaction between the subject company and the student. This means that a substantial amount of data going into the thesis goes untapped. The key issues of the company can only be highlighted with the help of internal company management.
• Time constraints: it is without a doubt that students need to complete their RAP before the deadline hits. Sometimes, the time limit can affect the quality of RAP very negatively. Students need to acknowledge this from the very start and set a schedule to be consistent with their research.
• Data collection process: The diverse ways of collecting data presents a strong limitation. If a student conducts an interview person to person or if he does it over the phone, both can have different effects on the interview. Hence, this data limitation must be reflected upon

Specific Limitations

•  Lack of understanding of ethical frameworks: Analysis of the ethical practices of companies is only possible if students are aware of the ethical frameworks and concepts. Lack of understanding can lead to poor analysis.

Suitable organization for topic 14

The most suitable organisation is the one in which the company has a public record of strong ethical business practices. It is very crucial to the successful RAP submission of this topic. It is not possible to write on this topic without extensive secondary research. Selecting a company that is established enough so that its performance and financial position to be studied over some time is necessary. To make a high-quality RAP, it is essential that students choose a company whose operations are easily understood by the student and he can make connections between various topics.

The following factors should be kept in mind while choosing a company for RAP:

• The general interest of the student in the company
• The amount of information available for the company
• Access to the internal management of the company
• Access to reliable secondary sources of information
• Familiarity with the industry sector associated with the company

The most appropriate organisation for topic 14 would be the ones that are famous for their ethical practices, and this is proven.

Suggested approach for this topic

Before starting your research, you should understand the assignment. The guidelines mentioned in the information pack should be read. The word count and length should be looked upon. What kind of sources are required by the topic, primary or secondary? The style of citation ‘Harvard referencing’ should be understood by the students. All the other requirements and directions made by the OBU must be complied with. After choosing this topic, a proper mind map must be made from the start, so the student conducts all the required tasks in a proper and timely manner. All the major requirements and aspects of the topic should be considered thoroughly so that a strategy can be devised to meet those requirements. A research methodology and all reliable websites and authentic sources should be noted down. The style of referencing must be kept in mind while researching this topic to pass the OBU RAP. A comparison organisation might be helpful for topic 14.

In Part 1-(research objectives and overall research approach), Students need to make a table of contents and a title page mentioning the ACCA reg number and the selected topic. Part 1 mostly contains the introduction and the objectives of the RAP. The objectives should be consistent with the research of the project. Your personal aims and goals are not required to be a part of this section. The reasons for selecting the topic must be jotted down. The organisation which is suitable for topic 14 and why that organisation was deemed appropriate for the topic.  The aims and objectives of the project should be explained in several points. Research questions are written in detail, and it targets the specific areas that need to be researched. Usually, there are 3 or 4 research questions. Consideration of all these points is important in part 1. If you follow all these instructions, you can move very strongly ahead.

Part 2- (Information gathering/accounting and business techniques) is a very crucial section as all your understanding of the business and accountancy models is analyzed here. A quality explanation of the used models or any other frameworks and analysis of all their limitations must be performed. The most structured way of representing section 2 is by first mentioning the sources of information that were used to acquire the data for research on topic 14. Topic 14 relates to strong ethical business practices so publicly available information can be used such as the annual reports, articles by famous newspapers, journals etc. Students are advised to select only those resources that they can understand easily.  Briefly describe all the sources used and why they were considered useful sources. There are many websites, books and newspapers that can be used. A discussion of the limitations of your information gathering must be included. Students should find references to mention limitations instead of writing from their own opinion. Any ethical issues that arose during information gathering and your solutions regarding the issues. Every part should be backed up by good references. Next, you would list down all the business and accountancy models and their possible limitations. CSR frameworks are the most appropriate for this topic. To find out more about the selection of respective models for topic 14, kindly refer to section ‘Accounting and business models for topic 14’ above.  Word count is to be prioritized which is 1800-2000 words.

In part 3, there is a further evaluation, analysis, and conclusion. It should contain a description of the results obtained and all the limitations. Further research with examples and comparisons between the two companies is done. It is the most critical section, and most students fail in it if they are not in the hands of an experienced mentor. Evaluation and analysis of topic 14 mean you need to explain the financial performance with the help of ratios and compare those ratios over the three years. Companies’ annual reports must be used to analyse the financial ratios and improvements in profitability, revenue, and sales due to the ethics of the company. How the ethical behaviour impacted the key financial ratios. the trends should be represented.  Ratios like liquidity, gearing, P/E ratio, profitability, and EPS movement help to critically analyse the changes taking place in the selected company.  Evaluation means that you will be extracting results from the data researched. Hence this part of RAP provides actual value and meaning to your research and RAP. All findings should be presented in a good form with the help of graphs, pie charts, tables, etc. Conclusions must be made based on your research work. Recommendations to the selected company may be made but it is not very necessary. It is of utmost importance that word count must be kept in mind. If you exceed it in any way, then the examiner will not mark the conclusions resulting in failure.  4500 words must be written to ensure a detailed analysis.

Suggested approach for SLS

The meetings with the mentor must be planned at the start of the RAP and a track of those meetings must be kept in a diary as it will help later on to write the SLS. The time required to conduct effective research needs to be calculated at the start and a timetable should be kept in place. Religiously following the requirements and keeping track of the time is necessary to pass the RAP. All the information gathered should be recorded systemically and needs to be shared with your project mentor so that complete guidance can be given to you. Consultation with the project mentor ensures that a student passes with the highest possible grade. If any issue arises it can be solved by discussing it with your project guide.

Sources of information

There are mainly two types of sources that can be used, primary and secondary.

Primary sources are the data that you collect on your own and it is considered first-hand. This can be done by conducting interviews, surveys, or having participants fill in questionnaires. In this topic, students are not required to gather information directly from the management which will qualify as a primary source of information

Secondary information on the other hand refers to already available and published information. Using it to your own advantage by checking the authenticity of these sources can be very beneficial for the RAP.  All other sources of information such as online websites, journals, and articles are considered secondary sources of information.

The CSR reports, GRI reports, and the ethical guidelines of the company must be obtained. The reliability of each source should be checked.