ACCA Applied Knowledge · Business and Technology · Sustainable business practices
A manufacturer publishes a report showing its carbon emissions, water use and waste, and sets targets for reducing each over five years. Which statement best describes the main benefit to the business of this approach?
The main benefit is that it shows accountability to stakeholders and allows progress to be measured against targets. Disclosing emissions, water use and waste with targets makes performance transparent and manageable. It does not exempt the company from regulation or guarantee immediate profit.
- AIt makes the company exempt from environmental regulation
- BIt demonstrates accountability to stakeholders and allows progress to be measured against targetsCorrect
- CIt guarantees an increase in profit in the first year
Explanation
Reporting and targets give stakeholders information and let the firm track progress, supporting accountability and reputation. Reporting does not remove legal obligations, and profit gains are not guaranteed, particularly in the short term.
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