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ACCA Applied Knowledge · Business and Technology · Social and demographic factors

Zentra Foods voluntarily introduces a programme to reduce packaging waste, although no law requires it. Customers have begun to expect such action from large food retailers. Which statement best describes the company's decision?

It is corporate social responsibility driven by changing stakeholder expectations. The company acts voluntarily beyond legal requirements because customers now expect large retailers to reduce packaging waste, so it is not compliance, cost leadership or a mandatory disclosure.

  1. AIt is an example of corporate social responsibility driven by changing stakeholder expectationsCorrect
  2. BIt is a legal compliance requirement imposed by government regulation
  3. CIt is a cost-leadership strategy that must reduce unit costs
  4. DIt is an example of a mandatory governance disclosure under company law

Explanation

The action is voluntary and responds to stakeholder expectations, which is corporate social responsibility. The scenario says no law requires it, so compliance is wrong. Nothing suggests the programme is mainly aimed at cutting costs.

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