Business Ethics and Sustainability w7

Running head: CONCEPT OF VALUE 1

CONCEPT OF VALUE 6

Concept of Value

Student Name

Institutional Affiliation

Concept of Value

Value plays a big role in maintaining sustainability. Organizations do not run from the thin air. They consume resources generated by the society. The raw materials used in the production process are obtained from the society. Some of these activities lead to environmental pollution. Labor is also obtained from the society. Value ensures that the organizations give back to the society, by undertaking different sustainability programs (Confino 2013). Organizational value plays a big role in improving value (Confino 2013). Organizations learn on which programs, create value the different types of stakeholders. This fact enables easy targeting of by the organizations.

Various inputs may be used to create value for an organization. The inputs used may vary from being social inputs, environmental inputs, and economic inputs. Value creation by the use of social inputs involves the society around the company premises, or the community that is directly affected by the services. These inputs may not have any financial gains to the company or the community involved (Evans 2015). In some cases, however, the members targeted may benefit financially. For example, a company’s employees may decide to offer charity services to the less fortunate in the society.

The environmental inputs to value creation by the society are the most common. Organizations tend to undertake environmental conservation activities such as cleaning cities. Economic inputs mainly involve the shareholders of the company. Granting bonuses to the shares held creates affinity to the organization. Employees may also be targeted through compensation packages. Different stakeholders perceive value differently. The shareholders of the organization may perceive value as the creation of wealth and concentration of the organizational resources (Evans 2015). On the other hand, the community and employees may perceive value as focusing on the organizational long term objectives, and it is not limited to the financial development.

References

Confino, J. (2013). Why values need to be at heart of sustainable business transformation. Retrieved from http://www.theguardian.com/sustainable-business/dov-seidman-un-global-compact

Evans, M.H. (2015). From shareholder value to stakeholder value. Retrieved from http://www.exinfm.com/board/stakeholder_value.htm

Additional Paragraphs

The concept of value in an organization is a broad one. Organizations can create value in various ways. The value created by the organization through its sustainability programs tend to be elusive, and not quantifiable (Evans 2015). The ability to measure the value created is limited since there are no figures involved. For example, an organization may create value through goodwill from its customers. The goodwill created may be given financial estimation, for accounting purposes, but in real sense, goodwill is not quantifiable.

However, the success of the sustainability programs undertaken by the organizations can be drawn from the value created. For the society in general, value can be measured by the extent to which the organization has achieved its goals to give back to the society, or undo its ‘wrongs’ such as environmental degradation (Evans 2015). The shareholders, however, have a different view on measuring value. Shareholders are mostly concerned with the financial performance of the company, and the extent to which they gain returns on their investments (Evans 2015).

Reference

Evans, M.H. (2015). From shareholder value to stakeholder value. Retrieved from http://www.exinfm.com/board/stakeholder_value.htm