BSS064-6 Leading and Managing Organizational Resources Assignment Sample
1. Professional email
Sender Address
………..
……….
………
February 17, 2022/ ……….
To
The Operational Association
Tesla
UK
Subject Line: how to enhance corporate governance balancing stakeholder interests in Tesla?
Dear Mr. / Mrs.
Introduction
Corporate governance is referred to as the system of practices or processes and rules by which an organization is controlled and directed (Shleifer and Vishnu, 1997). It is essentially considered as the concept of balancing the interest of the stakeholders within the organization which most of the time includes the senior management executives, shareholder financer, community supplier consumer, and the government. Since the corporate governance also aligns with the framework of providing attainment to the organizational objectives with therefore it is practically incorporated in different spheres of business management and operation from performance management to action plans and from internal control to ultimate disclosure (Alabdullah et al., 2019; Danoshana and Ravivathani, 2019).
Corporate governance
Communicating the corporate governance of an organization is a key component of investor and community relationships (Mallin, 2016). On the investor relations site of Tesla for example the company outlines the corporate leadership, the board of directors and executive team, and the alignment of the corporate governance which include governance documents and committee charter such as stock ownership guidelines by laws and the articles of incorporation within the business operation (Bhagat and Bolton, 2019). It has not only helped the company in broader prospects to generate greater levels of corporate governance but has also influenced many shareholders to demonstrate the standard of good corporate citizenship through ethical behavior, environmental awareness, and appropriate corporate governance practices (Ouchchy et al., 2020).
Empowering the independent directors within the organizational framework has to be supplemented in the company with greater responsibilities and accountability (Rogerson, 2017). In order to increase the accountability in broader prospect organizations might require the board of directors to present at the General Meeting and give them the future opportunity to interact with each other and pose questions (Baró‐Solé et al., 2018).
Financial issues
Belonging to the technology industry Tesla has its roots to boost the expectation of the investor and attract stratigraphic valuation with exciting potential for future growth. However, there are significant numbers of financial risks associated with the corporate governance management and practices of the organization (Etzioni and Etzioni, 2017
On the basis of collaborative intervention theory, expansive learning facilitates formative intervention which with the effective strategy implementation of the policy makes reduces the linear casualty. Applying this theory, the future success of the organization therefore can be stated that is extremely dependent on the ramping up of infrastructure and manufacturing capacity (Taylor and Bouazzaoui, 2018). Therefore the ultimate objective of the organization to run corporate governance and benefit the external stakeholders which is the customer in this case is not being met appropriately. It is also been estimated that the company with model three vehicles lost more than 14,000 dollars in the year 2018 (Taylor and Bouazzaoui, 2018).
Ethical issues
Considering the application of utilitarian ethics theory, which considers the actions to be ethical if shares happiness and pleasure, while unethical if it does not, it can stated in terms of Tesla that although the extreme use of Non-Renewable sources such as petroleum will be reduced to a certain extent with increasing prices and the increasing manufacturing capacity of the lithium-ion it will ultimately hamper the environment in one way or the other (Taylor and Bouazzaoui, 2018).
Workers in the Giga factory of Tesla have been struggling with the safety issue. Major issues such as lack of basic sanitation or local housing shortage are the prime concerns (Wong, 2017). Apart from that based on the reports of occupational safety and health administration inspection records by USA today it has been identified that at least three injuries in a month were reported by the organisation and in cases of chemical spills the evacuation processes were also not sorted within the company.
Making the statement and the auditing information does not align with each other the claim of Tesla to ensure the supply chain practices to be human and safe are not ethically viable and reliable (Etzioni and Etzioni, 2017).
Sustainability issues
Due to The limited manufacturing and slower pace of growth and construction of the gig factories or the battery factory the organization can also run out of batteries as the demand of the electric vehicle and the construction of the gig factories are not aligned (Baró‐Solé et al., 2018). Due to the regulatory and logistic hurdles the manufacturing and construction of the gig factories sometimes remain closed or shut down for a consecutive number of months and therefore it can meet the organization to face issue interns of solving the battery crisis.
Due to the increasing production in the oil at Global platform and associated this with the once-dominant peak oil theory it can be stated that the Global production and its increase can negatively impact the gas price of Tesla (Tibiletti et al., 2021). As other competitors can get oil at comparatively less prices horizontal drilling and Hydraulic fracturing are being used by the competitors for extracting the oil. As the main focus of Tesla is to transition into mainstream auto manufacturing and generate a constant cash flow from it, the increasing advancement in the technology can make the consumer less likely to opt for the transition to electric cars and vehicles if the petroleum-based fuel cars and vehicles are available at cheaper prices and as better alternatives (Rogerson, 2017).
Conclusion
From the above discussion it can be concluded that being a major player in the electric vehicle and Clean Energy Tesla is yet facing financial and ethical issues to maintain its competitiveness to provide workplace safety to the workers as well as ethical issues in terms of falsification of the claims. In order to improve its efficiency in the business operation the company should maintain appropriate standards of government certification and also increase charging stations and also ensure that the existing set of consumer are aware about its products and services.
Recommendation: Applying 3P’s (Triple Bottom Line)
- People: In order to increase the transparency among the existing set of consumers and attract the new set of customers the organization needs to be transparent due to which certification from the government bodies or international bodies can play a significant role to ensure that the organization is the following transfer and regulation and completely environmentally sustainable raw materials in the supply and manufacturing of its product.
- Planet: The organization should focus on becoming one of the major producers of electric vehicles which will require not only focus on the manufacturing of the vehicle but also adequate availability of the raw materials.
- Profit: In order to maintain the competitiveness in the marketplace the organisation will also need to increase its range of products that focus on the low income consumer also.
- Tesla should make the use of social media platform and other advertising online platform to advertise the products and services a so that the external shareholder or consumer have a knowledge about the products and services it offers and its competitive advantage
- Tesla should also increase the charging stations and increase the awareness about the same to the existing set of consumers. In areas where the company has records of top selling of the product it should increase the charging stations
References
Alabdullah, T.T.Y., Ahmed, E.R. and Muneerali, M., 2019. Effect of board size and duality on corporate social responsibility: what has improved in corporate governance in Asia?. Journal of Accounting Science, 3(2), pp.121-135. Available at: http://ojs.umsida.ac.id/index.php/jas/article/view/2810 [Accessed on 17 February 2022].
Baró‐Solé, X., Guerrero‐Roldan, A.E., Prieto‐Blázquez, J., Rozeva, A., Marinov, O., Kiennert, C., Rocher, P.O. and Garcia‐Alfaro, J., 2018. Integration of an adaptive trust‐based e‐assessment system into virtual learning environments—The TeSLA project experience. Internet Technology Letters, 1(4), p.e56. Available at: https://onlinelibrary.wiley.com/doi/abs/10.1002/itl2.56 [Accessed on 17 February 2022].
Bhagat, S. and Bolton, B., 2019. Corporate governance and firm performance: The sequel. Journal of Corporate Finance, 58, pp.142-168. Available at: https://www.sciencedirect.com/science/article/pii/S0929119919300628 [Accessed on 17 February 2022].
Danoshana, S. and Ravivathani, T., 2019. The impact of the corporate governance on firm performance: A study on financial institutions in Sri Lanka. SAARJ Journal on Banking & Insurance Research, 8(1), pp.62-67. Available at: https://www.indianjournals.com/ijor.aspx?target=ijor:sjbir&volume=8&issue=1&article=004 [Accessed on 17 February 2022].
Etzioni, A. and Etzioni, O., 2017. Incorporating ethics into artificial intelligence. The Journal of Ethics, 21(4), pp.403-418. Available at: https://link.springer.com/article/10.1007/s10892-017-9252-2 [Accessed on 17 February 2022].
Mallin, C., 2016. Corporate governance. Oxford university press.
Ouchchy, L., Coin, A. and Dubljević, V., 2020. AI in the headlines: the portrayal of the ethical issues of artificial intelligence in the media. AI & SOCIETY, 35(4), pp.927-936. Available at: https://link.springer.com/article/10.1007/s00146-020-00965-5 [Accessed on 17 February 2022].
Rogerson, S., 2017. Is professional practice at risk following the Volkswagen and Tesla revelations? software engineering under scrutiny. Acm Sigcas Computers and Society, 47(3), pp.25-38. Available at: http://ce.sharif.edu/courses/98-99/2/ce347-1/resources/root/NBIC/BergenStudy%20e.pdf [Accessed on 17 February 2022].
Taylor, A.K. and Bouazzaoui, S., 2018, July. Moving forward with autonomous systems: Ethical dilemmas. In International Conference on Applied Human Factors and Ergonomics (pp. 101-108). Springer, Cham. Available at: https://link.springer.com/chapter/10.1007/978-3-319-94334-3_12 [Accessed on 17 February 2022].
Tibiletti, V., Marchini, P.L., Furlotti, K. and Medioli, A., 2021. Does corporate governance matter in corporate social responsibility disclosure? Evidence from Italy in the “era of sustainability”. Corporate Social Responsibility and Environmental Management, 28(2), pp.896-907. Available at: https://onlinelibrary.wiley.com/doi/abs/10.1002/csr.2097 [Accessed on 17 February 2022].
Wong, J., 2017. Tesla factory workers reveal pain, injury and stress: ‘Everything feels like the future but us’. [online] the Guardian. Available at: <https://www.theguardian.com/technology/2017/may/18/tesla-workers-factory-conditions-elon-musk> [Accessed 17 February 2022].
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