Assessment of the Sustainable Business Practices of Dell Biologics Incorporated (DBI) Concerning Environmental Social and Economic Dimensions

Date

6-2022

Degree

Bachelor of Science in Agribusiness Management

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Mar B. Cruz

Committee Member

Melodee Marciana E. De Castro, Cris Edwin B. Bonalos

Abstract

The current situation depicting demand forecast from 2015 to 2030 shows that there will be an increase in the global middle class; from 2.5 billion to an estimate of about 5 billion while the supply situation, on the other hand, is also considered to be in bad shape, with this projected growth in demand along with the fixed amount of land, fresh water, forest cover, and other nonrenewable resources on earth, it can be said that the “environmental stability is dwindling” (Hedstrom, 2018). With corporations being one of the central actors for such unfavorable trends, sustainability in businesses or corporate sustainability emerged. Today, the concept can hardly be considered as a phase or a trend only, due to the even more aware consumers of climate and human rights issues, sustainability is now on the center stage of business operations. As a result, sustainability as compared to before is not something businesses implement as part of a strategy only, rather, it became one of the foundations of firms’ strategy formulations, from an initial “nice-to-have” concept, businesses are starting to set sustainability as a mindset (WorldFavor, 2021). Considering also factors such as increasing stakeholder impact, sustainable government regulations and policies, globalization, access to sustainability information, and the existing age of accountability combined with the observed benefits such as risk management improvement, investor attractiveness, employee engagement and motivation, customer loyalty improvement, and improved financial performance, resulting to the ignition of the firms’ need for incorporate sustainability.

As much as sustainability applies to large, multinational corporations, the relevance of sustainability to MSMEs is also very much existing since no business is exempted from the driving forces of sustainability, and its advantages and benefits are applicable no matter the size of the organization (Kohl, 2011). And with the higher threat of greenwashing to these types of enterprises since MSMEs are not required to comply and disclose their non-financial or sustainability practices and MSMEs being a significant economic driver for the Philippines, assessing the sustainability of an MSME will allow us to not just know if the company is sustainable or not but will also provide how valuable sustainability really is to a business firm if sustainability is being incorporated appropriately or a threat of greenwashing is evident. Moreover, assessment of an MSME’s sustainable practices will help in the confirmation of sustainability’s current form, a concept recognizing and including the other aspects of economic and social which as compared to before is highly centered on the environment alone—a framework more commonly known as the triple bottom line. The MSME of interest is Dell Biologics Incorporated or DBI, a duly-registered, FDA-licensed company operating in Barangay Tuntungin-Putho, Los Baños, Laguna. Due to its contribution to the input and production subsector together with its utilization of natural or agricultural raw materials, the company is considered a player in the agribusiness industry—an industry which is also being highly affected by the business risks brought about by corporate sustainability. Dell Biologics Inc. operates with its three main principles in mind: technical creativity for its offerings, nurturing partnerships with its clients and customers, and last but most significant of all, sustainable innovation.

This resulted in the general objective of the study: To assess the current sustainable performance of Dell Biologics Incorporated in all of its wide range of product lines and offered services, along with the other specific objectives: presentation of the firm’s sustainability values and motivation through its profile (corporate values, mission, and vision), to describe the firm’s sustainability efforts and practices implemented in terms of the three pillars of environment, social and economic, to discuss how well corporate sustainability is being implemented and performed then based on the results, which dimensions highlights the firm’s overall sustainable efforts and on the other hand, identify lacking dimensions of sustainability where efforts for improvement should be considered, and lastly to recommend courses of action based on the results which may help with the improvement of the firm’s short-term and long-term corporate sustainability.

In order to achieve such objectives, the study followed four connected and consecutive steps, the first step is defining the sustainability motivations of the company by looking first at its publicly-available statements—vision, mission, and corporate values, since these statements reflect the company’s long-term goals, the reason for existence and principles respectively, the company’s sustainability motivation (legitimacy, market success, process improvement, and social insurance) combined with other information given by DBI about its reason for being a sustainable business (strategic-, economic-, or values-based) were also utilized to establish its motivations. After making clear of DBI’s motivations, data was also then collected from the firm in the form of a questionnaire which was derived from the Securities and Exchange Commission’s modified sustainability reporting template (Appendix A) utilizing sustainable performance indicators (SPIs) as a tool to measure a business organization’s sustainability performance, SPIs found in the template are categorized into the three dimensions of the triple bottom line namely: economic, environmental, and social. The sustainability efforts of the firm were also examined further through its products and services in relation to its contribution to the UN Sustainable Goals as included also in SEC’s sustainability reporting guide. After the analysis of the quantitative and qualitative data per dimension, the identification of the dimension which highlights the firm’s overall sustainable efforts the most and which dimension needs improvement or seems lacking was derived from the analysis combined with the sustainability reporting scoring method. The basis to identify the weakest and strongest dimensions was seen in the percentages of the scores per dimension. Upon knowing the dimensions prioritized and least considered, conclusions were then formed in order to also make a connection to the results and DBI’s sustainability motivations. The final step is to formulate recommendations hopefully to be executed by the management.

Upon conducting such steps, it was found out that the firm is indeed incorporating the concept of sustainability at first glance due to its incorporation as one of the firm’s corporate values. However at first look; two dimensions seemed to be the two more obvious dimensions when it comes to the company’s vision and mission statements: the environmental and social dimensions. Sustainability, being regarded as a strategy and the use of the preconceived idea that sustainability is more about being environment- friendly showed some sort of a hint as to how sustainability is being defined by the company: sustainability through the creation of environment-friendly products.

Evaluation of the firm’s sustainable performance through the selected SPIs has shown that in terms of the economic dimension, most of the information given by the company promotes favorable performance. This performance, however, is affected by the current sustainability risk, the pandemic and although it also affected the firm negatively by lowering some of the product line’s production volume, it also gave an opportunity to the company. SPIs under the environmental line, on the other hand, consist of unfavorable increases in some of their performance, especially in the use of different materials. This increase in figures, however, is managed by the company through other means such as limited to zero use of other energy sources, non-consideration of incineration as a form of waste disposal, wastewater treatment, and avoidance of hazardous chemicals by using natural and environment-friendly materials. The SPIs for the social dimension exhibited the company’s good engagement with its employees and maintains good community relations by providing the local community with a safe environment, income source, scholarships, inclusive events or programs, and donations. All of these suggest a favorable performance as far as social sustainability is concerned.

Results of the sustainability reporting scoring conducted revealed that when providing and disclosing sustainability information—which can also be linked to how strong each of the dimensions was due to the amount of information they provided, it was found that the environmental dimension is the strongest or the dimension in which their sustainability efforts are mostly focused followed by the social sector while the economic sector least focused. It was also observed that the firm’s focus on sustainability’s environmental dimensions in its motivation was consistent since the environmental dimension of sustainability was indeed identified as the most highlighted dimension. And if we consider the favourability of the SPIs under each dimension, however, it can be concluded that the social dimension consists of business practices that are more sustainable than the other sustainability dimensions.

Looking at the more general view, however, of the firm’s sustainable practices through its products and services and its contribution to the UN SDGs, it was found that most of its products contribute to SDG 9 (industry, innovation, and infrastructure), SDG 12 (responsible consumption and production), SDG 3 (good health and well-being) and SDG 14 (life below water).

It was then recommended in terms of the firm’s economic sustainability that although currently, DBI’s economic performance is showing favorable trends and figures, the company should keep in mind that factors such as the pandemic greatly affected such performance, this current increase should be maintained by the firm especially since the pandemic and its effects are beginning to disappear and slowly starting to show unfavorable performance (costs are catching up with the firm’s revenues). And as concluded earlier, the economic dimension is the least focused dimension and while it shows good sustainability practices, it should still be improved since economic sustainability is also required to maintain the sustainability of the other dimensions. For the environmental dimension, it was recommended that while the company produces environment-friendly products, it should also take into consideration the materials they are using to make such environment-friendly products and that the firm might need to consider ways to help decrease their usage and consumption of such resources. Recommendation for the social dimension on the other hand includes the need to hire more full-time employees, ensure fairness in terms of pay, redo the customer satisfaction survey, and disclosure of the firm’s social sustainability practices among others.

Language

English

LC Subject

Agricultural industries, Sustainable development—Economic aspects

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993 2022 M17 S27

Notes

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Document Type

Thesis

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