THE EFFECTIVENESS OF UNIVERSAL ROBINA CORPORATION ON THE ENVIRONMENTAL REGULATIONS COMPLIANCE: AN ASSESSMENT A Thesis Presented to The Faculty of the College Management and Marketing Jose Rizal University, Mandaluyong City In Partial Fulfillment of the Requirements for the Degree of Bachelor of Science in Business Administration Major in MANAGEMENT: Joy Bolo Keith Diu Ronalyn Pladero June 2013 Chapter 1. The Problems and its Background Introduction Conceptual Framework Research Paradigm Statement of the Problems and Limitations of the Study study Study 5 6 7 8 3 Scope Significance 9 10 Hypothesis of the
Assumptions of the Chapter 2. Review of Related Literatures and Studies Foreign Literatures Local Literatures Foreign Studies Studies Chapter 3. Methodology Research Design Population and Sampling Plan Sample size Formula Research Instrument Statistical Treatment Statistical Tools Survey Questionnaire Bibliography Appendix CHAPTER 1 PROBLEM AND ITS BACKGROUND 11 12 13 14 15 16 17 19 24 Local Environmental problems on both the national and global levels have become more vibrant, public awareness of these problems has rapidly risen.
Environmental concerns have also attracted the attention of academic circles and any new research areas are being explored, largely due to increased scientific research capabilities. Since the 1970s, an increasing number of industrialized relating to effective environmental regulations has been emerging with in the area of environmental economics. In this context, concern over the potential effects of environmental regulation may exert on the regulated industries in developed countries.
Some entrepreneurs claim implementing stiffer measures of environmental standards may reduce the ability of polluting industries to compete internationally, because firms have to bear the additional costs of treating nvironmental toxins or pollutants. “The only meaningful concept of competitiveness at the national level is productivity. The principal goal of a nation is to produce a high and rising standard of living for its citizens.
The ability to do so depend on the productivity with which a nation’s labor and capital are employed Productivity is the prime determinant of a nation’s long-run standard of living. “(Porter (2000) p. 160) Competitiveness as “the collection of factors, policies and institutions which determine the level of productivity of a country and that determine he level of prosperity that can be attained by an economV'(World Economic Forum- Global Competitiveness Report, 2007). This research focuses on an alternative way of looking at the interaction between regulation and competitive firms.
It conceives of the regulatory process as inherently competitive, where one company or a group of companies might support greater regulatory stringency because it provides them with a competitive advantage or a larger market. Universal Robina Corporation (URC) traced its beginnings all the way back to 1954. John Gokongwei, Jr. was doing very well then as a trader/importer. He had learned the trade when his father died before the war, and had worked hard through the war and postwar years to prosper.
However, while he thrived, he took a long hard look at his company, and correctly predicted that trading would remain a low-margin business. On the other hand, a successful manufacturer controlling its own production and distribution would command more profitable margins. Mr. John decided to construct a corn milling plant to produce glucose and cornstarch, Universal Corn Products (UCP), the first building block of the company that would become URC. For a time, business was good. However, Mr. John was still looking ahead, working with an eye towards the future.
While the business was doing very well, it was producing essentially a commodity, which a customer could easily access elsewhere. To stay ahead in the game, Mr. John had to diversify by producing and marketing his own branded consumer foods, similar to the multinational companies in the Philippines like Nestle and Procter & Gamble. In a sense, he wanted to put up the first ‘local’ MNC, borne out of their best practices. Thus, in 1961, Consolidated Food Corporation was born. Their first ‘home run’ product was Blend 45, the first locally-manufactured coffee blend, dubbed as the “Pinoy coffee”.
This became the largest-selling coffee brand in the market, even beating market leaders Caf?© Puro and Nescafe. After coffee came chocolates. Nips, a panned chocolate similar to M, were a staple of Filipino childhood. In 1963, Robina Farms started operations, beginning with poultry products. This was also the beginning of the vertical integration of the Gokong wei businesses, as the farms would be able to purchase feeds from UCP in the future. Later that decade, Robichem Laboratories would be put up, to cater to the veterinary needs of the farms of the 70s. 966 saw the establishment of Universal Robina Corporation, which pioneered the savory snacks industry in the Philippines through its Chiz Curls, Chippy, and Potato Chips, under the “Jack ‘n Jill” brand. Other snack products would follow over the years, as the company successfully introduced market leaders like Jack ‘n Jill Pretzels (pretzels), Piattos (fabricated potato chips), and Maxx (hard candy). The coming decades saw more acquisitions and expansion. In the early 1970s, the Gokongwei family entered the commodities business through the formation of Continental Milling Corporation, for flour milling and production.
The late 1980s brought the acquisition of three sugar mills and refineries, under URC Sugar. These two businesses provided stable cash flows, and allowed for further vertical integration in the supply chain, to help URC weather any volatility in the cyclical commodities markets. In line with this strategy, the late 1990s saw the entry of URC into the plastics business, through URC Packaging. The businesses became more diversified, the companies were slowly integrated in rder to streamline operations and minimize costs. In 2005, the present structure of the group was completed.
All the different companies are now organized under Universal Robina Corporation, divided into three focused groups: The Branded Consumer Foods Group, composed of BCFG Domestic (including packaging) and URC International, for the production and sale of snacks, beverage, and grocery products, The Agro-Industrial Group, composed of Universal Corn Products, Robina Farms, and Robichem, for the production and sale of animal feeds, day-old chicks, hogs, and eterinary medicine, and the Commodity Foods Group, with the Sugar and Flour divisions, for the production of flour and sugar, and for sugar milling and refining services This study will help in sustaining the company’s future operation using proper rules and regulation and will also welcome the costumer’s suggestion, concern, and opinion to the product and service that is provided of the manufacturing firm. The researchers’ herein accept the strength and weaknesses of the competitiveness of the company that may build costumers loyalty and market share satisfaction. http://www2. urc. com. ph/ ompany_history. tml Environmental management program implies effectiveness and efficiency of the production process and employee benefit when they follow the rules and regulations due to strict requirements. As a result, manufacturing companies need more continuous improvement to meet and ensure the satisfaction of regulatory and mandatory requirement from the government and other recognized institutions and bodies. Maintenance of environmental regulation must be consistent to ensure high quality products. Not done yet/in progress Statement of the Problem environmental regulations compliance. Specifically, this study sought to answer the following question: 1 .
What is the demographic profile of the respondents of the company in terms of: 1. 1 Age 1. 2 Gender 1. 3 Educational attainment 1. 4 Length of Service in the Company 2. How do the respondents assess the environmental compliance of the company in terms of: 2. 1 Consistency 2. 2 Effectiveness 2. 3 Efficiency 3. Is there any significant difference on how managers and rank and file employees of Universal Robina Corporation perceive the environment regulations in terms of: 3. 1 Environmental Management Program 3. 2 Environmental Policy 4. What are the problems encounter by respondents in compliance to environmental regulations in terms of: 4. 1 Awareness 4. 2 Performance 4. 3 Implementation 5.
Is there any significant difference on how managers and rank and file employees value the significance of environmental regulation compliance? Scope and Limitations Considering how effective Universal Robina Corporation is in compliance to environmental regulation policy, it becomes imperative for the researchers to initiate further study in order to sustain the good performance of the company according to their internal environmental regulation involvement. Companies can create competitive advantage by improving the quality than the quantity of the product towards the organizational goals and by monitoring the company’s activity to ensure the predetermined goals are met.
The study will be beneficial to the following: To the Company, this research study will serve as a basis on how effective they are in complying and promoting Environmental Regulations and could be used as reference to evaluate their employees in terms of individual compliance in their bylaws and code of conducts. To the employees, this thesis will measure the effect of environmental anagement to the stakeholders and can create awareness on the importance of strictly complying in environmental regulations. To the Society and Community, this research study ensures safety of the consumers in every product/goods they are purchasing in the market. This study also creates awareness to the people living in the vicinity of the manufacturing site, regarding the importance of environmental regulation compliance.
To the Academe, this research study provides additional insights to the professors and instructors teaching the course which can promotes a much wider and ubjective classroom discussion about the importance of environmental regulations compliance. To the Future researchers, this thesis can serve as their guide/reference in further studying the importance of environmental regulations compliance and how effective manufacturing firms are in terms of promoting strict compliance to this policy. Hypothesis/Assumption Not done yet/inprogress REVIEW OF RELATED LITERATURE AND STUDIES Taking care of the environment should be everyone’s top priority, after all if we ruin this planet there is nowhere else for us to go. Sadly, there are people hat believe we have no effect on our environment and it does not need protecting.
These individuals exploit our natural resources with total disregard to the effects of their actions. Federal and state governments have realized this problem and have created laws to stop the uninhibited abuse of our planet. Foreign Literature Guenster (2006) suggested three general causal mechanisms: (1) environmental responsibility is associated with reputational benefits, which can improve relationships with employees, customers, suppliers and lenders; (2) environmental and social responsibility can serve as a proxy for management quality; nd (3) environmental responsibility may reflect innovativeness(consistent with Porter) when environmental issues are governed proactively.
Hoekman (2006) found that the impacts of services liberalization shows that policy reforms that increase competition and improve regulatory oversight lead to improved performance in the industries concerned. Assessing the impact of policy reforms in the telecommunications sectors across 86 developing countries in Africa, Asia, the Middle East, Latin America, and the Caribbean. Rathindran (2005) found that privatization and competition led to significant improvements in performance. The authors pointed out that a reform program supported by an independent regulator produced the largest gains, an 8% higher level of mainlines, and a 21% higher level of labor productivity when compared to years of partial or no reform.
According to Meyer (2011) the political debate over environmental policy has never been as contentious or rancorous as it is today. In Washington the new congress is moving swiftly to roll back twenty-five years of environmental legislation and regulation. Less noticed by the national media, but perhaps of even greater significance, are moves toward environmental deregulation nderway in state houses across the country. Driving these efforts is the widely held belief that three decades of creeping environmental controls has strangled the of many state governments hope that untying the environmental regulation knot will unleash a new burst of economic growth.
Of course environmental deregulation will not be cost-free. Steady progress toward cleaner air, water and land will be slowed significantly, if not reversed. While this may be of small concern in still pristine states such as Wyoming, the implications for public health, ecology, and the quality of ife in state as New Jersey are direr. Protection and Preservation of rapidly vanishing wildlife, plants, habitats, and ecosystem will be weakened nationwide. Undoubtedly we will lose parts of America’s natural heritage that might otherwise have endured. Nevertheless the economic gains forthcoming from environmental deregulation might well are worth the price. According to Rotterdam (2012).
In August 2011 the European Commission (DG Environmental) appointed Ecorys to carry out a study on “incentives driving the improvement of the environmental performance of companies. ” The overall bjectives of the study was to analyze the effectiveness of incentives in changing the environmental behavior of companies (including the effects of different mixes of incentives). The research therefore focused on analyzing and understanding how incentives work, what different factors play a role in determining outcomes and what lessons might be learned as a result. We were interested particularly in what steps the EIJ and other policy makers should take in future to provide better incentives to firms, so that they decide to improve their environmental performance.
Specifically, it onsidered the role and contribution of a potential organizational environmental foot printing (OEF) initiatives in the area of incentives design. Greenstone ( 2012) the economic costs of environmental regulations have been widely debated since the IJ>S. began to restrict pollution emissions more than four decades ago through Clean Air and Water Acts. The conventional wisdom is that stricter environmental standards raise polluting firms’ costsa of production, which weakens firms’ position in international markets and raises the prices that consumers face. On the one hand, the decline in U. S. manufacturing employment rom 18 million (25. 3 percent of total US employment) in 1970 to 12 million ( 9. percent of total employment) in 2012 argues that more stringent regulations enhance productivity growth by causing firms to rationalize their operation. Local Literature (LACKS 3 MORE ITEMS) Curtiz (2004) conducted about the environment. Its manufacturing processes, which employ facilities and systems for waste water treatment, maintaining air cleanliness, energy conservation and solid waste management, are designed to make optimal use of resources while minimizing environmental impact. Devera and Sanchez (2006) assisted the Environmental and Safety Head n managing all Jollibee Stores in compliance to the environmental permitting requirements and standards as mandated by law.
Coordinates with various project related compliance certificates and permits. Coordinates with consultants, store managers, project engineers and managers regarding meetings in line with environmental documents and concerns. Attends to the store operations’ concerns in line with environmental permits. Coordinates with involved managers in the accomplishment of environmental requirements. Documents and manages all environmental clearances and permits for the stores. Review the conditions of all of the certificates, permits, and clearances to determine areas of risk/threat for the stores and recommends action plans for these. Assist and implement environmental projects for the stores.
Evangelista (2005) suggested that Environmental regulations are instrumental to internalizing the social costs of pollution which results from the production activities of polluting industries. Therefore, polluting industries should compensate society for their polluting activities. While people can enjoy cleaner natural environment, which improves social welfare, the compensation causes dditional expenses for production. Foreign studies (LACKS 3 MORE ITEMS) Palmer and Jaffe (2006) suggested that environmental regulation have a positive effect on the performance of domestic firms relative to their foreign competitors by stimulating domestic innovation. We examined the stylized facts regarding environmental expenditures and innovation in a panel of manufacturing industries.
We find that lagged environmental compliance expenditures have a significant positive effect on R expenditures when we control for unobserved industry-specific effects. We find little evidence, however, that industries inventive utput (as measured by successful patent application) is related to compliance costs. Gray and Shadbegian (2005) studied that Environmental regulation is viewed in neoclassical economics as a means of force firms to internalize external cost they would otherwise impose on society. Environmental regulation is (or rather should be), therefore, implemented in cases of market failure. Though, in principle, its necessity under conditions of market failure is uncontested in environmental economics.
Rent-ling (2008) the policies to be chosen in particular cases and the stringency of regulation are very much subject to debate. Traditionally, the neoclassical economic view has been that regulation has negative effect on productivity and competitiveness, as it leads to higher expenses by businesses and impose constraints on industry behavior. Regulation can also increase uncertainty associated with future investments, so that they are postponed. Given that investment budgets are limited, enforced R for cleaner technology can have the effect of reduced R expenditure in other, more profitable areas, such as a firm’s core. Local studies (LACKS 3 MORE ITEMS) Bonifacio B. Magtibay (2006). Sanitation as used in this book would