ethical and environmental

Question 1

benefits of environmental responsibility

Answer 1

• The organisation plays a part in looking after the environment that will hopefully sustain their activities for the future
• Having a positive effect on the environment will ensure the organisation gains a positive reputation
• Awards can be granted, renewable energies saves costs

Question 2

disadvantages of environmental responsibility

Answer 2

• Investment in environmentally friendly measures will be expensive in the short term eg installing solar panels
• New procedures may have to be adapted to be more environmentally friendly which can take time

Question 3

fairtrade advantages

Answer 3

• Fairtrade mark can attract customers > the price can be increased
• Producers are protected from low and volatile market prices
• Farmers’ and workers’ rights are protected > to ensure
  appropriate working conditions/fair wage/quality of life
• Can give an organisation a positive ethical image

Question 4

fairtrade disadvantages

Answer 4

• It can be time consuming and costly to become
  Fairtrade certified > certain rules and regulations
  can be difficult to meet
• Products tend to be more expensive for the consumer
• The business has a more limited choice of
  suppliers

Question 5

benefits of achieving fairtrade certification

Answer 5

• Products that are ethically produced can be charged at a higher price
• Have a competitive advantage over competitors
• Improved public image may lead to increased sales
• Cost savings through reduced packaging
• Greater staff loyalty and motivation from staff who agree with principles

Question 6

costs of achieving a fairtrade certificate

Answer 6

• reduced protective packaging can mean damaged goods
• supplies from ethical suppliers may cost more or be difficult to get
• time to train staff and embed recycling
• may have to pay for waste to be uplifted for recycling which increases cost

Question 7

benefit of an ethical business

Answer 7

• Many owners believe that acting ethically increases costs and reduces profits. For example, a business can cut costs by hiring child labour at very low wages in developing countries. Paying below average wages lowers the firm’s total costs.