Week 1 Flashcards
what are the six capitals?
- financial
- manufactured
- intellectual
- human
- social & relationship
- natural
what do the six capitals do?
store value and can be input & output
what is financial capital?
pool of funds available for an org to use in the production of goods / provision of services
what is manufactured capital?
manufactured physical objects available for an org to use in the production of goods and providing of services
what is intellectual capital?
organisational, knowledge-based intangibles (incl intellectual property) protected by law and kept within the business
what is human capital?
people’s competencies, capabilities and experience, and their motivations to innovate
what is social and relationships capital?
institutions and relationships within and betw groups, comms, stakeholders, and their ability to share info
what is natural capital?
all environmental resources and processes that provide g/s that support org prosperity
what is an input?
the capitals the org draws upon for its business activities
what is a business activity?
the planning, design and manu of products or deployment of special skills and knowledge (service provision)
what is an output?
products/services and any by-waste
what is an outcome?
int/ext consequences (+/-) for the capitals as a result of an org’s activities
input/output sequence?
input > bus activities > output > outcome
what are some factors which may affect value creation ability?
- ext env
- purpose, mission, vision
- governance
- business model
what is the external environment?
env ext to the bus that it has no control over
what does purpose, mission and vision depend on?
the intention of the business – profit making, creating SH value
what is governance?
how the company is run / managed
will create value better if it has
what is the business model?
the way in which a company is actually run – franchise
what is the King IV Report?
a standard on corp gov principles which provide principles and practices that orgs are recommended to follow. not legislation, but some parts compulsory for JSE comps.
what are the fundamental concepts of King IV?
- sustainable development
- integrated thinking
- the org as an integral part of society
- stakeholder inclusivity
- corporate citizenship
- integrated reporting
what is sustainable development?
development that meets present needs without affecting future resources
what is integrated thinking?
taking into acc the connectivity and interdependence of all the factors that affect an org’s ability to create value
what does integrated thinking lead to?
integrated decision making that consider short, medium and long term
how is the org an integral part of society?
the org and society can both have +/- effects on each other
