ICAN 2023 Corporate Strategic Management and Ethics | Mixed

Oyinbo Industries Limited is a medium-scale enterprise involved in the processing and packaging of local (traditional) food items for the Nigerian market. Its product portfolio includes Instant Elubo Powder, Instant Pounded Yam Powder, and Instant Beans Powder, all of which have been successful in the Nigerian market. The company hopes to expand its market coverage to the United States, United Kingdom, France, Canada, and United Arab Emirates, which are believed to be viable new markets for the products. To achieve these goals, the company hopes to start by strengthening its position in the Nigerian market. To this end, the management hopes to improve the market share, sales growth, and profitability of each business unit. In pursuit of these objectives, the company expanded its portfolio by introducing the following products into the market: Instant Plantain Powder, Instant Soya Beans Powder, and Garri Ijebu. The table below shows current market and sales growth for each product: The company’s current market growth rate for each of the products is over 10%. The fast-growing nature of the market is attributable to population growth and the growing concern about the hygienic conditions of food items sold in the open market. The company hopes to take advantage of this opportunity to become the biggest producer and exporter of processed and packaged food items in the country. Competitors of Oyinbo Industries Limited are largely cottage industries and small-scale producers, but command substantial share of the market. Entry into the industry is not regulated. Most of the firms in the industry rely on small farmers in the rural areas of the country, and they are many. As part of its growth plan going forward, Oyinbo Industries Limited plans to acquire a large expanse of land in Kwara State for farming. The firm hopes to use this farm to secure supply of the needed raw materials. The Company also hopes to strengthen its relationship with a local fabricator of processing equipment, which supplies the plants and machinery that the firm needs. The technology that is used in the industry has remained largely unchanged in the last 20 years. In pursuance of its growth strategy, the firm plans to leverage on its extensive distribution network and internal production capabilities to increase its market share of existing products and push the sales of the new commodities. However, the incessant power failure and frequent breakdown of the company’s equipment constitute a major concern for the management of the company.

Every business venture has some measure of risk exposure that must be identified, measured, and adequately prepared for. Indeed, each business entity should have in place a good risk management strategy.

The code of corporate governance prescribes corporate governance disclosures for listed companies.

Richard and his wife, Rachael, have just retired as top level managers from one of the biggest oil companies in the country. They have earned vast personal wealth and have ample investments in several blue-chip companies. Rachael, being a food technologist with passion for healthy living, convinced Richard to start a company that would produce organic drinks and foods from only natural ingredients. She also suggested that the company adopt environmentally friendly manufacturing processes and consider the wellbeing of all employees and other stakeholders. The primary reason for establishing the company is to fulfill a passion, build a sustainable and socially impactful business and not to aggressively pursue profit. Hence, both Richard and Rachael are happy to just break even at the initial stage of the business and later record minimal profits.

Creative and critical thinking are essential skills that chartered accountants should possess for optimal performance.

Gbam Telecoms Plc, a leading mobile phone and internet communications company, is planning to roll out its 5th Generation (5G) spectrum. As a new product, the 5G spectrum promises customers high speed internet with immense possibilities in computing, big data management, robotics and other numerous benefits. While a section of the populace believes that the roll-out is a welcome development, others express reservations about the 5G technology. Within Gbam Telecoms Plc, some employees believe that the erratic nature of the country’s power supply could damage the 5G transponders. Also, the high cost of diesel would increase the company’s operating costs, thus making the product largely unaffordable to prospective consumers. There are also security threats to the company’s facilities due to heightened insecurity in the country. The umbrella trade union for the company’s employees is also agitating for pay rise and hazard allowance should the company go ahead with the 5G roll-out. Some experts believe that the market for 5G spectrum in the country today is negligible because most telecommunication and internet devices used by consumers in the market are not 5G-compliant. There are also reports that the competitors of Gbam Telecoms Plc are studying how the market will respond to Gbam Telecoms’ 5G spectrum before deciding to enter the market. In addition, a study carried out in Europe concluded that 5G spectrum may be hazardous to the health of people living close to 5G transponders. There is also news about the development of new and better technologies called 6G and 7G, which may make 5G become obsolete within a short period of time. Consequently, the management of Gbam Telecoms Plc is concerned about the attendant risks that are associated with the 5G spectrum roll-out.