Free Essay Sample on Sustainable Development Policies

Published: 2023-11-24
Free Essay Sample on Sustainable Development Policies
Type of paper:  Essay
Categories:  Policy Management Sustainable development
Pages: 6
Wordcount: 1537 words
13 min read
143 views

Introduction

Management control refers to the mechanisms that company controllers put in place to influence individual behavior to steer organizational objectives. Primarily, controlling is a management's function that involves procedures managers implementation and accuracy to prevent possible deviations from previously set standards. Some relevant techniques that controllers utilize embody personal observation, budgetary control, break-even analysis, cost control, ratio analysis, and internal auditing. Sustainability, on the other hand, is broadly defined as the focus on meeting present human needs without compromising the ability to achieve future goals. Management control entails several techniques for steering sustainability.

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Most studies in the existing literature tend to examine managerial control and sustainability separately instead of studying them as interrelated concepts. For instance, the benefits of management control, techniques, and functions of a management controller exist in different studies that have been compiled so far in this field. In sustainability also, researchers have focused primarily on the benefits of integrating sustainability with organizational objectives as well as implementing mechanisms to promote societal welfare. However, the literature lacks a significant explanation of the extent to which management controllers get involved in the development of sustainability policies. This essay intends to fill the research gap by exploring the possible contributions of management controllers to sustainability and an evaluation of whether management control and sustainability exist differently.

Relationship Between Management Control and Sustainability

Management controllers operate with the intentions of maintaining a particular performance or production level throughout their organization or to implement new ideas that intend to bring the organization to any desired outcomes that have been set previously. In other words, it is nearly impossible for controllers to pursue their activities without having some involvement with sustainability. Although work environments can be highly susceptible to changes, management controllers can bring a sense of security as well as some sustainability to their respective firms by accomplishing and surpassing their objectives (Ussahawanitchakit, 2017).

Therefore, controllers must ensure the sustenance of the activities that they implement to maintain a certain level or rise to the desired level (Mononen, 2017). This is true because the primary goal of controlling is to enable an organization to progress from one level, often an undesired one, to the desired level (Ussahawanitchakit, 2017). More importantly, management controllers address their functions with more or less of a system thinking approach. A system thinking approach is a holistic view of how various constituent parts of an organization contribute to the overall achievement of particular goals (Mononen, 2017).

Controllers do not initiate improvements through a single approach, a particular department, or a specific policy. Instead they aim at ensuring that their organizations improve operations in all respective levels, aspects, and units. For example, a management controller cannot focus on performance targets and overlook production costs, because all areas across the same level must be monitored. In order for all of the different systems to work together to keep the company moving, managers cannot favor one particular segment or completely isolate any particular part of a company (Kuhlman & Farrington, 2010).

Likewise, professionals cannot concentrate on reducing costs without implementing mechanisms to realize desirable employee behaviors and beliefs. These managers must keep all different systems in mind in order to effectively control every aspect of an organization harmoniously. The spread of their control includes the production, inventory control, employee competencies, management style, expenditures, financial efficiencies, organizational culture, and the effectiveness of recruitment strategies (Kuhlman & Farrington, 2010).

Sustainability is a complex term that entails various perspectives. According to a study done by Kuhlman and Farrington, it is argued that sustainability originally referred to practices in forestry management (Kuhlman & Farrington, 2010). In its origin, Germans used the word Nachhaltigkeit as their implementation of the core concept of sustainability in 1713. In the initial applications, people used sustainability and its ethnic variations to guide policies related to preserving soil fertility or preventing the prey from getting extinct. The traditional beliefs behind conserving or optimizing resources were what society comprised of the dead, living, and unborn individuals who deserved some consideration in the resource allocation (Kuhlman & Farrington, 2010). Today, people continue adopting sustainability as the measure of increasing efficiency in production.

Sustainability is a central theme in economics considering that economists generally perceive resources to be scarcely available. With limited availability there is a demand to optimize expenditures (Kuhlman & Farrington, 2010). Because businesses operate primarily on the principle of profit maximization, they are likely to allocate resources to only activities that increase profits. It is important to note that implementing sustainability can increase costs throughout the process. This extra cost factor can potentially create a deterrent. In a short-term outlook, organizations might be discouraged from allocating funds towards sustainability. However, it is important to examine expenses from both a short-term and a long-term outlook to determine the maximum benefit of the distribution of funds. Despite the fact that sustainability typically comes with increased expenses upfront, it can provide more benefits to organizations in the future by growing and maintaining particular desired standards of performance.

Although sustainability is a complex term that branches into different segments, most of its definitions share common elements. For example, the existence of resource utilization, investment or expenditure, technology integration, and institutional change act harmoniously in a company. These features should maintain a country's ability or organization's ability to fulfill human needs both in the present and in the future (Kuhlman & Farrington, 2010).

Therefore, like management control, sustainability involves systems thinking that aims at fostering improvement across different aspects. As indicated previously, management controllers mostly aim at steering and maintaining the desired level of performance in an organization (Mononen, 2017). In continuation with this argument, management control appears to be the basis for sustainability. They cannot achieve the desired extent of achievement without improving all the relevant aspects of an organization –this typically promotes sustainability.

The Role of Management Controllers in Improving Sustainability

Management committed to steering an organization's sustainability develop specific mechanisms to ensure that different parts and layers of an organization maintain a certain desired level of performance or improvement. Firstly, controllers improve the company's sustainability through personal observation. In this technique, they observe patterns of production that subordinates achieve (Oswaal Editorial Board, 2019). Direct observation is indeed the oldest method of performance or behavioral monitoring. However, this is still essential today because, through observing, controllers can gain essential insights into deviations from the set behaviors and thereby initiate changes.

If the direct observation technique was forgone, controllers would have to rely on their data from others that are involved in a specific area. While insider input is helpful and worthy to add into consideration, it cannot be the only source for observation. Relying solely on this technique could hinder performance data, because it is lacking a broader and unbiased point of view from someone who is observing from a different level. Direct observation from controllers might ensure that employees maintain a certain level of performance that can steer an organization's growth.

Companies establish systems to ensure performance observations identify particular results, controls, and milestones to avoid developing a system with immeasurable results. It is essential that employees play a part in the development of performance measurement tools because they are key stakeholders in an organization’s system. Kumar, Duggirala, Hayatnagarkar, and Balaraman (2017) argued that supervisors' presence is critical for improving an organization's performance. Direct observation, or supervision, encourages employees to work quickly, carefully, and efficiently. Many workplace environments involve stressful conditions that, without some control or supervision from higher authority, may impede performance (Kumar et al., 2017). Since direct observation is more or less like supervision, it must promote production by influencing all employees to commit to fulfilling designated performance targets.

Management controllers also use budgetary control, as they need to avoid wastage and minimize spending where it is logical. Budgetary control entails a comparison of the actual performance with the corresponding budget performance to determine deviations (Oswaal Editorial Board, 2019). In case controllers identify variations, they either improve by adjusting budget estimates or mitigating the causes of the variances. Budget control is a widely-applied controlling tool for optimizing business operations due to its ability to provide a basis upon which managers can devise corrective mechanisms. Through the budget control approach, management controllers establish a particular desired performance level that becomes the basis for evaluating an organization's progress toward improvements (Oswaal Editorial Board, 2019).

For example, this measure must fully identify concrete goals, long-term and short-term, that the organization must achieve. Without specifically defining goals, it is impossible to measure improvement, consistency, or decline. A company’s clear course of direction will guide controllers to optimize resource allocation across departments, which steers sustainability. In essence, most aspects of budgetary control end up promoting sustainability in an organization.

Conclusion

Thus, a management controller committed to sustainability uses the break-even analysis in which they identify the interrelationships among production costs, production volume, and profit margins (Oswaal Editorial Board, 2019). In the break-even analysis technique, controllers identify the total costs involved in the generation of revenue at different levels of sales. Essentially, the break-even analysis enables controllers to determine the minimum sales volume at which an organization can fully recover its production costs and start earning profits (Oswaal Editorial Board, 2019). Likewise, controllers apply the technique to estimate turnover for different levels of the desired benefits.

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Free Essay Sample on Sustainable Development Policies. (2023, Nov 24). Retrieved from https://speedypaper.com/essays/free-essay-sample-on-sustainable-development-policies

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