Impact of ISO Regulations on Stakeholders (Essay Sample)

Impact of ISO Regulations on Stakeholders
Name:
Institution:
Introduction
ISO 14001 and AA1000 demonstrate that an organization is committed to customers by ensuring that all social and environmental information on publication is correct and accurate. The stakeholders get accurate reports done through independent review. They are assured of complete scope on social and environmental reports. Stakeholder confidence increases market share of the organization enlarges due to the company’s commitment to corporate responsibility.
The ISO 14001 and AA1000 is a framework for sustainability in reporting and assurance. It facilitates the organizations in identifying, understanding and responding to sustainability issues and being accountable and reporting them to the stakeholders. Upon implementation of the accountability principles, the organization adds credibility to its sustainability reports by being assessed (URS verification, 2015). The principles help an organization move from the compliance approach to the issues and start using them as value drivers to the organization. They facilitate continuous improvements that lead to effective processes that result in accountable performance. The questions that they the certification tries to answer are what issues should an organization concern itself with and how the issues can affect the performance (Thijs, 2015).
Regulations and future investors
The shareholders are confirmed that the business is under effective management and is working in agreement with established practices regulations and standards and concerning itself with issues that may affect it performance. The existing investors have no worries over their invested money because the performance of the company keeps on improving. They are not likely to withdraw their invested money from the company because they are assured that they are going to get good returns their after. They tend to increase their investment in the long run by buying more shares from the firms. Increased funds to the company increase its competitive advantage as it can be able to investment in short-term profitable projects that can bring in more revenues. New investors are willing to invest in the company that is accountable. The number of the subscribers to the company’s shares increase and this increases the demand for the company’s shares. The company can issue its shares at a premium to raise more money for the company because of the increase in the company’s share demand. The companies certified in Saudi Arabia have witnessed an increase in the demand for their shares (Paul, 2010).
The investors are assured of continued improved and refined business operations such as the staff performance, commitment, and motivation. The firm is likely to get qualified personnel in the long-run. An increase in the productivity is likely to be recorded. Hence, more revenues will be earned. Employing employees who are innovative will ensure new ideas are brought into the company can be worked on can add value to the company’s products over other companies in the same industry. It is only through employing qualified and innovative personnel that the company’s objectives and goals can be achieved (Paul, 2010).
Regulations and the organization sustainability
The likelihood of the audits done by the internal and external customers, suppliers and other stakeholders is reduced. The company that has complied is perceived to have no any irregularities in performing its tasks. The certification adds credibility to the company’s performance that foster good relationship with its suppliers. The existing suppliers feel secure trading with a company that is complying with all the statutory regulations and placed among the best companies. The suppliers are likely to extend the duration of their credit to the company when the company is facing a financial crisis because of the assurance that the company is working at its best. With the announcement of the company’s compliance, new suppliers are always willing to trade with the certified company’s. Having many and potential suppliers assures the company to offer its customers services continuously and without causing any inconveniences due to a shortage of supplies caused by the suppliers (ISEA, 2009).
Regulations and local stakeholders
A certified company has good terms in acquiring funds to finance its projects locally. Finance institutions are always willing to finance projects initiated with companies that comply with the regulations. The financing can either be short-term such as an arrangement of bank overdrafts and long-term financing with little security requirements. A company with good financial sources is likely to take advantages of short-term investments with its reserves because it is assured to get funds from other sources in case it runs out of cash (Edwards, 2004).
Compliance with the ISO 14001 and AA1000 regulations proves to the customers that the firm is trustworthy and will deliver its services to the customers according to their promises. More market is covered by the company because the uncertainties are removed and the market opportunities expand. Potential customers will believe on the quality of the products and services offered by the company, and good relationships develop between the company and its customers. New customers are likely to come and subscribe to the products of the company because they are perceived to be among the superior in the market because no company can qualify for the certification unless there is sufficient quality satisfaction to the certifying body (ISO, 2006).
Saudi Arabia Examples
The companies engaged in social responsibilities in Saudi Arabia have witnessed an increase in their general productivity. For example, Saudi Arabian Airlines supported social responsibility summit as a strategic partner in national...