Company Vision and Mission

“WHICH ROAD DO I TAKE?," Asked Alice

"WHERE DO YOU WANT TO GO?“ Responded the Cheshire Cat

"I DON'T KNOW," Alice Answered.

"THEN IT DOESN'T MATTER,” said the Cat.“IF YOU DON'T KNOW WHERE YOU ARE GOING, ANY ROAD WILL GET YOU THERE.”

Vision Statement

InspiringLong-termDriven by and evokes passionBroad; Overarching; BriefFundamental statement of the organization’s

ValuesAspirationGoals

Why does the company exist?

3M: To solve unsolved problems innovativelyCargill: To improve the standard of living around the worldHewlett-Packard: To make technical contributions for the

advancement and welfare of humanityLost Arrow Corp: To be a role model and a tool for social

changeMary Kay Cosmetics: To give unlimited opportunity to

womenMerck: To preserve and improve human lifeNike: To experience the emotion of competition, winning,

and crushing competitorsWal-Mart: To give ordinary folk the chance to buy the

same things as rich peopleWalt Disney: To make people happy

Mission Statement

Unique purpose of the companyBasis of competition and competitive advantagesMore specific than visionFocused on the means by which the company will compete

What does the company do?

It is the mission of Advance Auto Parts to provide personal vehicle owners and enthusiasts with the vehicle related products and knowledge that fulfill their wants and needs at the right price. Our friendly, knowledgeable and professional staff will help inspire, educate and problem-solve for our customers.

Ecolab’s mission is to be the leading global innovator, developer and provider of cleaning, sanitation and maintenance products, systems, and services. As a team, we will achieve aggressive growth and fair return for our shareholders. We will accomplish this by exceeding the expectations of our customers while conserving resources and preserving the quality of the environment.

CVS will be the easiest pharmacy retailer for customers to use.

To nourish and delight everyone we serve. (Darden Restaurants)

The purpose of the Cooper Tire & Rubber Company is to earn money for its shareholders and increase the value of their investment. We will do that through growing the company, controlling assets and properly structuring the balance sheet, thereby increasing EPS, cash flow, and return on invested capital. We will provide branded products and services of superior quality and value that improve the lives of the world's consumers. As a result, consumers will reward us with leadership sales, profit, and value creation, allowing our people, our shareholders, and the communities in which we live and work to prosper.

Values Statement

• Statement of ethical priorities• Guidelines for norms and

decision making• Standards of behavior and

practices• Basis for moral courage

How do we behave?

Strategic Objectives

Operationalize the mission statementSMART(S)Indicates strategic intent – BHAG Strategic v FinancialLong-term v short-term

S stretchS stretch

What will we strive for?

Hierarchy of Goals

Values StatementValues Statement

Corporate Governance

Shareholders – “Principals”

Management – “Agents”

Board of Directors

Corporate GovernanceThe relationship among various participants in determining the direction and performance of the companyMechanisms to ensure that management fulfills its basic purpose: to promote the long-term interests of the shareholdersPrimary Participants:

ShareholdersBoard of DirectorsSenior Management

Agency Problem

Arises because of separation of ownership (principals) and management (agents)Management may act to promote their own interests at the expense of the interests of stockholders (opportunistically)

Control Mechanisms Internal

Responsible BOD Active shareholders

Management Compensation

External Takeover constraint Auditors Banks and investment analysts Regulations Media and public activists

Corporate Social Responsibility

• Corporate social responsibility encompasses not only what companies do with their profits, but also how they make them. It addresses how companies manage their economic, social, and environmental impacts.

• Corporate social responsibility generally applies to company efforts that go beyond what may be required by regulators or environmental protection groups.  

• Corporate social responsibility may involve incurring short-term costs that do not provide an immediate financial benefit to the company, but instead promote positive social and environmental change.

The Purpose of BusinessFew Trends could so thoroughly undermine the very

foundations of our free society as the acceptance of a [corporate] social responsibility other than to make as much money for the stockholders as possible (within the rules of the game). Milton Friedman

A group of people get together and exist as an institution that we call a company so that they are able to accomplish something collectively that they could not accomplish separately – they make a contribution to society. David Packard

Approaches to Corporate Social Responsibility

Economic/Legal View Businesses are legal entities and have no social or moral purposePurpose of business is to maximize owner's wealth within the limits of the lawCompliance-based ethics encourages meeting legal obligations.

Corporate Governance

Approaches to Corporate Social Responsibility

The Stakeholder ViewBusinesses are social entities and have social and ethical impact on societyPurpose of business is to satisfy the needs of multiple stakeholders including the financial interests of stockholders Integrity-based ethics encourages morally responsible behavior

Corporate Governance

StakeholdersFirm

StakeholdersAny individual or group who

can influence or is influenced by the operations of a firm

Types of Stakeholders

Primary – participation and support required for survival of the firm Inside: Stockholders, Board of Directors, Managers,

Employees, … Outside: Customers, Suppliers, Creditors,

Competitors, Governments, Community, …

Secondary – not directly involved in the activities of the firm but can have influence over its operations

Media, Special Interests, Investment & Rating Firms, Unions, …

Stakeholder Analysis

Stakeholder Analysis

Stakeholder Interest Power Consequences

Importance

Inside ……

Outside ……..

Secondary …….

Stakeholder Management

Stakeholder 1Interest and ConsequencesActions taken to address needsAssessment of continued support

Stakeholder 2

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