South African Investment
The case study regarding operations of Caltex Company under the partnership of Texaco and Standard Oil Company in South African during the period of racial discrimination was experienced in that nation highlights various issues. The case study reveals the scope of segregation on the black natives in South Africa in various institutions that culminated to intense suppression of the community and denial of numerous human rights. Notably, the black people in South Africa formed the majority in terms of population but their representation in government institutions and workforce was minimal. Wage allocation in South Africa was not equal between the Africans and the Europeans through work description could be similar. Also, though the black African in south Africa were the natives the Europeans owned the large portions of to productive land and Africa were not allowed to own land. The fact that the level of racial segregation in South Africa was high organizations like Caltex experienced conflict between its corporate social responsibility and the governmental policies deployed in South Africa.
In the year 1977 the two partners had an expansion plan to enhance the level of production of company by building a Caltex plant in South Africa with high level of production. Apparently the expansion would generate extra income and eventually boost the economic position of South Africa. Though the company was against racial segregation policies deployed by the South African government through the process of taxation the same government the beanie African basic rights in their native land would benefit. In addition, although the company was concern with the economic aspect rather than the social tends the entire environment established by the government contradicted with corporate social responsibility and its operations indirectly funded the same government. From a personal perspective violation of ethical rights and denial of justices pose to be of paramount importance than the beneficial aspect of building a Caltex plant at South Africa.
Development and stability of corporate is highly vested on the level of interaction with the society and sensitivity to social aspects of the communities around. This dictates economic development of a company as well as facilitates enhancement of morale of the employees from the communities around the company. From this perspective Caltex ought to have demanded and pushed for elimination of racial segregation in South Africa in order to accommodate involved parties in the community rather than basing entire operations on racial discrimination. Moreover the corporate social responsibility that calls for ethical values of companies like Caltex contradicts with the social condition evident in the South Africa. Therefore, opting for termination of racial segregation pose to be important than building a Caltex plant in South Africa.
Notably the stakeholders of both Texaco and Standard Oil had to vote on the proposed resolutions to resolve the crisis at South Africa between the Caltex and the government of South Africa. The resolutions identified involved the following: recommending to Caltex Company to terminate its operations in South Africa, asking the company not to sell petroleum products to either South African military or police and asking the Caltex to embrace the principles advocated by Tutu. Voting on the resolutions was vested on various facts that would affect the company different hence evaluation of the principles was crucial in order to advocate for the most appropriate. Regarding the first resolution proposed that involved terminating the operations of Caltex in South Africa would have an adverse effect to both the African community in South Africa and the Caltex Company. Termination of the operations would result to lose of jobs to the African in the company where they received better treatment and higher pay rates.
Though the conditions established by the South African government were mounted on racial segregation voting for the resolution would not bring to an end to the practices. In this case the problem would not be solved but avoided and leaving the nation suffering from racial discrimination. On the second resolution that involved withdrawing sales of petroleum products to military and police of South Africa, voting on the resolution required a comprehensive evaluation on its implication to the company. The fact that that the government provision to make such a withdraw illegal in south Africa, voting on the resolution would subject the company illegality and hamper its operations and eventually fail to achieve its goal in promoting equality.
From this perspective it would be huge challenge for the company to operate in a country that has illegalized selective sales of products to military, police and other governmental institutions. The third resolution that entailed implementation of the principles advocated by Tutu pose to be apt platform towards eliminating racism from south Africa and promoting equality in all races. However, the process was demanding and required the company to design an inclusive process that would enable the company achieve its objectives. The fact that the company acknowledged that the conditions in South Africa were developed to favor a particular race and deny the African their fundamental rights, implementing Tutu's principles posed to be the most appropriate resolution.
The three resolutions proposed posed to be the possible solutions to racial crisis at South Africa that stakeholders would for or against depending position of respective stakeholders. In this case voting would influence operations of company in a particular direction that would have a direct implication to the company's returns and profit margins. Therefore the company's management team of both Texaco and Socal should appropriately respond to the proposed resolution bearing in mind sentiment of the stakeholders in relation to segregation as well as Caltex as a business entity. The fact that the government of South Africa was core beneficiary of Caltex operation in the country, the manager should formulate demands for the government to meet in order to establish a mutual relation with the company. In order to implement the most appropriate resolution managers should join efforts and give conditions for expansion of the Caltex operations in South Africa. Therefore in response the company should promote ethics and eliminate racial discrimination by formulating conditions that should be met by the government in order to foster expansion programs. This would create a scenario similar that of give and take where both parties involve benefits from the system.
Operation of business corporations are designed and facilitated by respective personnel competent in particular genre of expertise. Though physical participation of the management in not noticeable in various organization by play a fundamental role in ensuring that companies objectives are attained within the stipulated time frame in an standard working conditions. This not only portrays responsibility of management beyond attractive returns to stakeholders but also calls for development of appropriate working environment. The conditions that should be established are apt environment that acknowledges employees participation in various operations as well as social setting free from discrimination either from gender or racial perspective. Therefore, it is the responsibility of the management to protect its employees from social segregation that can be reflected in allocation of remuneration package. From a personal perspective management should based its decisions solely on law and rate of return on investment due to the fact it involves a broader perspective than the two aspects. The social aspect that calls for moral values within a company is crucial in making decisions thus be in cooperated in decision making process.
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