Essay Example on External Sustainability Reporting and Verification

Published: 2022-04-19
Essay Example on External Sustainability Reporting and Verification
Type of paper:  Critical thinking
Categories:  License Business law
Pages: 6
Wordcount: 1454 words
13 min read

ISO 14001 and AA1000 regulations have been adopted in nations to protect the stakeholders. The stakeholders of business are sometimes the investors of the business. Having rules and laws that govern a company tends to create the viability of the business hence impacting the investor's ability to invest in the business. In Saudi Arabia, several businesses are growing in different cities such as Riyadh, Jeddah and Al Khobar. The enterprises need standardized laws to govern their viability. Incorporating this standard in Saudi Arabia has been associated with numerous challenges such as lack of government support. It is essential to understand the principles of ISO certification and how they have been used to determine the viability of business and investment in the kingdom.

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The stakeholders of any business have the responsibility of maintaining the business image by making right decisions for the company. Different companies have different stakeholders associated with different roles in running the company. The output of the stakeholder is what determines if more investors will create interest in the company. In Saudi Arabia for example, the kingdom has several large cities with different forms of business hence different types of stakeholders (Williamson et al., 2006). The kingdom is growing, therefore, drawing the attention of various investors from different countries. It is for this reason that the nation has adopted the ISO certification standards to protect stakeholders and encourage more investors to invest in Saudi Arabia.

Currently, waste from different company's results in affecting the environment. It is for this reason that it is crucial to protect the environment by incorporating the ISO standards. The standards help the business to achieve both economic and environmental goals. In Saudi Arabia, there is numerous informatics consultancy company that help businesses to obtain any ISO services. The standards help a particular company to come up with a plan, design it, implement it, control it and have different ways of improving it hence economic growth as well as environmental protection(Potoski &Praksh, 2015).

The primary drivers of adopting the ISO in Saudi companies are the status, corporate image and the tendency to improve environmental performance. However, the actions of these parties to adopt the standards have been challenged by several factors. The Saudi government has failed to support this move hence failing to create appropriate legislation. The certification costs are also said to be high, and lastly, the process requires substantial documentation. Majority of the companies in the kingdom are also no aware of ISO. For this reason, few companies in Saudi Arabia are willing to adopt the ISO certification freely. It is following this reason that the government needs to come up with reforms, policies, and schemes to reduce this barrier and create easy access to implement ISO Standards (Searcy& Buslovich, 2014).

Riyadh, Jeddah, and ALkhobar are among the largest cities in the Saudi Arabia Kingdom. The cities have different business going on. For instance, Riyadh is the capital of the kingdom. The town has numerous developing companies. Currently, Saudi has attracted investors from other nations hence diluted its culture's domination in business. For investors to invest fully into the business without fearing on future risks the law and regulations in the kingdom need to fasten the adoption of the ISO certification to create standardization. ISO AA1000 regulations have been used to provide stakeholders protection (Gilbert at al., 2011). The AA100 has been implemented to create more accountability and sustainability in the business. The standards give guidance on how the business should be operated by giving assurance on its sustainability and the overall engagement expected from the stakeholders. This has been useful in reducing cultural influence into the business hence creating a neutral platform for any individual to become part of the businesses' stakeholder team.

It is important to adopt ISO since it has the following advantages. The standard identifies the impacts and aspect of the business as well as assessing them leading to pollution reduction. The standard creates the brand recognition in all parts of the globe. It is a crucial marketing strategy that that helps a business get more sales using a lesser marketing expenditure. Thirdly, an organization can quickly win tenders from the government since having the ISO standard is one of the minimal requirements by the government. Lastly, ISO has been used to help an organization streamlined hence increase the environment efficiency (Potoski &Praksh, 2015).

ISO 14001 has three obligations that a business must meet. For starters, it is critical for the business to identify its environmental legal obligations and ensure that any new obligation is identified on time. A city like Jeddah is popularly known as a business hub of the kingdom. It has numerous beaches and ports that are frequently visited by international investors. ISO 14001 ensures that stakeholders of this business are protected by creating laws that govern the environment in which the stakeholders business is operating (Potoski &Praksh, 2015). These rules are meant to help the stakeholders operate within the set boundaries and in return protect the immediate environment. In cases where a new rule is introduced, or an old rule is changed, the stakeholders must be informed on time, and they must comply (Potoski &Praksh, 2015). This is to ensure that standard services and good are offered to the customers who are in most cases, international visitors. In return, the stakeholders' image is often maintained hence encouraging investors to realize the long-term viability of the business.

Secondly, the environmental policy must comply with the set environmental regulation and law not by just writing but by also committing to fulfill what is written. Al Khobar is the other large city that is commonly known for its tourist attraction. Citizens visiting the city are often from different nations. As a result, they are accustomed to different treatment in their respective nations. Therefore, stakeholders in Saudi Arabia should ensure that the personnel in their business are trained to meet the required service provision standards to the tourists. When setting rules to govern the tourists, it is proper to document the guidelines so that reference can be done each time to ensure the provision of quality services. Documentation alone is not sufficient it is important for stakeholders to ensure that the law is applied and followed to the later to protect the business and encourage investors to see the long-term viability of the business (Aravind & Christmann, 2011).

Lastly, it is crucial to evaluate the business compliance with the identified legal requirements, and it should be done from time to time to keep track of the company's agreement, and in case there is noncompliance action must be taken. Upon creating a set of rules, their standardization can only be measured through periodic evaluations (Potoski &Praksh, 2015). Riyadh has numerous companies that need sustainability unless the performance is evaluated to ensure that the set rules are followed business is likely to fall hence discourage investors. Periodic evaluation maintains business sustainability and as a result, encourages investors to invest in the Saudi market. The evaluation also allows stakeholders to keep track of departments that are not following through with the standardization rules hence create plenty room for amendments. As a result, the company is run on the set standards result in protecting the stakeholder, promoting the business and encouraging investment in the region (Potoski &Praksh, 2015).

In conclusion, ISO 14001 and AA100 regulations have been used to protect the stakeholders and the environment from waste pollution. This is standardized rules that Saudi has found challenges implementing. The main reason the kingdom has not adopted this standard is following the lack of government support. The regulation has principles that govern business by ensuring that the business is run on set standards hence protecting the stakeholder. In the event of safeguarding the stakeholder, the investors get to learn about the business, therefore, identifying the long-term viability of the company to encourage investment from investors.


Aravind, D., & Christmann, P. (2011). Decoupling of Standard Implementation from Certification: Does Quality of ISO 14001 Implementation Affect Facilities' Environmental Performance? Business Ethics Quarterly, 21(1), 73-102. Retrieved from

Gilbert, D., Rasche, A., & Waddock, S. (2011). Accountability in a Global Economy: The Emergence of International Accountability Standards. Business Ethics Quarterly, 21(1), 23-44. Retrieved from

Potoski, M., & Prakash, A. (2005). Covenants with Weak Swords: ISO 14001 and Facilities' Environmental Performance. Journal of Policy Analysis and Management, 24(4), 745-769. Retrieved from

Searcy, C., & Buslovich, R. (2014). Corporate Perspectives on the Development and Use of Sustainability Reports. Journal of Business Ethics, 121(2), 149-169. Retrieved from

Williamson, D., Lynch-Wood, G., & Ramsay, J. (2006). Drivers of Environmental Behavior in Manufacturing SMEs and the Implications for CSR. Journal of Business Ethics, 67(3), 317-330. Retrieved from

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