Plantar Pig Iron Company in Brazil Essay

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Plantar's business model. What are its strengths and weaknesses?

Plantar is a raw materials company, focusing on forest management, tree plantations, and the production of pig iron from those materials. By taking the raw materials to manufacture pig iron while also engaging in reforestation, Plantar created a sustainable business model. Plantar also provides a wide range of forestry services as they diversified, from nursery administration to timber supply management. Pig iron was only one of the many areas Plantar was engaged in, but became an important part of the overall business model. As a dedicated pig iron plant, Plantar contributed to the burgeoning pig iron industry in Brazil. The business also operated with a "on the spot" purchasing model in which, unlike other commodities, did not depend on external buyers purchasing futures. Instead, the pig iron would be purchased on the spot by the buyers. Prices could also be negotiated on the spot, and were impacted by factors such as the fluctuating prices of alternative materials such as scrap metal. Supply and demand forces also impacted the price Plantar could receive for pig iron. The volatility of pig iron pricing using this model proves to be a weakness for Plantar, although the organization depends on its overall diversification, commitment to sustainability, and position in the pig iron market as core strengths. Other Plantar strengths include the organization's vertical integration, growing the eucalyptus from seed into the finished products available for sale on the market. On the other hand, Plantar contended with the fact that their forestry model with the eucalyptus plantation entailed potentially unsustainable monoculture.

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Plantar received the Forest Stewardship Council certification because their business model has been deemed sustainable. Plantar was also able to leverage its sustainability model by cashing in on carbon credits.

2. As the CEO of Plantar S.A., how would you balance corporate social responsibility with the need to earn profit? What are your local responsibilities and what are your global responsibilities?

Although Plantar practices monoculture with its eucalyptus forests, its ecological footprint is relatively low for a business of its type. The regions it plants its eucalyptus in are naturally arid, and had already been used as livestock grazing lands unsuitable for agriculture. As CEO, I would make sure that the soil composition was being regularly assessed, and ensure that the processing plant or the monoculture was not adversely affecting local residents in any way. Moreover, I would maintain that 30% of the total land area owned by Plantar was protected as per current organizational policy. I would also make sure that the enterprise was not detracting from overall regional biodiversity. My focus would be on continuing the balance between corporate social responsibility (commitment to sustainability and refraining from unethical practices like child labor and preventable pollution) and the practical need for profitability. After all, the profitability of the company is necessary to ensure its success and the success of the company will benefit local residents by providing….....

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