CIMA P2 Syllabus B. Capital Investment Decision Making - Non-financial factors in LT decisions - Notes ^{2 / 6}

Non-financial considerations in long-term decisions

• Impact on employee morale 

  Most investments affect employees' prospects, sometimes for the better, sometimes for the worse. 

  A new cafeteria for employees would have a favourable impact, for example.

• Impact on the community 

  This is a particularly important consideration if the investment results in loss of jobs, more jobs or elimination of small businesses.

• Impact on the environment 

  The opening of a new mine, the development of products which create environmentally harmful waste and so on, all have an impact on the environment.

• Ethical issues 

  Some investments might be legal but might not be in line with the ethics and code of conduct demanded by various stakeholder groups.