Impact of corporate Social Responsibility Policy
- Assess how, and to what extent, corporate social responsibility can be meshed with a
corporation’s obligation to maximize profits for its shareholders.
Organization recognizes the importance of social responsibility. For this reason, the organization
continues to emphasize on sustainable growth, and great financial returns; while simultaneously
giving back to the communities. Organizations main objective is to meet customer demands in
the food and beverage spectrum. It has scrutinized products which are associated with obesity
and has replaced them with healthier alternatives which have lower sugar and fat content, while
simultaneously meets the consumer’s demand of easily accessible snacks. To do so,
organizations invests heavily on research so as to innovate health products (Chang& Ying,
2015).
The second role of social responsibility is seen in the organization commitment to reducing its
negative impact to the environment. Organizations do so by distributing a large part of its
resources in conservation of the environment. This is done through various approaches such as
packaging initiatives where the materials are recycled to minimize waste products. The use
renewable sources of energy such as wind turbine, and solar energy conserves the environment.
Additionally, it forms partnership with communities and other organization which focuses on the
efforts of reducing environmental degradation (Tschopp & Huefner, 2014).
Organization commitment and support to its employees reflects the organization’s aspect of
social responsibility. The organization goal is to support employees of diverse culture so as to
engage positively with the people in the workplace as well as the community. Through this
approach, the organization gets the opportunity to grow due to increased new perspectives in the
community; thereby increasing creativity at the workplace. The company acknowledges the fact
that satisfied employees are the key to success and satisfied customers. The organization
collaborative culture is sustained by employing world class employees, and retaining the world
class talent through employee motivation packages. It also empowers employees through training
on leadership skills and effective management strategy. The employee’s turnover rates are
reduced and run its operation at a reduced cost, hence making immediate revenues (O’Riordan &
Fairbrass, 2013).
An organization maintains its commitment to the community and stakeholders by sustaining
high principles and standards. The organization has established code of conduct which addresses
ethical concerns in the company such as bribery. The organization has internal audit program,
and a 24-hour line which is used to report ethical violations. This gives the organization
competitive advantage. The reduction of ethical risks acts a magnet which attracts even more
investors and stakeholders (Wang et al., 2014).
- Then, assess the ethical nature of the company you selected. You may want to use the
Ethical Weather Report on page 386–387 of your text.
Corporations also share laws and regulations like normal citizens, and whenever they violate
these laws, they face penalties and fines. The role of leaders in such corporations is to sustain the
key ingredient in ensuring that the corporations sustain the ethical codes. Leaders act as
examples and role models in ensuring that desirable conduct is maintained in their organizations.
PepsiCo is an excellent example of such organization which acknowledges the role or respect,
responsibility, trustworthiness and commitment to social responsibility as indicated below
(Wang et al., 2014).
- Assess the ethical nature of the company, and provide examples of the ethical behavior
or ethical structure of the company.
PepsiCo company guiding principles include; care for the customers by selling products that
customers can relate to. Respect others; embrace cultural diversity as well as meeting both the
long term objective and short term goals. Through these guiding principles, PepsiCo
demonstrates its social responsibility and its commitment to a sustainable environment. This
way, the utility costs are reduced bringing in immediate revenues. Every company’s success is
attributable to the organization relations with the stakeholders. For this reason, PepsiCo strives to
adequately meet the need of its customers- the number one stakeholders. Secondly, the
organization meets other stakeholder expectations by providing its services with increased
integrity, honesty, transparency, and through effective communication (PepsiCo, 2010).
The employees are required to act more ethically. The managers are required to lead by
example. They are expected to lead as role models so as to inspire others. To ensure the ethical
nature of the organization is sustained, the organization rewards integrity, encourages ethical
decision making, and avoids retaliating against the employees who are bold enough to speak up.
This way, the organization creates an environment where the members feel comfortable to seek
help to solve issues which are escalating (Executive leadership, 2014). - Identify the major stakeholders and their roles and responsibilities in regards to the
issue, and explain how their stake in the issue will motivate them to do what they need to
do.
PepsiCo interacts with wide range of stakeholders who represent the community, social and
environmental interests. The organization impacts on many lives through the business, and
therefore welcomes any honest discussion with individuals so as to integrate corporate social
responsibility. Through consumers, PepsiCo offers a wide range of products which have great
taste as well as excellent nutritional value. The organization plays a responsible role in
promoting its consumer’s health and wellness. The role of customers is to inform the
organization about questions and comments they feel that the need addressed (The guardian,
2014).
In the community, the PepsiCo identifies their responsibility of improving the community by
supporting nonprofit organization and community stewards of the environment to protect and
conserve the environment. The employees are the greatest factor of PepsiCo success. The
employee’s involvement in corporate social responsibility is through talent sustainability.
Employees respond to the organizational health on issues such as working conditions, inclusion
of diversity and ways to improve their career development. The organization retail customers
contribute significantly with the marketing aspects. The retail customers also contribute on issues
which need to be improved, because they act as a link between consumers and manufacturers
(Executive leadership, 2014).
The investors are involved in every aspect of corporate social responsibility in the organization.
This includes regular conference calls done to get the investors opinion on the issues planned for
the corporate social responsibility. The commitment of investors is sustained through the
concept of sustainability, and PepsiCo applies the concept of Dow Jones Sustainability Index
(DSI) annually. The investors are attracted by the impacts of corporate social responsibility
which manifests as consistent financial growth. Other stakeholders include suppliers and
associate business such as the bottlers contribute significantly to the concept of sustainable
conservation of the environment (The guardian, 2014).
- Assess the impact of the issue on the various stakeholders, and evaluate how this issue
may affect the stakeholders in the future as well as describe the stakeholders’ likely
reaction to the issue.
There are four factors which set stakeholders reaction. This includes the individual social factor
level, the company factor levels as well as the company factor level. These factors have an
empirical capture on the variances of the CSR reactions among the stakeholders. Stakeholder’s
main aim is to provide good returns for the investment, and where they are not achieved; they
pressurize the management or could simply just sell their shares. It is important to engage the
stakeholders in CRS because their reaction provides insightful information which could increase
the business opportunities further. The reputation of the organization is improved by practicing
more charitable acts. CSR and stakeholders participation complement each other. Whereas CRS
acts as source of information, stakeholder involvement guides the information provided (The
guardian, 2014). - Next, with regards to the issue you chose for the project, assess the impact on the chosen
company and other stakeholders—including monetary, legal, and reputation-wise—of
continuing the status quo versus addressing your issue via corporate policy.
Corporate social responsibility has been found to solve businesses ethical problems. Through
CSR, the company benefit themselves while still benefiting the society. The importance of CSR
is that it encourages innovations. Through wide interactions with individuals, it results to a huge
benefit to the company and the society. Through the sustainability lens, PepsiCo has innovated
new products which are healthier and using lesser energy sources, thus saving the environment
and the society at large. CSR also contributes to cost saving. PepsiCo has managed to increase its
profit activities which results to cost savings such as using lesser forms of energy, recycling of
waste products and the use of lesser packaging materials (Executive leadership, 2014).
For instance, it is estimated that the company saved about $600,000 in 2011. CSR also
contributes significantly to brand differentiation. PepsiCo has found their voice in the market
using their corporate social values. CSR enables employees to concentrate on both the short term
and long term goals through reflective thinking. This protects the company’s future and ensures
that the company fiscal results are sustainable. CSR also increases the customer’s engagement
which enables the organization raise awareness on issues that the government needs. It promotes
good customer relationship, and business- business relations through effective communication.
Similarly, employee engagement will ensure that they establish the best strategy for maintaining
sustainability (The guardian, 2014).
- Assess the potential costs and benefits for the various stakeholders in addressing the
issue through corporate policy, and quantify the cost and benefits of addressing the issue
based on cited research and references.
PepsiCo is a leading global food as well as beverage company which records $65 billion. The
portfolio consists of about 22 brands which generate about $1 billion annually. The main
business products enjoyed across the world including; the Quaker, Gatorade, Tropicana, Pepsi-
Cola and Frito-Lay. The massive growth in PepsiCo is attributable to the unique commitment of
employees to sustain the organization growth (commitment performance) coupled with the
increased innovative approaches to reduce the impact on the environment; offer a great working
environment to the employees and increased respect to support the stakeholders and the
communities the organization operates in. The company operations are guided by the corporate
social responsibility (PepsiCo, 2010).
References
PepsiCo. (2010). PepsiCo’s journey toward an ethical and socially responsible culture.
