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Pearson Education is the worlds largest education group and publishes textbooks, designs multimedia learning tools and develops testing programs for students ranging from post-university to pre-school. WhichÂ includes processing, test development and scoring services to governments, corporations, educational institutions and professional bodies around the world
Financial Times is an international newspaper that focusing on business likes financial analysis, data and comment and political news.
Penguin group is a fiction and non-fiction book publisher, its collection includes children's books, novels, classics, cookbooks and illustrated reference books titles under imprints, including Penguin, Dorling Kindersley, Putnam, Berkley, and Hamish Hamilton .
The three inter-related groups have, in combination, almost 36,000 employees, sales of £5,862m and operating profits of £1,226m (Pearson Annual Report 2011)
Since 1992 Pearson has had an environment policy. Later in 2000, the company intensified its commitment by joining the "UN global compact". Its aim to incorporate nine principles, referring to human rights, the environment and labour, into their working processes. Although Pearson has a limited affect on the environment issues, the company acknowledges that its supply chain may pose substantial environmental interest. Pearson has therefore extended its obligation beyond its prompt organizational borders and has lately started a process of enlisting its suppliers on environmental events, as well as human rights and labour standards concerns which are also fundamental to the global compact. Paper producers, printing and distributor are the main three groups with important environmental issues
Definition of CRS
CSR is a multi-disciplinary field and its precise definition varies according to context(Baue 2003)In 2011 October European commission had published a new policy for CSR
"Enterprises should have in place a process to integrate social, human rights, environmental, ethical and concerns into their business operations and core strategy in close collaboration with their stakeholders"
Their aim is enhance positive impact by innovation of new product or service that may be helpful to society and the company too.
There are several tools available to measure CSR by quantitatively like Dow Jones Sustainability Index DJSI 2003,BiE Index of Corporate Environmental Engagement (BIE 2003) and FTSE4GOOD 2003.These tools measure how the company is performing in social and environmental issues
According to Carter et al (2000) now day company takes CSR seriously because it represent the image of their company and brand enhancement in eye of consumers. As consumers are more aware of green environment and social issues like staff standard working condition.
According to recent survey by Aaronson (2002) 70% of consumers in Europe consider company practicing CSR before purchasing their product and 20% of consumer are ready to pay more if company practice CSR seriously.
Companies who practice CSR seriously can reduce their cost and improve their production and quality Example like recycling waste initiative dampen waste garbage and make some income through the sale of recycle material and also help employee to find greater meaning in their work, which result in higher endeavors in the organization (Schiebel 2000)
Greater level of fear has objected the traditional way of business process and environmental security as antagonistic, particular supply chain of business causes much of environmental damage(Bloemhof 1995) he also debate to rationalize supply chain damages companies should engage in joint initiative ,rather than independent attempts.
Within the publishing industry the main supplier groups which affect the environment are
i.)Pulp and paper production: Paper in the third largest industry which consuming lot of Fossil fuel and water per pound of product. However it is been most contaminated and heavy user of herbicides, effluent discharge and which leads to air pollution (Carli 2003)
ii.) Printing: Publishing industries use more than 2 million pound of ink used every year mostly made of petroleum based and many other toxic chemical for press cleaning and blanket wash. Which mix in the environment and create smog and corrosive (AIG 2003)
iii.) Distribution: According to Rodrigue people and goods has increased movement which resulted in logistic industry increment their contribution of environment impact specially carbon dioxide emission that had badly affected the green house and air pollution
According to Leal (2003) the aim of this models is to acquire continue betterment in processes that impact environment example like Evaluation program and policy. Two mostly used standards are ISO 14001 and EMAS
It has 5 stages that must be applied before getting certified. It is most commonly practice in publishing community and it is best EMS model in operation. Because of its unspecific nature of the requirement which allow it to tailor to various type of firm.
Eco-management & Audit Scheme
According to Delmas (2002) EMAS is more stringent as compare to ISO 14001.Its aim to acknowledge firm that excel their legal commitments and regularly improve their environmental performance .In order to get EMAS certified firm should abide the following four step.
As both of them are similar model still they have some difference .According to Richard(1998)
Establishment of EMAS by recognized verifier only and exhaustive environment review where as ISO 14001 just recommend it
Issuing of public statement
EMAS need to an audit cycle minimum 3 time a year. where ISO don't need any such auditing
According to IRIS (2002) companies who have certified EMAS are likely to achieve better result in environment than companies who don't have it. Still 74% of EU companies use ISO 14001 standard and only 26% use EMAS, which is mostly use by government agencies and environment regulators (Rivera Camino, 2001)
Well Pearson has created its own standard EMS with the help of consultancy firm. Pearson is not ISO 14001 or EMAS certified as most of management comprehends the cost is not worth to spend as most of the production is done by third parties
Environment & Supply Chain
There are many economic advantages in practicing CSR along supply chain like
Reduce supply chain interruption
Innovation in production and maintain superior quality and cleaner production.
Reducing overhead cost.
Many authors s (Ytterhus 1999; Lundgern 1997; Lamming 1996) debate that supplier, distribution and customers pressure can be catalyst for sustainable production in supply chain. Lamming and Hampson(1996) examined a phenomenon called multiplier effect reckoning the borrowing of environmental policies along a supply chain. In their research of B&Q, they disclosed that after an introduction of environmental buying standard in 1990s, during 1993 -1995 many suppliers with environmental policies amplified significantly from 10% to 90% in two year. Therefore environmental force along the supply chain can produce significant effect compare to legislative force alone (Ytterhus 1999)
With the help of Peter Checklands "SOFT SYSTEM" methodology which is helpful to understand relationship among each other. The final result is a "Rich picture" this describe the inter relationship among the stakeholders, the main interest of each department. This practice prove invaluable for making that, as the power maintain by many stakeholder is not distributed equally at Pearson. With this methodology we formulated a stakeholders map of Pearson.
STANDARD & POOR'S
Pearson's stakeholder list
Supply chain System of Pearson.
Identifying diverse key actors in supply chain and their relationship among them. The generic diagram of supply chain as below
The actual operation starts with intellectual property of one or many authors is channelized to Pearson. They address it by editing, layout, formatting and other technicalities .The book blueprint is taken to company who prints it. The book is printed on paper which is sourced by Pearson .Majority of this paper come from large or small paper company. Who is responsible for the whole process from wood sourcing to paper delivery. Pearson handle intellectual property, where as manufacturing and production is outsourced to third parties.
The diagram below will explain how some of environmental events change along supply chain. It is split into four parts of supply chain distribution, paper manufacturing, intellectual property and printing
Environment as strategy for Pearson
CSR department is handled by David Bell Director of Pearson who is responsible for CSR and other environment issues. Despite management understand its responsibility for society and top level commitments, Strategic director don't anticipate the environment becoming a strategic matter at the corporate level in future as company minimize its environmental effect. However operation manager who deals with suppliers foresee environmental issue will become more significant in coming future. Two different view from two different department can comprehend the same event is a different light.
Most of the employees in publishing industry are aware of CSR issues. So company like Pearson should target such creative talent within their company, CSR policies are an effective mean of doing so. This can work as a competitive advantage for Pearson
Green marketing strategy
"Green" marketing is not successful in publishing industry and will not be in future also. As authors are allow sign their right with one company at a time and books are then advertised by the name of the author. So if customer wants to buy a novel and its publishers in non "green" basis the customer has no choice and he is forced to buy the novel. Green marketing strategy work well with product like New paper(FT)and illustration books.
How Pearson can engage with their supplier regarding CSR
According to Maignan 2002 describe active supplier strategy consist of in the following stages
Supervising supplier in regular intervals
Educate the suppliers
Regular update about CSR to supplier
Communication with Stakeholder
Stakeholders feed back
Disciplinary action against Supplier who repeatedly fail to meet the requirement.
Well Pearson follows some the above procedure like:
Sending Guidelines to supplier
Stake holders communication
Environmental norms in their contract
An auditing system
Because of the limitation and understanding of Pearson's business model the suggestion will be Genric.According to data available it is discovered that top management still don't take environmental issues and CSR as strategic significance at Pearson's corporate level. It is still in inception stage
Built CSR team
Platform where employee form different department will report to the board
To make the CSR process in motion
Communication with Stakeholder
Establish a mode of communication with stakeholder via annual report or internet
To inform how and why the company is doing
To get support from stakeholders
Norms and policy the company or suppliers should follow
Set Qualitative and quantitative target for long, medium and short term
Manage Environmental Issues
Recap the policies and benchmark them
All environmental issues are address properly
To check whether the planned auctioned were executed.
Pearson can use "Green" marketing strategy of their product with the end customer. Penguin books are often bundled around the major bookstore, marketing gimmick can be apply like "Learn more" .By using powerful EMS like environmental message "a tree planted on every 10$ purchase", "increase knowledge while protecting environment", use of Eco-friendly product(Ink and Paper),Sustainable sources. A small message back of their product would attract considerable attention
Partnership with famous NGO's like "Green-Peace" or "WWF" are some of the genuine marketing strategy to gain credibility is the eye of consumer and stakeholder
Recommendation for Supply chain
As there is no environmental harm within Pearson, but along the supply chain. The easy and not costly method is to audit supplier on the environment issues request them to get certified ISO 14001 or EMAS in given time
By adopting Serious CSR team and involving in different part of the company, Company can transform its efforts into strong productive profit.