The Role Of Corporate Social Responsibility Commerce Essay

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In modern business of today, corporate social responsibility has become one of the major drivers of business organisation that support corporate performance. This report focus on how corporate organisation has integrated CSR as their major drivers of their business performance for maximization of shareholders value and profit generation. Corporate social responsibility has been currently perceived by the global business community as a tool necessary to gain competitive advantage in this complex global business environment that is too dynamic. 'Focusing on the community issues, recently, some business and organization have a privilege denied to ordinary mortals-they don't have to die, this makes them especially responsible' (Hardy, 1991). Even though the business community has been more concerned with financial issues rather than on social ones does not mean that they neglected its corporate social responsibility roles. Now the major concern of successful organizations that operates friendly in an environment are determined and committed to address both environmental and societal concerns as their major drivers of social responsibility. Using Heinz (United Kingdom and Ireland) company as a case study, their concern focuses on 'global sustainability, the environment, social sustainability and economic sustainability' (Heinz, 2010).



Being an international food manufacturing company in the world for more than 140 years now, its product has dominated the global market around the world through the sustainable agricultural commitment and energy concern that has yielded tremendous result in the practices of corporate social responsibility by parkaging innovation that is eco-friendly. The company focus on how to sustain global community which is highly dominated by its products from sustainable agriculture and energy. Efficient manufacturing processes to eco-friendly packaging initiatives. According to Heinz report (2009), 'good business is compatible with environmental stewardship'. The company has map out a lot of practicable policies that are successful implemented and integrated which has gain numerous award recognition. This recognition had been achieved as a result of its voluntary contribution that has focus on the host communities around the globe, employees' satisfaction, and safe environment practices. All this has no effect on the share holders' value because they part of the operations strategy of the company. To maintain its corporate social value, the company had developed a technique of improving sustainability measures and reduce operating costs by installing more efficient equipment, modernizing business process and implementing new technologies that will provide safe environment and add value to the communities where they operate (Heinz report, 2010). Its key points on the safe environment has been achieved through lowering the emission of GHG in agricultural sectors, supply chain and logistics management and supporting of their employees to practice safe environment at home and place of work (Heinz Sustainability report, 2010). The research section of Heinz company are working tirelessly on trying to innovate new ways of producing packaging materials that are eco-friendly and design new ways of recycling it which major aim is to achieve zero waste reduction and conservation of water for improvement of energy efficiently.

In support of these efforts, the primary focus and objective of the organization is to achieve total reduction of green house gas emission by 20% by 2015. (Heinz report, 2010). According to Elkintongton (1999), 'environmental reporting is now well established, as of course is financial reporting. But further challenges we hear for companies looking to evaluate social indicators in such areas as community, employee and supplier relationship'. The company can only achieve this target of carbon emission if the management are committed developing good policies and strategy that are practicable in ensuring that the main purpose of such policies are in practice. The result so far indicated that the company is one of the successful companies in the world that are seriously concern with the safe environment of its communities where they operate, employees, government and business partners and had been recognized with different awards on recycling, corporate responsibility and green house/ carbon reduction.

'Corporate social responsibility and reporting is therefore seen as a key driver for engaging the wider community as an important stakeholder in business activity' (Zairi and Peters, 2002). With regards to Deming (in Jacques, 1999) 'had argued on the significant of social contributions that would emerge, through the application of quality tools and techniques'.


The establishment and building of a long term legacy through its strategy of impacting positively to the society in areas of health support, food safety, greener environment and its focus on employees satisfaction and motivation. This has encouraged the communities and societies at large to build the trust on the company particularly on the areas they are located around the globe. Their major commitment is giving back to the communities what they deserved while making the profit which has been considered as the greatest corporate social responsibility practices in the world. One of the examples is the support of children around the world by providing food to under developed nations in order to fight malnutrition with their micronutrient, Local non-profit or charity organisation support, integration and implementation of safety policies and strict practices of global code of conduct (CSR, Report, 2009).

The company has been operating on the plat form of global code of conduct in the practices of corporate social responsibility in the implementation of policies that encourages business activities which reduces social costs, environment hazards and its impact and at the same time maximizing shareholder value. The World Business Council for Sustainable Development (WBCSD, 2002), explained that 'corporate social responsibility is the commitment of the business to contribute to sustainable economic development, working closely with employees, their families. The local community and society at large to improve their quality of life'. It helps an organisation to manage the cost of their business operation and how their operating activities have affected the local community and employees positively or negatively. The case study had shown how Heinz company had maintained good practices of corporate social responsibility and at the same time maximizing it shareholder values.

One of the company's strategy on the practices of CSR is through its establishment of Heinz Foundation, a non-profit making organisation that focuses on providing foods in order to improve the lives of children and families worldwide. This means of giving back to the communities around the globe what they deserve and desire as a voluntary contribution to the development and elimination of poverty in the world. This entire programme does not in any way affect the shareholders value of the organisation

The company has worn different corporate social responsibility recognition in America based on the 'Dow Jones sustainability North America Index' as one of the largest sustainability Performance Company that has human and employees' interest in mind (Heinz CSR Report, 2009), which has help to promote their brand name reputation both in Europe and America. In the same year, Heinz worn 'News Week Greener ranking' as one of the 100 greener company that focused on sustainable development in America (Heinz CSR Report, 2009) based on their impact on the environment and the green policies and reputation it has achieved to put smile on the faces of their host communities and employees.

(Adapted from CSR Report, 2009)

'CRO magazines 2009 had in the same year ranked Heinz as one of the 100 best corporate Citizen that has supported and sponsored programmes that concentrated in providing health care services to the people' (CSR Report, 2009).

(Adapted from CSR Report, 2009)

'National Business Group on health 2009 choose Heinz as the best and winner for the 2009 best employer for the healthy lifestyle awards, the organization evaluate how the company has contributed in providing good employee satisfaction, reduction in hazard environment and good employee relationship that is utmost important in workplace' (CSR Report, 2009).

(Adapted from CSR Report, 2009)


Heinz has shown their commitment and interest in developing its communities where they operate and its environment around the globe. Based on the company mission statement, (as the trusted leader in nutrition and wellness, Heinz the original pure food company - is dedicated to the sustainable health of the people, the planet and our company). 'In 2008 and 2009 respectively, the company has donated $16.2 around the world in cash and in kind products to support their communities in other to ensure safe health, food support against malnutrition, safe environment and complete customer satisfaction' (CSR report, 2009). The company is committed to achieving a sustainable growth that will benefit its shareholders, consumers, customers, employees and communities which are protected by their principles of integrity, transparency and social responsibility.

A global company that values people, their dignity and their rights in work place in the community. According to Zaira and Peters (2002), 'the key drivers for adding optimum values to societies and their communities in which specific business organization operates is through having strong commitment to corporate and social governance, having an open dialogue with external shareholders and having the determination to achieve environmental sustainability'.

Based on Johnson (2009), 'the company has been making a difference for people and the planet through building safe environment and working to achieve transparency and sustainability'. Shareholders value and stake holders interest are compatible to each other and both contribute to the success of any businesses which support corporate long term efficiency and progress. The protection of wider set of interest in corporate governance does not in any way affect the share holders value and cost of running a business if properly managed. Corporate organization need to employee management team that understood proper the business arena of today which is highly characterized competition and enabling environment that assist a firm in making progress in its operating level.

The stake holders right in determining the progress and success of an organization depends how the managements are committed in providing support to the communities, government and employees which enabled those stake holders to patronize that companies products and services there by maximizing share holders value of the organization. Organizations need to understand the important of building reputation and good image where they operate and again comply with various global regulations guiding corporate social responsibility which enable an organization to derived sustainable competitive advantages. Based on share holders theorists on good governance tend to follow Milton Friedman statement (in Carrillo, 2007) 'that social responsibility of a business is to increase the business and consider that shareholders interest in the increase in value of their shares is paramount of corporations goals'. Taking the interest of stakeholders while maximizing shareholders value is very important in business environment is a democratic idea required in this modern day business where everyone will be happy with the success of a business without complain which ensures that corporate good performance on corporate social responsibility. Kaplan and Norton (1992) 'Fair and balance stakeholders perspective result in long term share holders maximization value'. This has supported the business of Heinz globally based on their commitment to environmental responsibility in order to conserve energy and add value to agricultural produce which is more than 90% raw materials for all their products. Good governance is all about reconciliation of diverging interests which ranges from the community, employees, government, non-profit organization and other interest groups which the company has put seriously in mind and it has contributed to the success ever witness in their operating activities. They have achieved long term profitability through human resource record since the inception of the organization 140 years ago. Corporation's prestige in the communities where they operate helps in achieving long term corporative relationship that has encouraged Heinz to develop good grounds over the years for long term wealth maximization.

The expenses on corporate social responsibility of an organization and investment towards stakeholders like communities, government and interest groups etc formed the integral governance strategy of a company which is placed under scrutiny by the corporation committee such as audit committees, be timely explain to shareholders and be consistent with corporations general programme and stated Action Plans. Company accounts and governance reports must reflect expense incurred, together with their explanation of their aims and strategic approach to achieve them (Carrillo, 2007).