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Corporate Social Responsibility
Introduction
Amway is a global business. Amway is one of the world’s largest direct sales companies. It has over 3 million Independent Business Owners (IBOs) Worldwide. UNICEF is the United Nations Children’s Fund UNICEF is the world’s leading organisation working for children. It is a global champion of children’s rights.

CURRICULUM TOPICS • Business planning/strategy • Communication • Business ethics/Corporate Social Responsibility • Stakeholders • The business environment

GLOSSARY Corporate Social Responsibility: the responsibility of an organisation to wider society. Vision: a picture usually set out in words of what an organisation is seeking to achieve.

Corporate Social Responsibility (CSR) means businesses and organisations working responsibly and contributing positively to the communities they operate in. It involves working with employees, their families, the local community and society at large to improve their quality of life. Companies that operate in a socially responsible way strengthen their reputations. In business, reputation is everything. It determines the extent to which customers want to buy from you, partners are willing to work with you and your standing in the community.

Customers willingness to buy from you

Reputation built by Corporate Social Responsibility

Partners willingness to work with you

Standing in the Community

Amway is one of the world’s largest direct sales organisations with over 3 million Independent Business Owners (IBOs) in over 80 markets and territories worldwide. It is a family-owned business with a strong emphasis on family values. Its IBOs are often couples. Many of these are raising families. They therefore have a strong bond with children. These families are more than happy to partner with Amway, who, as part of its Corporate Social Responsibility strategy, works with UNICEF, the United Nations Children’s Fund.

Amway and its IBOs

are working with

the local community and society at large

As a family company, Amway is committed to playing a part in improving the lives of children in need across the globe. In this way, the company is able to show its commitment to the support of global causes. Amway defines a global cause as ‘a social issue affecting many people around the world engaged in a struggle or plight that warrants a charitable response’. This case study shows how Amway is a business that does more than provide customers with good quality products. It shows the practical realities of Amway’s global commitment and how it plays a key role in the communities in which it operates.

Growth and responsibility
An understanding of how Amway operates as an organisation gives a clearer picture of the contribution it can make to help children in need across the globe. Amway’s vision is to help people live better lives. It does this every day by providing a low-cost low-risk business opportunity based on selling quality products.
A M W AY

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The IBOs travelled to Kilifi in 2006 to meet children and to find out what the problems are in various communities. Amway Europe has been an official partner of UNICEF and has been able to contribute over €2 million (about £1. for example. food and drinks. e. the focus is on trying to reach the most vulnerable children and pregnant mothers. Amway believes in demonstrating this caring approach and this is why it has partnered with UNICEF. These products are sold to IBOs worldwide.co. The focus is on supporting the worldwide ‘Immunisation Plus’ programme. IBOs sell to people that they know or meet.www. honesty and integrity. Only 58% of children under two are fully immunised. The IBOs are self-employed and are highly motivated. They can introduce others to the Amway business. GLOSSARY Champions: people who enthusiastically support or defend a person. The One by One programme: • helps Amway to bring its vision to life • declares what the company stands for • builds trust and respect in Amway brands • establishes Corporate Social Responsibility at a high level. In Kilifi. The strategy thus enables an organisation to turn its values into action. Since 2001. Amway encourages staff and IBOs to support its One by One campaign for children. Typical products that IBOs sell include: • personal care – fragrances. Since 2001. They act as champions spreading the message throughout their groups. which are about being honest and responsible in trading. Amway launched the global One by One campaign for children in 2003. IBOs play a key part in helping Amway to deliver its Global Cause Programme. The work of the One by One programme is illustrated by a field trip undertaken by Amway IBOs to Kenya.thetimes100. largely through preventable diseases. • 120 million children do not attend a school • 180 million children have to endure the hardest forms of child labour.g. Amway and its IBOs across Europe have been supporting UNICEF’s child survival programme. The ‘Plus’ is about using the vehicle of immunisation to deliver other life-saving services for children. a child dies from Malaria every 30 seconds • Worldwide the total figure is over 1 million children per year • Over 2. The IBOs are Amway’s links with consumers and the communities in which they operate. it is able through CSR actions to help communities to grow and prosper too. For example the ‘Plus’ could include providing vitamin A supplements in countries where there is vitamin A deficiency. It is about making health systems stronger and promoting activities that help communities and families to improve child-care practices. providing measles vaccines to children across the globe. As the Amway organisation grows and prospers. Strategy: a plan for the whole of an organisation. An important value for Amway is being a caring company. cause or principle. In other words a strategy shows how a business will achieve its goals. This involves.5 million children are infected with the AIDS-virus • More than 1 billion do not have any access to clean drinking water. Implementing a strategy involves putting that plan into action. Developing a strategy A strategy is an organisational plan. One out of ten children in Kenya does not live to see its fifth birthday.uk Amway distributes a range of branded products. Values are what a company stands for. The need is great. • In Africa.4 million). Values: what an organisation stands for. In order to give many of the world’s children a chance to live a better life. body care • skin care and cosmetics • durables such as cookware and water treatment systems • nutrition and wellness products such as food supplements. right. The aim is to increase immunisation from 40% to 70%. They work within the guidelines of Amway’s Rules of Conduct and Code of Ethics. Other elements of the programme involve seeking to prevent the transmission of HIV/AIDS to infants. Values Put into practice through The means to put Strategy these values into practice Implementation 26 . Malaria is the biggest killer with 93 deaths per day. belief.

The Corporate Partnership is a closer longer-term relationship which benefits both partners. Amway set out some clear objectives for its strategy. Effective strategies involve discussion and communication with others.uk Global strategy European strategy UK strategy GLOSSARY Amway’s Global Cause strategy involves creating responsible plans that make a difference. UNICEF Interest in CSR Wants to see the growth of the business and that the CSR strategy matches the business strategy as a whole Want to see Amway UK as a responsible caring organisation whilst helping them earn money Are concerned that the producers they buy from are responsible and produce good quality products that meet their needs Want to work for a responsible organisation that does the ‘right’ thing as well as providing them with a good living Want to partner with an organisation that shares their values and helps them raise funds 27 A M W AY . There was a clear fit between Amway’s aims to help children and UNICEF’s ‘Immunisation Plus’ programme for children.thetimes100. Amway’s strategies for corporate social responsibility are cascaded through the organisation as shown below: www. Child mortality is particularly high in developing countries because of infectious diseases. Identifying stakeholders Amway’s Corporate Social Responsibility strategy has been developed with the interests of the following stakeholders in mind: Stakeholder Global Headquarters. UNICEF Benefits from extra fundraising for children. Many children could still be alive if they had been vaccinated. The views of IBOs are influential in creating strategies for Amway. In 2005 Amway UK’s partnership was deepened through becoming an official Corporate Partner of UNICEF UK. In shaping the strategy. It recognises the importance of building good working relationships with UNICEF in each market in order to launch fundraising programmes through Amway’s IBOs and their customers.g. The six most serious diseases are Measles • Diptheria • Whooping Cough Tetanus • Polio • Tuberculosis (TB) For under £12 a child can be vaccinated against these diseases and has a fighting chance to reach adulthood. The results showed that many favoured a cause that helped children. However. From the outset. These were to: • build loyalty and pride among IBOs and employees • enhance Amway’s reputation as a caring organisation • make a real difference to human lives. The UK initiative is part of a European-wide fundraising campaign for children. research was carried out to find out which global causes IBOs support. Amway Europe IBOs Customers Staff Community partners e. Working together the two parties raise money for UNICEF.co. The objective is to raise €500. UNICEF’s world child ‘Immunisation Plus’ programme is a fitting focus for the activities of Amway UK and its IBOs.000 (about £350.000) every year until 2010 across Amway Europe. Child mortality: the number of child deaths in a certain age category. Stakeholders: groups or individuals who have an interest in the decisions made by the business.All Directors design strategies for the whole of an organisation. Amway Europe/UK Benefits from enhanced reputation and motivation of IBOs and achievement of objective of being a socially responsible business. the strategy is flexible.

it is early days in the latest chapter of a strong relationship between Amway and UNICEF. Whilst every effort has been made to ensure accuracy of information. In addition.org. Of course. Face-to-face communication: Regular meetings take place between UNICEF. Amway and its IBOs. www.000 or more IBOs) where requested. This is Corporate Social Responsibility (CSR) in action.Communicating the strategy www. Online activities: There is a micro-site dedicated to the Amway UK/UNICEF partnership on the UNICEF UK website: www. Communication also helps in putting the strategy into practice. the government. Recommend ways in which Amway could enhance and develop its impact on making every child matter. 3. 4. 5. Explain two actions that Amway and its IBOs are currently taking that involve CSR. Printed material: Amway produces a monthly magazine for all IBOs called Amagram. literature and merchandise. Through meetings with UNICEF staff. In 2005 the two organisations arranged a joint briefing day for IBO Leaders. A UNICEF stand outlines the work with speakers.uk Good. Public relations materials are also important. What do you understand by the term Corporate Social Responsibility (CSR)? 2. A number of communications media are used: 1. However. Email communication: Email is very important in the company – it plays a significant part in keeping IBOs up-to-date. Analyse the key ingredients in Amway’s CSR strategy. 3.uk/amway Amway Europe provides support for fundraising to the extent of €500.co.000) per year through selling items such as: • greetings cards • multi-cultural gifts and cards • stationery and wrapping paper • toys for children. Customer research is carried out to test customers’ views on the relationship and to find out how aware the general public is about what Amway is doing in the field of CSR. GLOSSARY Public relations: activities involved in communicating with different stakeholders such as customers. Evaluation is taking place to measure the success of the initiative in terms of meeting fundraising goals. the public and the media. Its IBOs are people who want to make a difference to the communities in which they operate and to the wider world community. The clue to Amway’s success is the careful planning of its strategy and its involvement with many stakeholders in getting the strategy right.thetimes100. Show how the strategy is designed to translate the vision into practical steps on the ground.unicef.000 (about £350. in Milton Keynes in 2006). Amway is able to discuss the vision and objectives.g. Questions 1.amway.uk 28 . The Times Newspaper Limited and ©MBA Publishing Ltd 2007. neither the publisher nor the client can be held responsible for errors of omission or commission. particularly at launch events for the initiative (e. Amway UK’s support goes well beyond these activities. 4. clear communication is essential in making sure that the CSR strategy relates directly to the company business objectives. Conclusion Amway is a family business with family values. They were able to hear firsthand experiences from UNICEF staff about their roles and UNICEF’s work as well as where the money goes.co. UNICEF attends IBO major events (usually supported by 1. 2. it involves staff fundraising events and raffles organised by the IBOs. It then passes the message on by meeting with IBOs.

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