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CSR [CULTURE AND CREDIBILTIY

IN CSR COMMUNICATION]

Master thesis: cand.ling.merc. English Author: Julia Ines Geier, 274251 Supervisor: Poul Erik Flyvholm Jrgensen
Aarhus School of Business, Aarhus University June 1st 2009

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Indhold
1. Introduction ...................................................................................................................................... 4 1.1 Problem statement ...................................................................................................................... 5 1.2 Purpose ....................................................................................................................................... 5 1.3 Theory and method .................................................................................................................... 6 1.4 Structure ..................................................................................................................................... 7 1.5 Selection of companies .............................................................................................................. 9 1.6 Delimitation ............................................................................................................................... 9 2. Corporate Social Responsibility..................................................................................................... 10 2.1 CSR communication ................................................................................................................ 11 2.2 Organisational responsibilities ................................................................................................. 11 2.3 CSR in the international food industry .................................................................................... 13 2.3.1 Results from analysis of industry specific CSR issues ..................................................... 13 2.3.2 Framework for discourse analysis..................................................................................... 17 2.4 CSR and culture ....................................................................................................................... 22 2.4.1 The organization situated in a cultural system .................................................................. 23 2.4.2 Explicit vs. implicit CSR .................................................................................................. 24 2.4.3 CSR in Denmark ............................................................................................................... 25 2.4.4 CSR in the US ................................................................................................................... 26 2.5 Summary of CSR and culture .................................................................................................. 28 3. Credibility ...................................................................................................................................... 29 3.1. Ethos........................................................................................................................................ 29 3.1.1 The dimensions of ethos ................................................................................................... 31 3.2 Operationalising ethos.............................................................................................................. 32 3.2.1 The Ethos Model ............................................................................................................... 33 3.3 Summary of credibility ............................................................................................................ 35 4. Analysis of CSR discourse ............................................................................................................. 36 4.1 Presentation of empirical material ........................................................................................... 36 4.1.1 Background for CSR profile: Arla Foods ......................................................................... 36 4.1.2 Background for CSR profile: Smithfield Foods ............................................................... 38 4.2 Analysis of Arlas CSR discourse............................................................................................ 39 4.2.1 Preliminary conclusion on Arlas CSR discourse ............................................................. 42 4.3 Analysis of Smithfields CSR discourse .................................................................................. 43 2

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4.3.1

Preliminary Conclusion on Smithfields CSR discourse ............................................. 48

5. Analysis of ethos ............................................................................................................................ 50 5.1 Arla........................................................................................................................................... 50 5.1.1 Expertise............................................................................................................................ 50 5.1.2 Character ........................................................................................................................... 54 5.1.3 Goodwill............................................................................................................................ 55 5.1.4 Conclusion on ethos analysis of Arla ................................................................................ 56 5.2 Smithfield ................................................................................................................................. 57 5.2.1 Expertise............................................................................................................................ 57 5.2.2 Character ........................................................................................................................... 58 5.2.3 Goodwill............................................................................................................................ 59 5.2.4 Conclusion on Smithfields ethos analysis ....................................................................... 60 6. Discussion ...................................................................................................................................... 61 6.1 Comparison of Arla and Smithfield ......................................................................................... 61 6.1.1 Response to problem areas ................................................................................................ 61 6.1.2 Relations to stakeholders .................................................................................................. 62 6.1.3 Providing proof ................................................................................................................. 65 6.2 Differences based on explicit vs. implicit CSR ....................................................................... 65 7. Conclusion ..................................................................................................................................... 69 References .......................................................................................................................................... 73 Appendices ......................................................................................................................................... 78

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1. Introduction
In modern society, it is not enough for companies to simply provide consumers with a satisfying product. Factors such as political consumerism, globalisation and information technology have influenced consumers to become more educated and critical. Modern consumers therefore not only demand satisfying products to fulfil their needs, but they also consider less tangible factors such as the corporate social responsibility (CSR) strategy of the company1. CSR is based on the idea that firms have responsibilities towards society and stakeholders which go beyond profit making. In order to meet the demands of their stakeholders, the trend of communicating CSR on corporate websites has increased in recent years2. As a consequence of the increase in CSR communication, the demand for guidance on how to communicate CSR was also augmented. Scholars, such as Nielsen and Thomsen3, have engaged in research on how and what to report in terms of CSR. However, other research showed that CSR does not only differ between companies, but also between cultures. Some of the scholars who have conducted research in the area of CSR and culture are Maignan and Ralston4 and Matten and Moon5. Their results showed that culture has an influence on, amongst others, the extent to which CSR is communicated and how firms present themselves as responsible CSR companies6. In terms of the extent of CSR communication, research indicated that Danish firms have traditionally communicated less openly about their CSR activities than US firms7. However, Morsing et al.8 argue that the Danish traditional approach turns towards an Americanisation and that Danish companies increasingly engage in more open CSR communication. Additionally, research showed that cultural differences have an effect on companies self-portrayal as responsible citizens, and Morsing et al.9 argue that consumers in Denmark seem to be more sceptical towards companies intention of communicating CSR than US consumers10.

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http://kommunikationsforum.dk/?articleid=12048 Morsing et al. (2006), p. 15 3 Nielsen & Thomsen (2007) 4 Maignan & Ralston (2002) 5 Matten & Moon (2008) 6 Maignan & Ralston (2002), p. 497 and Sotorrio & Sanchez (2008), p. 379 7 Morsing et al. (2006), p. 23 8 Ibid. 9 Ibid., p. 30 10 Ibid., p. 30

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1.1 Problem statement


Based on the above-mentioned research results and theories by e.g. Maignan and Ralston and by Matten and Moon, who argue for certain cultural differences in CSR communication, this thesis will examine and discuss CSR communication by a company from the US and Denmark, respectively, in order to examine the nature of cultural differences. It will also be discussed whether these cultural differences are shaped as indicated by relevant theory and previous research or whether there is evidence that Denmark moves away from its traditional CSR approach towards Americanisation. Furthermore, it is assumed that one of the cultural differences is that consumers in Denmark are more sceptical towards companies intention behind CSR communication. In this relation, the assumption is that scepticism towards CSR is reflected in the CSR communication of the Danish company, as the company needs to be more careful in portraying themselves as a credible company. The problem statement therefore is as follows: By analysing the CSR communication of a Danish and a US company, this thesis examines how the national cultures of these two firms influence the way in which CSR is communicated and portrayed. Are theories and results from previous research right about the nature of cultural differences, or is there evidence of Americanisation of the traditional Danish approach? Furthermore, this thesis will examine the assumption that Danish companies express credibility in CSR communication differently than US companies, due to more sceptical consumers in the Danish culture.

1.2 Purpose
The overall purpose of this thesis is to contribute to an understanding of how CSR is framed within the cultural bounds of the US and Denmark. More specifically, the purpose of this thesis is to study general differences in the communication of CSR, as well as how companies in Denmark and the US express credibility in the companies CSR communication. This is based on the assumption that Danish companies need to be more concerned with portraying themselves as credible CSR companies, due to consumer scepticism towards the companies intentions behind CSR.

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For both analyses the purpose is also to establish whether American and Danish companies use the traditional approach for their cultures, as established by previous research11 or whether there is evidence for Americanisation as stated by Morsing et al.12 To my knowledge, no research exists which has examined expressions of credibility in connection to cultural based differences in CSR communication. My analysis could therefore form the basis for further research in this area.

1.3 Theory and method


The next chapter aims at presenting the CSR concept and allows the identification of organizational responsibilities which are presented through Carrolls pyramid of corporate social responsibility13 and the triple bottom line14. These theories will be discussed and reflected upon in order to identify which responsibilities firms have towards society and stakeholders in todays society. The chapter will shortly present CSR communication and elaborate on tendencies and benefits of CSR communication by e.g. Morsing et al.15. Furthermore, the chapter will include a section on industry specific CSR issues. In this section, the organizational responsibilities identified earlier will help to find out which issues are emphasised by companies in the food industry in general16. For the analysis, 10 websites from companies in the global food industry will be analysed for the responsibilities and CSR issues the company communicates. The goal with this analysis is to be able to identify central and common issues which will be likely to be presented by the two companies in the case study. The results of this analysis will therefore contribute to the development of an analytical model which will be inspired by Nielsen and Thomsen17 and by Maignan and Ralston18. This model will be used in chapter 5 to analyse the CSR discourse of the two companies. In order to answer the problem statement, it is also important to define cultural theory in relation to CSR. Cultural theory will not only be discussed on the basis of existing theory, but also on the basis of previous research in this field by scholars such as Matten and Moon19, Maignan and Ralston20,
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By e.g. Maignan & Ralston (2002) or Matten & Moon (2008) Morsing et al. (2006), p. 23 13 Carroll (1999) 14 Van Marrewijk (2003), p. 101 15 Morsing et al. (2006) 16 Based on my own analysis of CSR issues of 10 companies in the food industry appendix1 17 Nielsen & Thomsen (2007) 18 Maignan & Ralston (2002) 19 Matten & Moon (2008) 20 Maignan & Ralston (2002)

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Morsing et al.21, etc. However, the cultural theory and research results will not be used in order to conduct an operational analysis of culture in the CSR communication of the two companies, but will rather serve as a framework for discussion in chapter 7. Finally, the notion of credibility will be presented in chapter 3. The approach to credibility will be based on both traditional and modern scholars such as Aristotle22, McCroskey23, Isaksson and Jrgensen24 and Lund and Petersen25. This thesis will adopt the approach of rhetorical theory where the credibility of a source is referred to as ethos. Ethos consists of three dimensions, expertise, character and goodwill. By communicating on these dimensions, companies can influence how they are perceived as credible in their communication. The notion of ethos and the three dimensions will therefore be used for the analysis of credibility (ethos) in chapter 5. In chapter 3, existing models for identification of ethos will be discussed and one will be selected for the ethos analysis in this thesis. In the comparison and discussion of the two analyses, the cultural theory and perspectives by e.g. Maignan and Ralston, Morsing et al. and Matten and Moon will be discussed and compared to the results of the analyses of the two companies. In the discussion, the problem statement of how cultural differences and credibility are shaped in the case study will be answered. Furthermore, it will be possible to identify whether there is any evidence of Americanisation in this case.

1.4 Structure
This thesis consists of eight chapters. The aim has been to make a logical and progressive structure. Therefore, there is a gradual movement from theoretical discussions to analyses to comparison and discussion of the analyses. In the introductory chapter, the content of the thesis has been outlined, delimited and structured in order to define the frame of this thesis. In chapter 2, the notion of CSR will be defined and outlined. This chapter will provide the basis for an understanding of CSR and organisational responsibilities. Furthermore, an analysis of industry specific CSR issues will identify which responsibilities companies in the food industry emphasise.

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Morsing et al. (2006) Cited in McCroskey (2001), Hoff-Clausen (2001) and Isaksson & Jrgensen (2008) 23 McCroskey (2001) 24 Isaksson & Jrgensen (2008) 25 Lund & Petersen (2001)

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On the basis of these responsibilities and the theory presented, a model for analysis of CSR issues will be created here. Furthermore, theory and previous research on CSR and culture will be presented in this chapter. This theory and research will be used as a framework for the comparison and discussion of the two analyses in chapter 7 and will thus not be part of the operational analysis. With the concept of CSR and the relation to culture explained in chapter 2, chapter 3 will present and discuss the notion of credibility and ethos. This chapter forms the basis for analysis of ethos and a model for the analysis in chapter 5 will be presented. The analyses of the two companies CSR responsibilities are carried out in chapter 4. The two companies will be analysed separately by using the model created in chapter 2. Furthermore, the analyses will also be concluded upon separately, as the two companies will first be compared in the discussion in chapter 6. In chapter 5, the companies use of ethos will be analysed by using the model and theory presented in chapter 3. Also, the companies will be analysed separately, as they will be compared and discussed in chapter 6. In chapter 6, the results of the two analyses will be compared and discussed. The cultural theory and results from previous research, which was presented in chapter 2, will be used in order to discuss and compare the results. Additionally, it will be discussed if there is evidence of Americanisation in this case study. Finally, chapter 7 sums up and concludes upon the results of the analysis as well as the discussion. Chapter 8 gives an overview over references used in the thesis, figures and tables as well as the documents included in the appendix.

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1.5 Selection of companies


The companies of the case study have been selected based on the fact that they are both global firms which have their headquarters in their national country. Both companies are leaders in the food industry, Arla as a dairy firm, Smithfield as a meat firm. Both companies emphasise CSR on their corporate websites. I have selected only companies from the food industry in that CSR issues may vary according to industry. I am aware that companies within the same industry might focus on different CSR issues. However, in chapter 2 an analysis of industry specific issues will give an overview over issues generally emphasised in the food industry. Focusing on the same CSR issues for both companies will provide a better basis for comparison and discussion of cultural differences.

1.6 Delimitation
The research in this thesis is based on a case study of two companies of different cultural settings. As this sample is so small, it is possible to go into depth with the two companies. Furthermore, it allows a specific and in depth examination of how culture influences CSR communication and expressions of ethos. As the case study only includes two companies, this thesis cannot be used to draw statistical conclusions on cultural differences between Danish and US companies in general. This thesis can therefore only serve as an exploratory study and as a basis for further research on the subject. In order to still be able to discuss and compare the two companies in a credible and professional way, the discussion of culture will be based on prior research.

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2. Corporate Social Responsibility


The purpose of this thesis is to contribute to an understanding of how CSR is constructed in Denmark and the US. In order to be able to fulfil this purpose, it is important to understand what CSR is and which responsibilities companies seem to have towards society and stakeholders in general, and, more specifically, which responsibilities companies in the food industry seem to emphasise. This knowledge will form the basis for the analysis of CSR discourse in the two case study companies. One may say that the concept of CSR is a widely discussed topic on todays business agendas and in academic circles26. However, it is not a new concept. According to Carroll, the concept of CSR has a long and varied history. However, formal writing on social responsibility is largely a product of the 20th century27. The fact that CSR has been defined in many different ways and that it goes under a variety of names, such as corporate citizenship, business ethics and sustainability, proves that CSR still is a rather complex and fuzzy concept28. Academics may not agree on one single definition of CSR, however, most include that corporate responsibilities go beyond pure profit making29. The European Commission defines CSR as a concept whereby companies integrate social and environmental concerns in their business operations and in their interactions with their stakeholders on a voluntary basis.30 According to scholars, the benefits of involving in and communicating on CSR are various31. One of the main benefits emphasised is the contribution of CSR to the companys image and reputation, which in turn has a positive influence on differentiation of the company and its competitive advantage32. In the eyes of consumers the media, legislators and investors, social and environmental responsibilities are increasingly powerful drivers of reputation.33 CSR might also add value to the product, as it might provide consumers with information about circumstances that are important to them, such as conditions for workers and animal welfare. To enjoy the benefits of CSR, the companys responsibilities must be communicated to stakeholders as they will otherwise remain ignorant of the companys efforts.

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http://kommunikationsforum.dk/?articleid=5511 Carroll (1999), p. 268 28 Ibid. 29 See e.g. Tench & Yeomans (2006), p. 97 and Carroll (1999), p.283 30 http://europa.eu/scadplus/leg/en/lvb/n26034.htm 31 See e.g. Tench & Yeomans (2006), p. 101 32 Macleod (2001), p. 8 33 Tench & Yeomans (2006), p.105 f.

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2.1 CSR communication


In recent years, consumer behaviour has changed from being passive to active, with consumers claiming more information about the products they buy and the organizations which surround them. This development and need for information presupposes that corporations communicate their CSR initiatives to their stakeholders and society, as they have to know about a companys CSR before they can form an opinion about them. McCroskey states: Any person who writes about ethics reveals to the reader more about herself or himself than about ethics"34. Companies therefore must be careful to communicate CSR in a way that benefits the company, rather than damages its reputation, e.g. by leaving the impression that the company only engages in CSR because of financial benefits or an improved reputation. Also the company must be truthful in its communication, as it would otherwise lead to untrustworthiness.

2.2 Organisational responsibilities


In order to identify organisational responsibilities to society, Carroll defines economic, legal, ethical and philanthropic responsibilities, which are demonstrated in the pyramid of corporate social responsibility35.

Philanthropic

Ethical

Legal

Economic

Figure 1 Carrolls pyramid of corporate social responsibility36

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McCroskey (2001), p. 291 Carroll (1991), p.43 36 Ibid.

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Economic responsibilities represent the basis of the pyramid, as Carroll defines the primary role of companies to be profitable in order to be able to compete on the market. The second layer of the pyramid consists of legal responsibilities, where it is expected that companies comply with the laws and regulations of the government and other institutions. Ethical responsibilities represent the third layer and consist of ethical norms about fairness and justice and include activities and practices which are expected by society and stakeholders, but which are not law. The last layer represents philanthropy, which are made up of those actions which often are associated with the firm being a good corporate citizen37. Examples of philanthropy could be engaging in programs to improve living conditions in the local community or donating money for people in social need. What Carroll does not consider, however, are environmental responsibilities which in contrast are part of the Triple Bottom Line: Profit, People, Planet38. Environmental responsibilities are of increasing importance in todays society with growing issues such as the climate change, which is widely discussed in all areas of business39. One could therefore argue that environmental responsibilities should also be considered in CSR communication. To sum up, Carroll argues that economic and legal responsibilities form the basis of the CSR pyramid, and without these, the business has no basis to exist. However, increased pressure from society and consumers forces companies to consider other responsibilities, such as ethics, philanthropy and the environment. As the goal of this thesis is to find out cultural aspects in CSR and as it in this connection may be relevant to analyse the cultural difference in the communication of basic responsibilities such as economic and legal responsibilities, the analysis of CSR discourse in chapter 5 will be based on Carrolls CSR pyramid. However, the analysis will be supplemented with environmental responsibilities, as this issue is crucial in CSR communication today, due to recent discussions on e.g. climate change and the exploitation of natural resources.

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Caroll (1991), p.43 Van Marrewijk (2003), p.101 39 Sriram & Forman (1993)

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2.3 CSR in the international food industry


In the previous section, organisational responsibilities have been identified by Carrolls pyramid of CSR as well as the Triple Bottom Line. In the following, industry specific CSR issues for the global food industry will be examined. These industry specific CSR issues will serve to create a model for identification of CSR discourse of the two companies which will be analysed later. Thereby, it is possible to distinguish between issues which can be said to be general for the food industry and issues which are company-specific. 2.3.1 Results from analysis of industry specific CSR issues The following companies have been considered in the analysis of industry specific CSR issues: Danone40, Nestl41, Kellogs42, Kraft Foods43, Unilever44, Dole Food Company45, Heinz46, Vion Food Group47, Ben & Jerrys48, Pepsi Co49. These 10 companies are not just part of the food industry. These companies are also, just as the two case companies Arla and Smithfield, large, multinational corporations from different cultural settings. The goal here is not to find issues from a specific cultural setting, but to identify the global and overall issues the food industry deals with in order to apply them in the discourse analysis later. The issues found on the companies websites were divided into the four responsibilities defined by Carroll in order to categorize the different issues. Furthermore, Carrolls four responsibilities have been supported by environmental responsibilities. Economic responsibilities Economic responsibilities are communicated by some corporations (4 out of 10) as the basis of their business operations. The corporations argue that without the financial means, the firm is not able to create value to its stakeholders and is not able to fulfil their responsibilities. This is in accordance with Carrolls argument that economic responsibilities form the basis of business operations.

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http://www.danone.com/index.php?option=com_content&task=view&id=41&lang=en&Itemid=78 http://www.nestle.com/CSV/CSVHome.htm 42 http://www.kelloggcompany.com/corporateresponsibility.aspx?id=1526 43 http://www.kraftfoodscompany.com/About/ 44 http://www.unilever.com/sustainability/ and http://www.unilever.com/aboutus/ourpeople/ 45 http://dolecsr.com/ 46 http://www.heinz.com/sustainability.aspx and http://www.heinz.com/our-company/ethics-and-compliance.aspx 47 http://www.vionfood.com/811/Socially_responsible_business/ 48 http://www.benjerry.com/company/sear/2007/index.cfm 49 http://www.pepsico.com/Purpose.aspx

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One could assume that companies do not communicate much on their economic responsibilities because the company may want to be considered as caring for e.g. people and the environment more than caring about making profits. Therefore, by communicating less on economic responsibilities and more about other responsibilities, such as the environment, they may want to signal that financial gain is not as important. Legal Legal responsibilities consist primarily of statements claiming that the firm complies with the law (7 out of 10). Some companies communicate further about internal laws, such as a code of conduct (5 out of 10). The issues observed under legal responsibilities can be said to be more general issues and not necessarily bound to the food industry, as they are important in all areas of business. They are therefore not considered as industry specific. However, this analysis makes clear that, in this analysis, 50% of corporations communicate on self-regulation of the company. However, as mentioned earlier, this should only be concluded for this analysis and is not a general conclusion, as 10 companies is too small a sample to make general conclusions. Ethical As mentioned earlier, responsibilities towards employees are included under the category of ethical responsibilities. 10 out of 10 companies communicate their responsibilities towards employees. It then depends on the nature of the company which issues are emphasised. Generally these issues deal with employees and the work environment, health and safety and diversity. For corporations operating in 3rd world countries (e.g. Dole), the issues also include non-exploitation, wages, human rights, no child labour, working hours etc. Other issues are: promoting a healthy lifestyle to consumers, which is not only emphasised by corporations with unhealthy products, but it is generally emphasised by 7 out of 10 corporations. Additionally, animal welfare is emphasised by companies, whose products have to do with animals (e.g. Vion, who works with slaughtering, processing and selling fresh meat). Furthermore, responsible marketing, dealing with e.g. marketing towards children etc., are emphasised by some of the companies dealing with unhealthy products or products for children (Kelloggs, PepsiCo). None of the two companies in our case study, however, deal with these products, therefore responsible marketing will probably not be emphasised by these companies.

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Philanthropic The results of the analysis of philanthropic responsibilities reveal various different forms of philanthropic actions. This indicates that corporations support philanthropic actions which they can identify with and often these actions are connected to their business operations and the products. One common denominator is, however, responsibilities towards the community. Almost all corporations (8 out of 10) seem to feel some kind of responsibility towards the community, be it the community in their national country or the local community where the company has business operations. Also foundations (5 out of 10) and volunteerism (5 out of 10) have been communicated broadly. Environmental In terms of environmental responsibilities, all 10 companies communicate about the protection and preservation of natural resources, including limiting the impact of business operations on the environment. 7 out of 10 companies also focused on sustainable agriculture. Agriculture has been shown to have significant effects on climate change primarily through the production and release of greenhouse gases50. Therefore the issue of sustainable agriculture is a relevant issue to address in CSR communication of food companies with agricultural backgrounds. Other issues Besides the issues identified above, one can point out that the relationship between food, health and nutrition is mentioned in many of the companies CSR communication (8 out of 10). This can be explained by the fact that consumers and society in general are becoming increasingly aware of obesity and health problems in developed countries51. The issue has also become prominent in the media and has since brought about a consumer health trend. This trend may have forced companies into considering how they can help consumers to make healthier choices, as they will otherwise risk losing consumer trust and sales. What can be observed now is that many companies, besides their regular range of food products, have a range of food products with reduced fat, reduced sugar, or otherwise more healthy choice foods. One example is PepsiCos Smart choices made easy labelling52, which consists of a label on the front of the package with e.g. calorie information. They argue that this label will make it easier and quicker for consumers to identify their needs. In this

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http://localfoods.wordpress.com/2008/06/25/greenhouse-gas-emissions-from-agriculture/ http://www.iblf.org/media_room/general.jsp?id=123788 52 http://www.pepsico.com/Purpose/Health-and-Wellness/Responsible-Marketing.aspx

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relation, many companies have also begun to communicate truth in labelling, meaning labelling that is truthful and not misleading. It is a widely discussed and criticized issue that food labels are often incomprehensible and consequently make some choices difficult for the consumer53. The companies in this analysis promoting the connection between health and food (7 out of 10) have therefore also in some form promoted truth labelling as a way to make smart choices easier for consumers. Another issue discussed by some companies was the issue of food safety (3 out of 10). The number of companies responding to this issue is surprisingly low. The reason could be that this issue is connected to the kind of product. As diseases and bacteria from meat and poultry are emphasised by the media regularly, it seems reasonable that companies providing these products need to communicate more on food safety54. As the two companies in the case study conducted later deal with dairy and meat, food safety is likely to be an issue they will emphasise. To sum up, the main issues in the food industry seem to be:
Responsibilities Economic CSR issues in the food industry Economic achievements as basis for business operations Legal Lawfulness Compliance with national law Standards and regulation Code of conduct Self-regulation Ethical Employees Workplace Diversity Health & Safety Other circumstances (fair trade, wage, working hours, payment, Employee representation etc.) Sub-issues

Responsible Marketing (will not be emphasised in relation to the case study corporations) Promoting a healthy lifestyle Nutrition Labelling

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http://www.truthfullabeling.org/issue.htm http://www.msnbc.msn.com/id/26369583/

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Animal welfare

Food safety

Environmental

Protection and preservation of natural resources Sustainable agriculture

Limiting the impact of the business operations

Philanthropic

Local community

In national country In countries where operations take place In third world countries

Foundations Volunteerism
Table 1 CSR issues in the food industry

The CSR issues in the food industry will be applied in the model presented in the next section. The CSR issues identified in this section will be called CSR issues in the food industry. 2.3.2 Framework for discourse analysis The analysis in chapter 5 will contain an analysis of Arla and Smithfields CSR discourse. This section will deal with the creation of the framework that will help identifying the CSR discourse of the two case study companies. The frameworks structure will be based on the semantic topic analysis by Nielsen and Thomsen55. The semantic topic analysis is used to examine which issues are emphasised by categorizing the companies statements into topics, such as employees, local community etc. Nielsen and Thomsen categorise citations from the companies according to the appropriate topic. For example, Loyal and motivated employees is categorised under employees whereas environmental protection and sustainable development is categorised under environment. It seems reasonable to say that the topical analysis is used to observe which issues have been emphasised and not to analyse these issues.

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Nielsen & Thomsen (2007), p. 31

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Nielsen and Thomsen state that the analysis gives us a rough idea of the reporting companies identity and self-understanding as CSR pioneers and CSR caring organizations.56 A shortened version57 of Nielsen and Thomsens table for semantic topic analysis can be seen here:
Topic Employees Local Community Environment Society Corporate Governance Etc.
Table 2 A shortened version of ielsen and Thomsens table of Topical Analysis58

Company X

Company Y

Company Z

Nielsen and Thomsens framework gives an overview over issues reported by the companies, but it does not elaborate on e.g. how the companies report on these issues or which stakeholders they feel responsible to. As the purpose of this analysis is to contribute to an understanding of how CSR is constructed in Denmark and the US, the framework used for analysis must not only be a tool to identify which issues are communicated, but also how they are communicated. By identifying how the companies report on their CSR issues, it will be possible to discuss their perspective on CSR. Furthermore, instead of the topics identified by Nielsen and Thomsen, the industry specific CSR issues (identified in section 2.3.1) will be used. This will give a more specific picture of the companies CSR as Nielsen and Thomsen do not identify e.g. animal welfare or food safety. Maignan and Ralston59 compare the extent and content of CSR communication in three European countries and the US. In order to do so, they investigate the CSR principles, processes and stakeholder issues discussed on the companies websites. They have created two tables which can be used as an operational tool to identify and categorise the CSR principles, processes and

Nielsen & Thomsen (2007), p. 30 This table has been shortened, as Nielsen & Thomsen include many topics which are not of any relevance to the analysis in this thesis. 58 Nielsen & Thomsen (2007), p. 31 59 Maignan & Ralston 2002
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stakeholder issues. The first table presents CSR principles and processes and the second table presents stakeholder issues60. The CSR principles are motivating principles followed by corporations to motivate CSR involvement and they are divided into three categories, value-driven, stakeholder driven and performance driven. It is reasonable to say that these motivating principles are likely to be different from company to company even within the same cultural boundaries. Therefore they will not be emphasised in this thesis. Maignan and Ralstons CSR processes consist of managerial procedures, programs and activities used to realise CSR in the company. The scholars identify stakeholder issues as concerns of importance to the groups that can directly or indirectly affect or be affected by the firms activities61 Below a shortened version62 of Maignan and Ralstons table for processes can be seen. Maignan and Ralston here identify and define seven processes a company can engage in based on previous research or found in their own research.
Processes Philanthropic programs The company presents a formalized philanthropic program made of clear mission and application procedures to allocate donations and grants. Sponsorships The company introduces sponsorships as a type of responsibility initiative aimed at providing assistance either financial or in-kind to a cause or charity. Volunteerism The company presents programs that allow employees to work for a good cause or charity. Code of ethics The company discusses the content and/or implementation of a code of ethics or conduct. Quality Programs The company describes a formal product/service quality program as a form of responsibility initiative. Health and safety programs The company introduces formal health and safety programs aimed at one or more stakeholder groups as a form of responsibility initiative. Management of environmental The company discusses activities aimed at diminishing the negative impact impacts of productive activities on the natural environment.

Maignan & Ralston (2002), p. 501 ff. Ibid., p. 498 62 The table has been shortened as the original table by Maignan & Ralston includes results from their analysis, which are of no relevance here.
61

60

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Table 3 A shortened version of Maignan and Ralstons original table of categorization of CSR processes63

Maignan and Ralstons table of stakeholder issues can be seen below. Here the scholars identify five stakeholder groups and give detailed suggestions for which issues could be of importance to these groups.
Stakeholder issues Community stakeholders Arts and culture: The company discusses its support of organizations, activities, actors, and objects linked to the arts or the national culture Education: The company presents its support of activities aimed at improving educational opportunities and the quality of the education received by populations outside the firm. Quality of life: The company expresses its dedication to improving the quality of life and well-being of the communities in which the firm operates, or of society as a whole. Safety: The company displays concern for the preservation of the natural environment either in general or in the communities where the firm operates Protection of the environment: The company shows concern for the preservation of the natural environment either in general or in the communities where the firm operates Customer stakeholders Quality: The company presents the achievement of high product/service quality as part of its commitment to social responsibility Safety: The company displays concern for the safety of its customers in relation with its production activities or products/services. Employee stakeholders Equal opportunity: The company expresses its commitment to giving the same chances in recruitment and promotion to all employees regardless of race, gender, age, or handicap. Health and safety: The company expresses its concern for protecting the safety of employees in the workplace along with their overall health level. Shareholders The company expresses its commitment to the involvement of shareholders in corporate governance and/or to the proper information of shareholders. Suppliers The company expresses its dedication to giving equal opportunities to suppliers in terms of gender, race, and size and/or to assuring suppliers safety.
Table 4 Maignan and Ralstons table of categorization of the stakeholder issues64

63 64

Maignan & Ralston (2002), p.501 Maignan & Ralston (2002), p.503

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To sum up, the final framework for the discourse analysis in chapter 5 will therefore include industry specific CSR issues as well as it will have elements from the both Nielsen and Thomsens and Maignan and Ralstons models. Nielsen and Thomsen provide the element of semantic topic analysis, which makes it possible to identify which responsibilities the companies communicate. Maignan and Ralstons notions of processes and stakeholder issues help to identify which processes are used to realise the responsibilities and which stakeholders the companies seem to feel responsible for. The framework will therefore be able to provide a complete picture of the scope of the issues presented on the companies website. Besides CSR issues in the food industry, CSR processes and stakeholder issues, the framework will also contain a column called placement of issue. This column will deal with the placement of the issue on the website, e.g. whether economic achievement is situated in a section of its own or communicated in relation to employees or the like. This makes it possible to identify how important the company seems to find the communication of the issue65. Below, the final framework for analysis of CSR discourse in chapter 5 is outlined:

CSR issues in the food industry

Placement of issue

CSR processes

Stakeholder issues

Economic achievement

Compliance with law

Employees

Healthy lifestyle

65

Nielsen & Thomsen (2007), p. 39

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Animal welfare

Food safety

Protection and preservation of natural resources

Community

Foundation

Volunteerism
Table 5 Julia Geier's model for analysis of CSR discourse

2.4 CSR and culture


The previous section defined general organisational responsibilities and examined which issues companies in the food industry generally emphasise. With these issues in mind, the chapter introduced a framework for analysis of CSR issues on the website which will be used in chapter 5. The theory necessary for analysing the CSR discourse of the two case-study companies has therefore been defined. This leads to the subject of CSR in relation to culture. The theory of CSR and culture in this chapter will not be used in the analysis. The theory presented here will serve as a framework for the discussion of the two analyses in chapter 7. In this chapter, different views on CSR and culture will be introduced in order to get a varied overview over the connection between CSR and culture and relevant theory. Scholars presented in this chapter, such as Kampf66, Matten and Moon67 as well as Morsing et al.68,
66 67

Kampf (2007) Matten & Moon (2008)

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suggest that the CSR framework of a company is dependent upon the institutional characteristics in which they operate and the legacy reflected by the culture, history, and policy of the specific culture. 2.4.1 The organization situated in a cultural system To broaden the understanding of a corporation as a situated element in society, Kampf69 proposes the below figure in order to demonstrate how contextual elements in society influence and are influenced by the corporation.

Outside influences: World Economy Technology

Origins or ecological factors: Political Groups Governments Suppliers

orms: Coming from: Employees Communities Customers Managers

Institutional consequences: Organisations Trade Associations Investors NGOs

Figure 7 Kampfs model of the organization and its stakeholders situated in a cultural system70.

As opposed to Donaldson and Prestons71 model, where the corporation is placed in the centre of the system, surrounded by its stakeholders, Kampfs model places the firm as an element in the system. Donaldson and Prestons model implies that the most important interactions are those directly going on between the corporation and its stakeholders, however, Kampfs model includes those interactions that may not directly connect to the firm, but which influences the firm in one way or another. The model also shows how the social environment and institutions, such as the government, influence the norms set by e.g. employees and communities and thereby also the corporation. The cultural systems model will be used in section 3.3.1 and 3.3.2 in order to demonstrate how the cultural system influences the corporation and its interactions with different elements in the larger system. The next section will also include the notion of explicit vs. implicit CSR by Matten and Moon.

68 69

Morsing et al. (2006) Kampf (2007), p. 44 70 Ibid. 71 Donaldson & Preston (1995), p. 69

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2.4.2 Explicit vs. implicit CSR In their research, Matten and Moon72 use the national business systems approach, which identifies iden four key features of national institutional frameworks frameworks. . Two of those will be presented here: the political system and the cultural system. In connect connection ion with this approach, Matten and Moon establish the conceptual framework of implicit and explicit CSR, where explicit CSR refers to corporate policies that lead companies to voluntarily assume responsibility for selected areas of interest to society. Implicit CSR on the other hand is embedded in the business-society-government business relation within a society that can be called state state-defined.

Explicit CSR
Describes corporate activities that assume responsibility for the interests of society Consists of voluntary corporate policies, programs, and strategies Incentives and opportunities are motivated by the perceived expectations of different stakeholders of the corporation

Implicit CSR
Describes corporations' role within the the wider formal and informal institutions for society's interests and concerns Consists of values, norms, and rules that result in (often codified and mandatory) requirements for corporations Motivated by the societal consensus on the legitimate expectations of the roles and contributions of all major groups in society, including corporations

Figure 8 Matten and Moons explicit and implicit CSR73

In the following, CSR in Denmark and the US will be presented by using the feature political and cultural system of the national business systems approach. In relation to the two systems, Matten and Moons framework on implicit and explicit CSR will be applied ied to Denmark and the US as well as it will be supplemented with results from research by other scholars74.

72 73

Matten & Moon (2008) Ibid, p. 410 74 As e.g. Morsing et al. (2006) , Kampf (2007) and Maignan and Ralston (2002)

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2.4.3 CSR in Denmark Danish studies have found that Danish consumers generally are sceptical towards CSR communication75 and that is why corporations in Denmark face great challenge to communicate CSR in a way that is credible, yet still gives consumers the necessary insight into the firms CSR initiatives. Political system One might argue that the government in Denmark generally engages in CSR and social activities. An example is that Denmark has a nationalized social system, e.g. insurance system for health, pensions etc. Danish society is a state defined welfare society76, where the state has the responsibility for peoples well-being77. Companies therefore are part of a business-state-society relationship where formal institutions, such as Dansk Industri (The Confederation of Danish Industry) integrate the social responsibility of companies in e.g. laws, regulations and mandatory requirements78. Danish firms have therefore already established their social responsibility, as they are part of a community working towards the common welfare.79 Maignan and Ralston80 have conducted research on EU and US companies. Their results are that EU companies tend to describe their CSR engagement in a broader social context, while the US companies focus on the corporation as the centre of CSR activities. These results confirm the above statements of the role of the state in Denmark. Additionally, Werhane and Freeman81 agree that European cultures traditionally place great trust in their government and emphasise that businesses, together with the formal institutions and government, have collective responsibility for the social good and not individual responsibility82. Cultural system The Danish culture also has influence on the CSR concept and CSR communication. Morsing and Schulz argue that, in the Danish culture, consumers see the open account for CSR and philanthropy as very American. They would see it as taking advantage of other peoples misfortune in order to
75 76

Morsing & Schulz in Morsing et al. (2006), p. 136 Morsing et al. (2006), p. 24 77 Kampf (2007), p.41 78 Morsing et al. (2006), p. 25 79 Ibid., p. 24 80 Maignan & Ralston (2002) 81 Werhane and Freeman (1999), p. 76 82 Ibid.

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be seen as a good corporate citizen. So instead of bragging about it, the Danish tradition in relation to CSR is rather toned down, where the company engages in sponsorship or philanthropy without communicating about it themselves. Instead it is communicated through the media or expert assessments.83 In contrast, a study conducted in Scandinavian countries showed that 90 % of the general public find that corporations should be responsible to more than just their shareholders84. It therefore seems as if consumers find it important for corporations to behave responsibly, but not to talk about it. However, the impact of CSR on Danish consumers calls for more research and will not be regarded further in this thesis.85

Outside influences: Global focus on CSR Stakeholder expectation

Origins or ecological factors: History of state as the protector of the people Collective responsibility for social welfare

orms: Concern for social welfare Concern for the environment Contribute to society through high taxes

Institutional consequences: State as regulator State as provider of social services Businesses as needing modest amounts of CSR in external communication.

Figure 9 The organization and its stakeholders situated in the Danish cultural system86.

2.4.4 CSR in the US Studies indicate that 80% of US consumers consider CSR an important characteristic for their purchase decision87. However, where there is scepticism towards businesses and CSR communication in Denmark, it seems as though in the US, there is scepticism towards the government and state-defined well-being.

83 84

Morsing & Schulz in Morsing et al (2006), p.30 Morsing et al. (2006), p 14 85 Ibid, p. 30 86 Kampf (2007), p.48 87 Morsing et al (2006), p. 14

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Political system In contrast to the Danish institutional system, US businesses have long traditions of selfgovernance, where the state exercises minimal legislative control and does not provide the extensive social services available to all citizens in Denmark.88 As the government is not seen as being responsible for the well-being of the people, US businesses have established traditions of philanthropy, as they need to establish their place in the community through caring for the people and the community89. Cultural system The high level of individualism in the US culture and the before mentioned scepticism about government led to a tradition of businesses having internal policies in order to police themselves as well as external communication to demonstrate CSR90. Internal policies such as employee representation and participation are covered by dense employment regulation and protection in Denmark. These issues are part of CSR in the US.

Outside influences: Global focus on CSR Stakeholder expectation

Origins or ecological factors: History of state as a threat to peoples well being and therefore focus on minimizing its power

orms: Concern for business practices Concern for the money of shareholders/ owners Contribute to society by choice

Institutional consequences: High degree of self regulation for businesses Businesses needing CSR in external communication

Figure 10 CSR situated in the US cultural system91

88 89

Kampf (2007), p. 47 Ibid, p. 48 90 Ibid, p. 47 91 Ibid, p.48

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2.5 Summary of CSR and culture


Matten and Moon argue that the implicit approach does not need to emphasise the same issues as the explicit approach, as many of the issues are already presented by the state. Alas also argues that some societies do not need to communicate ethics to the same extend as others, however, she bases this on the desire of ethics and not on traditions or national systems. Morsing et al. argue that even though the traditional approach to CSR in Denmark is implicit, Danish companies increasingly engage in visible activities as a consequence of global focus on CSR and stakeholders expectations for more visible CSR efforts92. Additionally, CSR is gradually more seen as a competitive advantage for corporations. Morsing et al. call this development for Americanization93. At any rate, Morsing et al. argue themselves that Danish businesses are forced to develop and articulate CSR - an approach which goes more from implicit to explicit without disregarding their traditions for close interaction with the state and institutions94. Concluding one can say that the scholars mentioned in this section agree that the reason for the differences in CSR communication can be found in the way society is build up around institutions and norms. By institutions, it is here referred to the definition given by Matten and Moon95 which, beside the formal organization of government and corporations, also includes norms, incentives and rules.

92 93

Morsing et al. (2006), p. 23 Ibid, p. 23f. 94 Ibid, p. 28 95 Matten & Moon (2008), p. 406

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3. Credibility
In the previous chapter, research and theory on CSR and culture have been presented. In the chapter it was established that consumers might be sceptical towards the intention of the companies commitment to CSR, as it is increasingly used strategically as a marketing tool to improve the reputation of companies. Morsing and Schulz argue that, in the Danish culture, consumers regard the open account for CSR as taking advantage of other peoples misfortune in order to improve their reputation96. Consequently, companies have to ensure to appeal credible in their communication about CSR activities. Throughout more than two thousand years, rhetorical scholars have been concerned with the role of credibility in communication. From among many rhetorical scholars, Aristotles view on credibility has been assigned the most support and much modern empirical research has been based on his views. Among the researchers who grounded their studies on his views can be named, Hovland, Berlo et al., McCroskey, Tuppen, Lund and Petersen and many more. According to Aristotle, persuasion can be created through the use of the three appeals: logos, pathos and ethos. Logos describes the appeal through reason, pathos is the appeal through emotions and ethos defines source credibility97. Aristotle argued that persuasive communication would contain all three appeals. While the goal of this thesis is to find out whether there are cross-cultural differences in the CSR discourse and the self-portrayal of two firms, the notion of ethos will be dealt with in this thesis, while logos and pathos will not be regarded here.

3.1. Ethos
As mentioned above, ethos defines source credibility and it is also often regarded as a synonym for credibility98. However, academics do not agree on where in the communication process ethos is situated as such. Some academics, e.g. McCroskey argue that the receiver has ethos and not the source, as they believe that ethos exists in the mind of the receiver. Ethos is therefore the attitude of the receiver towards the source of communication99. Other scholars, such as Hoff-Clausen100 and Isaksson and Jrgensen101 understand Aristotles view on ethos as the personal credibility which a source can strive to achieve in communication. Ethos thereby becomes a technique to be used for

96 97

Morsing & Schulz in Morsing et al. (2006), p. 136 Fem Nielsen (2004), p. 285 98 Lund & Petersen (2001), p. 121 99 McCroskey (2001), p.84 100 Hoff Clausen (2002), p.39 101 Isaksson & Jrgensen (2008), p. 369

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self representation. Isaksson and Jrgensen even design an analytical model for identification of ethos in a written text (see section 4.2.1) 4.2.1). One must therefore assume that a source can make use of the rhetorical strategy ethos in order to portray itself as a credible company. If it would be only the receiver who has ethos, these scholars would not have been able to identify ify ethos in a written text. However, McCroskey may have ve a point in claiming that the use of ethos does not indicate whether or not the receiver of the communication mmunication is persuaded by ethos, and one can therefore not comment on whether the communication is perceived as credible, one can only attempt to identify how the source urce wants to establish credibility credibility. Lund and Petersen argue for a trichotomy model of credibility, where the interaction of ethos, image and identity form credibility. Lund and Petersen argue that, in n order to have a stable trustworthiness, all three need to be identical102.

Identitet

Credibility

Ethos

Competence Moral character Goodwill

Image

Figure 11 Lund and Petersens model of credibility

Lund and Petersens definition of image as the sources desire to appear in a certain way, stands in contrast to the way image is seen traditionally traditionally- as the way the receiver perceives the source103. Lund and Petersen furthermore agree with McCroskey on the view that ethos is the receivers perception of the source and the evaluation of how credible the source is104. As discussed scussed earlier, some scholars focus on ethos as a rhetorical technique to self-portrayal, portrayal, which can have an effect on image. image This is
102 103

Lund & Petersen (2001), p. 129 f Fill (1995), p. 435 104 Lund & Petersen (2001), p. 121

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also in line with the traditional view that image cannot be controlled, but that it may be possible to influence image through e.g. communication. However, it is reasonable to say that it is only appropriate that ethos is consistent with the sources identity, as it may otherwise not be credible. It might appear self contradictory to identify ethos in a text if it is assumed that ethos merely exists in the mind of the receiver. Consequently, this thesis takes on the approach that ethos can be used as a technique to convey human character through language105. 3.1.1 The dimensions of ethos In order to establish persuasive ethos, Aristotle determines three dimensions106: Phronesis: intelligence Aret: moral character Eunoia: goodwill

These dimensions have been subject of many speculations through the years. An empirical study carried out by Hovland et al. identified the dimensions as expertness, trustworthiness and intention toward the receiver107. The study shows that the three academics agreed with Aristotle on the point that a source can establish credibility through his knowledge of the subject, the level of trustworthiness and the attitude toward the well-being of the audience. Later studies were conducted mainly through factor analysis, which consists of finding a small number of fundamental dimensions108. In this way, Berlo et al. discovered three dimensions, competence, trustworthiness and dynamism. The first two are nearly identical with Aristotles dimensions. However, dynamism has little in common with Aristotles goodwill. It is rather concerned with the activity or liveliness of the source and not with the evaluation of whether or not the source is perceived as credible109. McCroskey also conducted factor analysis and he also found two dimensions which resembled Aristotles and Berlo et al.s findings. He labelled the three dimensions authoritativeness, character and perceived caring110. As one can see from the above discussion of different academics research trough the years, time after time two or all three of Aristotles dimensions are directly comparable with the findings of newer research. For this reason, and because Aristotles dimensions still serve as point of origin for

105 106

Baumlin & Baumlin (1994), s.12 Referred to in McCroskey, p. 85 107 Ibid, p. 85 108 Fem Nielsen (2004), p. 285 109 McCroskey (2001), p. 85 110 Ibid p. 86

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many studies, this thesis will focus on the original dimensions of Aristotle in the analysis of ethos in chapter 6. However, the first dimension will be called expertise, in accordance with Isaksson and Jrgensen (see section 3.2.1). Expertise is more relevant in terms of analyzing the self representation of organizations, as organizations cannot possess intelligence as a human being.

3.2 Operationalising ethos


As mentioned earlier, many of the studies conducted in the field of ethos base their studies on factor analysis, where a panel is provided with a list of adjectives describing characteristics which can be related to credibility. The panel will then evaluate a source according to this list of characteristics. Despite the relevance of these characteristics as an evaluation for trustworthiness, little research has been conducted on how to identify these characteristics in a source of communication. Which statements signal competence or character to the receiver? Lund and Petersen have in their credibility analysis model tried to operationalise ethos by making it suitable for textual analysis111. They have clarified a range of parameters with matching questions belonging to each of the ethos dimensions of competence, character and presence, as they call the third dimension of ethos. Hereby Lund and Petersen make analysis of the three dimensions of ethos possible. However, it can be discussed whether their model is applicable in praxis, as their descriptions and questions are relatively broad and they do not provide any specific strategies on how to identify competence, character or presence, respectively. In line with Lund and Petersen, Isaksson and Jrgensen have also produced an analytical model which can be used to identify ethos in a written text112. In contrast to Lund and Petersen, Isaksson and Jrgensen have conceptualized eleven concrete parameters matching the three dimensions of ethos. Additionally, each of these eleven credibility appeals are tailored to corporate communication and explained in detail113. This model will therefore be used in order to identify and analyse ethos in the analysis in chapter 6. In the next section the Ethos model will be explained more thoroughly.

111 112

Lund & Petersen (2001), p. 130 f. + de to andre artikler Isaksson & Jrgensen (2008) 113 Isaksson & Jrgensen (2009)

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3.2.1 The Ethos Model The Ethos model by Isaksson and Jrgensen114 adopt McCroskeys representation of credibility, consisting nsisting of the three dimensions of ethos expertise, e, trustworthiness and empathy and assign three rhetorical strategies to each of the dimensions at, what they c call all the conceptual level. These strategies have been named self-promotion, promotion, self self-characterization and self-sacrifice. sacrifice. These strategies further demonstrate how the three dimensions can be used strategicall strategically. Then eleven credibility appeals have been identifi identified: five for self-promotion promotion expressing expertise, four for self-characterization expressing trustworthiness and two credibility appeals of self-sacrifice self expressing empathy.

Expertise

Trustworthiness

Empathy

Self-promotion

Self-charaterization

Self-sacrifice

Presence/Resources

Truthfulness

Enjoyment

Abilities/Attributes

Integrity

Attentio

Knowledge/Skills

Courage

Entitlements/ Enhancements

Passio

World knowledge

Figure 12 The Ethos model

114

Ibid

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The eleven credibility appeals constitute the operational level of the model. Below, Isaksson and Jrgensens coding framework is given. This framework allows the identification of credibility appeals in chapter 5 and permits to recognise these appeals consistently and precisely. (1) Expertise: Entitlements / Enhancements. Entitlements are used to communicate what the corporation has achieved, while Enhancements are used to bring attention to and take credit for a particular achievement, which the corporation believes they should be especially rewarded for. (2) Expertise: World knowledge. By communicating World knowledge, the corporation can portray its insight and knowledge. It is especially used to demonstrate universal truths or generalities about business life/conditions, the industry or company or the world at large. (3) Expertise: Presence/Resources. By demonstrating Presence and Resources, the corporation explains where it is situated and its ability to perform. This will typically be statements about the physical presence of the corporation, and its capabilities or way of performing, in concrete terms, or any description, recommendation, offering, or praising of products, services, or specialization offered by the corporation. (4) Expertise: Knowledge/Skills. By communicating Knowledge and Skills, the corporation states what they are made up of. These statements could contain information on knowledge and skills acquired by the members of the corporation through education or training, rank, merit, recognition, position or status, or cooperation with a third party or membership of an organization. (5) Expertise: Abilities/Attributes. Abilities and Attributes refer to the corporations fundamental competences. This will be expressed through statements about abilities or attributes that relate to the corporations natural qualities, work-related experience and insights, vision or human effectiveness, thoroughness or trust. (6) Character: Integrity/Justice. Integrity and Justice stand for how the corporation behaves. Integrity refers to statements about the corporations business morality or objectivity, neutrality, impartiality, or its members diligence. Justice refers to statements about the corporations equity, fairness and compliance with the law. (7) Character: Truthfulness. Through Truthfulness the corporation expresses its corporate identity with respect to morale, honesty and sincerity.

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(8) Character: Passion. Passion is how the corporation expresses its enthusiasm and excitement and state what they find rewarding. (9) Character: Courage. Courage is how the corporation communicates its responds to challenges and threats and refers to statements about the corporations competitiveness, its ability to demonstrate resolution and persistence. (10) Goodwill: Attention. Attention refers to statements concerned with the corporations selfless behaviour and concern for society and common good, or its devotion and attention to the target audience, or an indication of a bond between the corporation and its audience. (11) Goodwill: Enjoyment. Statements relating to Enjoyment are concerned with the corporations communication of their ability to generate happiness and joy, pleasure and satisfaction with others.

3.3 Summary of credibility


In this chapter, the notion of credibility and ethos has been presented and relevant theory has been discussed. It was established that this thesis will follow the approach that a source can use ethos as a tool to present itself as credible. Lund and Petersens model of credibility was discussed in relation to Isaksson and Jrgensens the Ethos model. It was decided that the Ethos model is the appropriate choice for the analysis of ethos in chapter 5, as it is operational and permits to identify the ethos appeals based on rather fixed boundaries. However, this thesis will call the ethos appeals for expertise, character and goodwill, based on Aristotles original appeals, yet with the modification of calling Aristotles intelligence appeal for expertise.

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4. Analysis of CSR discourse


In the previous chapters, the theory which serves as background for this thesis has been outlined. Chapter 2 presented the notion of CSR and CSR communication, as well as accounted for CSR issues in the food industry and the relation between CSR and culture. In this chapter an analysis of the CSR discourse of the two case study companies, Arla and Smithfield, will be carried out. The framework created in section 2.3.2 will be used in order to find out what and how the two companies communicate CSR. The analysis will include which issues they address, which processes they communicate in order to realise the CSR discourse and who the company identifies as stakeholders for the issue communicated.

4.1 Presentation of empirical material


On Arla Foods website, the Our responsibility section will be analysed. All issues addressed in this section and which can be related to the industry specific CSR issues (see section 2.5.1) will be addressed. On Smithfield Foods website, the section Responsibility will be regarded in this analysis. CSR or issues closely related to CSR, such as Corporate Governance, are also communicated by the company in other sections such as Employees and Investors. However, these will not be regarded, as the thesis strives for a comparative discussion of the two companies and therefore it is necessary that the two sections analysed are directly comparable. That would not be necessary if results from sections such as Corporate Governance would be included from one company but not from the other. 4.1.1 Background for CSR profile: Arla Foods In this section, Arla will be shortly presented. Furthermore, two of the companys problem areas will be accounted for, as these issues might be reflected in the companys CSR communication. For example could Arla decide to communicate more extensively on an issue in order to improve its image in a problem area. This might then have an influence on the analysis of Arla and the comparison of the two companies.

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Arla Foods is a Swedish-Danish cooperative and the largest producer of dairy products in Scandinavia. Arla has production facilities in 12 countries and sales offices in another 20 countries. The companys dairy products are exported around the globe and core markets include Denmark, Sweden, the UK, Finland, Germany and the Middle East115. Monopoly Arla Foods has often been criticized for its monopoly-like status in Denmark. Especially in 2004, the criticism that Arla continued to buy out smaller diaries and thereby was able to raise the price for dairy products, especially ecology products, reached its high point116. Also farmers expressed for dissatisfaction with Arla, and many left the company in favour of supplying smaller diaries while getting a higher price for milk117. Arla also had to defend itself in court several times for accusations of anti-competitiveness. In 2006 Arla was charged a fine of 5 million DKK for bribery, because the company agreed to pay supplements for a supermarket anniversary campaign on the condition that the supermarket stopped its collaboration with Arlas competitors Hirtshals Andelsmejeri118. Even though many smaller diaries have gained market share today, Arla still has the largest market share in Denmark119. Some Danish consumers and competitors therefore remain sceptical of the company and many still express their dissatisfaction through boycotts of Arla products120. As this problem area might have caused scepticism from consumers and the media, Arla might want to address this issue in their CSR in order to account for their responsibilities in this regard. The Mohammed crisis Satirical cartoons of Mohammed published by the Danish paper Jyllandsposten resulted in 2006 in a boycott of Danish products in the Middle East. As the Middle East is Arlas largest market outside of Europe, Arla's sales were seriously affected by the boycott and the boycott cost them about 400 million DKK (about 68.8 million USD) in 2006121. In March 2006, Arla announced that it used heavy advertisement in Arabian countries, where the company distanced themselves from the cartoons and stated that after 40 years in the Middle East, Arla Foods is well aware that justice and
115 116

http://www.arla.com/group/organisation/about-the-company/the-co-operative/ http://www.business.dk/article/20040509/nyhedsoversigt/105090364/ 117 http://www.dr.dk/Regioner/Nord/Nyheder/Nordjylland/2007/08/10/082208.htm?rss=true and http://dr.dk/Regioner/Fyn/Nyheder/Fynogoer/2008/01/03/184209.htm?wbc_purpose=updabr 118 http://www.ks.dk/service-menu/publikationer/publikationsarkiv/publikationer-2008/00/4-hvad-risikerervirksomheder-som-overtraeder-konkurrenceloven/ 119 http://www.business.dk/article/20040403/nyhedsoversigt/104030372/ 120 Own experience and http://avisen.dk/maelken-afsloerer-din-politiske-holdning_78004.aspx and http://www.lr.dk/kvaeg/diverse/t6madsps.pdf 121 http://www.arla.com/group/organisation/about-the-company

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tolerance are basic Islamic values.122 Arla also stated that New Arla initiatives include sponsoring humanitarian projects in the region, i.e. by giving aid to disabled children, cancer sufferers and the hungry. Arla has approached the Danish Red Cross to assist in co-ordinating the effort. Arla also intends to support activities aimed at creating greater understanding between the worlds religions and cultures.123 As the issue includes philanthropic actions, such as support to humanitarian projects, it is likely to be emphasised in the companys CSR communication. 4.1.2 Background for CSR profile: Smithfield Foods Smithfield Foods, Inc. is the worlds largest pork producer and processor124. Its headquarters are in Smithfield, Virginia, with operations in 26 states and 9 countries. Environment In 1997, Smithfield was fined 12.6 million USD for violation of the federal Clean Water Act, due to millions of gallons of faecal matter and other pollutants that were released into the rivers of North Carolina over a five year period125. The pollution was said to have a serious impact on the environment and the local community. Smithfield was charged the largest Clean Water Act fine ever at that time126. Consequently, Smithfield Foods has adopted more environmental friendly initiatives and has among other things entered into an agreement with the Waterkeeper Alliance127 and taken steps to environmental certification of its slaughterhouses128. Therefore it is likely that the company communicates on their initiatives and certifications in order to improve their image in terms of the environment. Labour issues In 2005, the National Labor Relations Board (NLRB) announced its decision finding Smithfield Packing Company guilty of illegally assaulting, intimidating and harassing its workers in Tar Heel, NC, when the company attempted to form a union in 1994 and 1997. The company has since paid back $1.1 million in wages, plus interests, to 10 workers that were fired during past union-

122 123

http://www.arla.com/press/archive/arla-attempts-a-comeback-in-the-middle-east/ http://www.arla.com/press/archive/breakthrough-for-arla-in-the-middle-east/ 124 http://findarticles.com/p/articles/mi_m0EUY/is_31_12/ai_n26959360/ 125 http://www.usdoj.gov/opa/pr/1997/August97/331enr.htm 126 Ibid 127 http://www.waterkeeper.org/mainarticledetails.aspx?articleid=216 128 http://www.smithfieldfoods.com/responsibility/el.aspx

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organizing elections129. This issue might also be communicated in Smithfields CSR in order to attract employees and improve the companys reputation as a good corporate citizen.

4.2 Analysis of Arlas CSR discourse


Economic achievement We manage our business in a good cooperative spirit that promotes the financial interests of our owners summarizes that Arla thinks of its economic responsibility as a responsibility towards its owners. Since Arla is a producer cooperative and the owners of the company are the farmers, it is not surprising that Arla has to account for how the company is operated and how the company cooperates with and satisfies the interest of their owners. This may be the reason why Arla has dedicated a section of the CSR to how the business is managed. In this section the company accounts for the relationship with their owners in terms of resources, governance, the cooperative conditions and the insight the owners can have in the companys business operations. As this information could very well have had its own section on the website, instead of being part of the CSR report, Arla must have thought about the satisfaction of their owners as part of their responsibility instead of simply being part of their business strategy. One could also tend to believe that, since Arla has had issues with its owners in the past (see section 5.1.1), the company therefore communicates their responsibilities towards their owners in order to re-establish the companys good reputation and reduce the risk of scepticism by the public as well as by present and future owners of the company. Compliance with law In the section business principles, Arla poses the interesting question What does responsible enterprise mean?As an answer to this question the company states that In all of the countries in which we conduct our operations, and at all organisational levels, we obey the law. Arla therefore communicates that obeying the law means to be a responsible company. The company furthermore states that This enables us to act credibly and with integrity with all our stakeholders, where the company expresses that by obeying the law the company also manages to be responsible towards their stakeholders. Arla does not only account for their compliance with the law and the transparency of the company, but also state their approach to bribes. Especially the statement we never offer or provide any gift or payment that constitutes, or could be interpreted as, a bribe is interesting, as Arla has been charged with bribery not too long ago (see section 5.1.1).
129

http://www.ibtimes.com/articles/20081219/nlrb-holds-off-on-certifying-smithfield-union-vote.htm

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Employees Arla has two sections which focus on the issue of employees, the workplace and human rights. In the section workplace, Arla seems to communicate two topics. The first topic deals with the companys responsibilities as an employer, such as to provide employees with a safe and healthy workplace, to ensure the well-being of their employees, to counteract harassment and to respect diversity. The second topic deals with statements connected to work achievements and performance, which could represent what the employees can do for Arla. Some examples are that the workplace judges work achievements regardless of ethnic background, gender, age, religion, civil status or sexual orientation and that the company states to invest in their personal and occupational development in order to support our business strategy. Arla therefore seems to focus on both their responsibilities towards employees, but also highlight performance and achievements. Arla also communicates human rights, where the company asks the question can we accept responsibility for peoples living conditions? This may be one of the overall issues of CSR whether or not corporations should take on responsibility in relation to how their workers live. Arla does not directly answer its own question, but rather states that Arla conducts business as a responsible citizen through respecting and upholding internationally recognized human rights. However, it is reasonable to say that peoples living conditions contain much more aspects than human rights, such as housing, access to food and clean drinking water, education and so on. This is however, not emphasised by Arla. Healthy lifestyle In this section, Arla poses the question Should we decide what people should eat? Instead of answering the question explicitly, Arlas approach is to help consumers in their nutritional decision making process by giving information about the product: The aim is that our products and the information we provide will inspire and stimulate consumers to increase their interest in the link between nutrition and health. The company expresses their motivation for doing so as we meet consumer demands for healthy products and nutritional information about products. Even though Arla communicates about this issue as though the company voluntarily informs about their products due to consumer demand, there has been established legislation on food labelling by the EU Commission130.

130

http://www.ugebrevet-europa.dk/artikel.asp?AjrDcmntId=439

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Animal welfare In the section on sustainable agriculture, Arla shortly mentions their responsibilities towards animal welfare. We encourage and support milk suppliers in their efforts to adopt the latest farming practices, particularly with respect to animal welfare, in order to continuously improve the quality of life and physical environment of animals. Despite the fact that the company only communicates briefly about animal welfare, Arla states that animal welfare is a particularly important part of their farming practices, and that communication with suppliers on these issues is through encouragement and support not via corporate policies and code of conducts. Arla does not elaborate on how these practices are created or which actions will be taken if suppliers misbehave in terms of animal welfare. Food safety We meet consumer demands for safe dairy products is Arlas approach to food safety. Again, consumer demands seem to be at the centre of this CSR issue, which is understandable, since consumers would not buy products which are not safe to drink or eat. Arla also emphasises care for their consumers by stating Consumers must have confidence in our products... and We prevent and protect our consumers from being injured... Moreover, Arla gives many examples of processes and initiatives the company has taken in order to ensure safe products. Just some of the examples are the HACCP system (Hazard Analysis and Critical Point control), hygiene routines and traceability programs. Although the descriptions of these initiatives are rather short and not very much information is given, the goal of this section seems to be to demonstrate that Arla takes different approaches in order to eliminate safety risks and quality issues and in order to be able to take action in case of failure. Environment The environment and climate section seeks to account for Arlas approach to minimizing their impact on the environment and climate, which Arla states is at the heart of everything we do. Hereby Arla signals that environmental efforts are central to their business and the company also emphasises that their efforts are an ongoing process at every level we consider whether we can change any aspect of our work methods in order to reduce our environmental impact. However, Arla also states that it is unavoidable that production at our farms and dairies, and our transportation, affect the environment. This statement could indicate that the company thinks realistically in communicating that the reader must expect that Arlas business operations will always, in some way, affect the environment However, one could also argue that Arla is trying to

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avoid talking about the subject. It seems as if Arla is communicating rather vaguely upon their intentions. Arla then accounts for the steps the company takes in order to always improve their protection of the environment, which includes sound and sustainable principles from cow to consumer. Examples of these principles are designing new facilities, procuring equipment, saving energy and reducing material consumption, waste and CO2 emissions. Besides their own initiatives, Arla states that we challenge and encourage our suppliers to develop and deliver products and services that exceed our environmental standards and that the company is open towards the wishes expressed by their stakeholders and regulatory authorities. Also in the section of Agriculture, Arla expresses its views on making agriculture more sustainable through support to sustainable farming and encouraging milk suppliers to protect the environment. Still, Arla does not state how the support and encouragement is shaped and whether the company will act on misbehaving suppliers. Community This section is introduced by the question Can Arla Foods improve the world? One might think that this question is used to introduce Arlas philanthropic actions. Arla also emphasises this fact by stating We cannot change the world on our own, but we believe we can make a difference within the local communities However, Arla focuses on maintaining good relationships with their communities we maintain good, respectful and constructive community relations. Arla does not further elaborate on how the company contribute positively to their development. Arla did neither provide information on foundations or volunteerism in their CSR report. 4.2.1 Preliminary conclusion on Arlas CSR discourse There are several tendencies to point out. Firstly, since Arlas CSR communication is arranged in bullet-points, the critical reader may sometimes feel that the communication lacks argumentation, i.e. in the issue of community or animal welfare, as much information may seem to be presented as facts. Secondly, as mentioned earlier, Arla has had some issues in the past which might be brought up in CSR communication, such as bribery, unfair competition and religion. Arla distances itself from bribery and unfair competition in their CSR and by doing so, Arla might be using its CSR communication to improve their reputation and communicate that the corporation has changed. 42

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Surprisingly, Arla did not report on the Mohammed crisis at all. One could have expected a section where Arla reports on the respect of religions and that the company would never participate in any actions that involve violation of their respect. It can also be observed that Arla states that the company helps consumers to make the right choice in terms of healthy lifestyle by informing consumers about the ingredients in their products. Here Arla expresses that the company fulfils the demand of their consumers for healthy products and nutritional information while also communicating concern and good will towards their consumers. On the other hand, legislation on labelling of products already provides fixed boundaries on how food producers should label their products. Arla does not emphasise that fact and it therefore seems as though the company wants to communicate that the company informs consumers voluntarily. Moreover, it can be observed that Arla encourages readers and stakeholders to contact the company with their views and suggestions in relation to CSR. This further supports their statements of stakeholders as drivers of CSR.

4.3 Analysis of Smithfields CSR discourse


Smithfield has several sections on their website that deal with CSR or a related topic, such as Corporate Governance. However, the section dealt with here is their Responsibility section accessible from their front page. Each subsection of Smithfields CSR section begins with an introduction to the subject. Then different issues are elaborated in a coherent text. Economic achievement Smithfield only states economic responsibilities in one case: Our global perspective and commitment to inclusion are central to our mission to produce good food, responsibly, and ultimately maximize shareholder value. This statement shows that Smithfield does feel responsible towards their shareholders. Yet the company does not communicate further on this issue. Compliance with law Even though Smithfield does not have a section on lawfulness per se under Responsibility, several statements of Smithfields intent to comply with the law are given. In most cases, however, Smithfield communicates compliance with and exceeding the law and regulations, such as in the environment section where Smithfield seeks to demonstrate its responsible corporate citizenship by complying with relevant environmental legislation and regulations, and with other requirements to which we voluntarily subscribe and Maintaining compliance with all federal, state, and local regulatory requirements. It is also communicated widely that complying with company policies 43

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and the Code of Conduct are essential for the company: The company will take appropriate disciplinary actions for violation of policy or law and Adherence to the principles of this policy is a responsibility and requirement. It may therefore be concluded that Smithfields approach to compliance with the law apply to the federal, state, and local laws in the US as well as selfregulatory company policies. Employees Smithfield argues that, since the company feel responsible for its consumers, it is only natural that the company also feels responsible for their employees and their families. The company therefore communicates that employee health and safety is a core value of our business and that it takes an active role in supporting their employees. Here Smithfield gives the example of a production site which has its own healthcare facility for their employees and families. Additionally, the facility is also open to the local community, due to general lack of affordable healthcare options in the area. Here, Smithfield expresses care for the health and safety of their employees, their families and the local community by providing them with affordable healthcare. Moreover, Smithfield describes their human rights policy and health and safety policy. Under human rights policy, Smithfield not only expresses respect and protection of human rights, the company also accounts for equal opportunities Smithfield does not discriminate against any employee or applicant for employment because of race, color, religion, ethnic or national origin, gender, sexual preference, age, disability, or veteran status. Smithfield does therefore not only apply its non-discrimination policy to current employees, but in the whole process from applicants, over hiring and training to terms and conditions of employment. Smithfield also accounts for the disciplinary actions if discrimination or harassment and violence should occur. Smithfield also expresses that their employees are free to join or not to join unions and other organisations and that harassment and violence are not tolerated at Smithfield. As mentioned earlier, the company has been charged with harassment of workers due to union-organizing elections. The company therefore seems to dissociate itself from this problem area by communicating to not tolerate this behaviour. Furthermore, Smithfield has also implemented a corporate policy on this matter and includes the issue in the companys code of conduct any type of harassment per company policy and the law and as outlined in the Smithfield Code of Conduct. Whereas most of the employee section qis targeted at employees, the company also mentions their responsibility towards community stakeholders in the issue of health and safety Smithfield is 44

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committed to ensuring the health, safety, and well being of our employees, the people living and working in communities near our facilities, and the environment. Smithfield therefore not only relates health and safety to their employees, but also to the community and the environment. Moreover, Smithfield describes their approach to health and safety as making their own standards and own regulations since although occupational health and safety is highly regulated in the United States, more so than almost any other country in the world, 100 percent compliance 100 percent of the time with regulatory statues is not enough to keep people safe. Smithfield therefore argues for self-regulation and going beyond regulations. This also applies to more areas in the field of health and safety, where Smithfield argues Although here in the United States we have many laws and various Occupational Safety and Health Administration agencies, we generally lack an overall management system. Here, Smithfield criticizes part of the national system and reports how this problem is solved within the company through self-regulation. This system is then described in much detail, although it is merely a Health & Safety Summary. Animal welfare Smithfield reports that the company is recognized by the worlds foremost experts in animal wellbeing as setting the standard for Americas pork industry. To underline this statement, Smithfield elaborates on five different issues in terms of animal welfare: their Animal Welfare Management System, their innovative approach to gestation stalls, their overall Animal Welfare Policy, their Antibiotic Policy and their Accident Response program. Smithfield therefore communicates extensively on animal welfare, from pregnant sows to sick animals to accidents involving animals during transport. The company communicates their motivation as to assure respectful and humane treatment of animals that we own or process, to produce wholesome food products for our customers This claim is further supported by expert recognitions and testimonials, as almost every one of the before mentioned issues is supported by a citation of a 3rd party expert in the field or even supplemented by a newspaper article. Moreover, two experts in the field of Animal Science and Animal Agriculture are cited in the Recognition section. However, as Smithfield states to produce wholesome food products for our customers, their motivation to engage in animal welfare is also based on their responsibility towards their customers.

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Food safety Smithfields motivation for engaging in food safety seems to be consumer satisfaction to ensure our ability to provide safe, wholesome foods for families throughout the world, we use a multitude of food safety processes and programs throughout our plants. Smithfield describes a series of testing and HACCP programs and introduces their facility and food safety guidelines. The company also reports that their employees are central in these programs and that they receive proper training in this field, All of us at Smithfield Foods never forget that we are working hard to produce the safest foods possible. Thereby Smithfield expresses the commitment and involvement of the whole company, in order to ensure that consumers are provided with safe food. Environment Smithfield states providing good food responsibly means going above and beyond to be good stewards of the environment. The company therefore communicates that it is not only necessary to behave correctly but also to make an effort and a positive contribution to the environment. As proof of their commitment, the company states that their commitment is reflected in our ISO 14001 certification. Smithfield also gives examples of their achievements and actions. In this way the company establishes an overview of their CSR activities and proves that it is a responsible company. The Environmental Management System section describes how the company reduces its use of natural resources and finding ways to improve whereas World Water Monitoring Day and National FFA Environmental Award focus more on philanthropic aspects, such as sponsoring and volunteerism. World Water Monitoring Day will therefore be dealt with later, under the aspect of Volunteerism. In terms of the National FFA Environmental Award Smithfield includes a testimonial from a scholarship recipient in the FFA competition, where he states that the money will go to his education in the field of Natural Resources. This statement further supports Smithfields motivation to support agricultural education in order to provide students with the opportunity to learn. Smithfields environmental responsibilities therefore not only involve the protection and preservation of natural resources, but also include philanthropic activities such as sponsorships and volunteerism. Moreover, Smithfield includes Recognition in their communication of their environmental responsibility as proof of their commitment to protecting and preserving the environment and the company directly states You dont just have to take our word for it. Each award or honor provides tangible proof.

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Community Smithfield states that its our responsibility to give back to the communities where our employees live, work and raise their families. Smithfield therefore seems to include employees and their families in its responsibilities towards the local community. The company furthermore reports that one of their core involvements are educational initiatives which provide learning opportunities for those that might not otherwise have them and providing support to food programs that help feed the hungry. Smithfield therefore communicates philanthropic actions in their community section, as those are activities which the company engages in voluntarily in order to ensure the continued well-being of our employees and communities. Furthermore, Smithfield emphasises feeding the hungry in their Helping Hungry Homes initiative which supports families faced with food insecurity. In order to do so, Smithfield has four courses of action: Food Banks, School Nutrition Programs, Disaster Relief and Community Outreach. The company also arranged for a 10-City Helping Hungry Homes across America Tour, where a popular kitchen chef helped providing food to families. Again, Smithfield describes exact initiatives and activities to prove their role as a responsible and good citizen. Foundation The Smithfield-Luter foundation is the philanthropic arm of Smithfield Foods and provides educational scholarships to children and grandchildren of Smithfields employees. Furthermore it also funds the Learners to Learners education alliance to overcome challenges such as Academic disadvantages, social challenges, cultural barriers etc. Volunteerism Smithfield states that its employees actively engage in World Water Monitoring Day in order to help preserve resources. By stating that Around the world, our employees have tested waterways together with school children, 4-H groups, Boy Scouts, Girl Scouts and church groups Smithfield relates its employees to committed volunteers with a good reputation. This way the commitment and engagement of Smithfield volunteers may be enhanced. As discussed earlier, Smithfield has been fined with a penalty for violation of the Clean Water Act 12 years ago. It seems reasonable to say that Smithfield engages in this activity in order to dissociate itself from the past and to support and engage in this initiative to ensure clean water to signal that Smithfield is a responsible company. Smithfield does not communicate on healthy lifestyle.

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4.3.1 Preliminary Conclusion on Smithfields CSR discourse Smithfields CSR section is dominated by three tendencies, the companys tendency to self-regulate through company policies and regulations, its constant desire to prove that the company is responsible and a good citizen through recognitions and testimonials, and its emphasis on families. The first tendency, their tendency to self regulate is especially visible in the situation where the company states that in the US occupational health and safety are highly regulated, but state that it is still necessary to self-regulate with a corporate system for health and safety, as the federal, state and local policies are not sufficient. Also in other examples, Smithfield communicates corporate actions which provide necessary services to e.g. employees and the local community. Some of these examples are: a healthcare facility for employees and the local community at one of their sites, as the area lacks affordable healthcare. The company supports education in order to give students an opportunity they might not otherwise have. The company also provides food for families with food insecurity. Smithfield therefore seems to take great responsibility towards their employees and the local community and the company seems to believe that their employees and the local community in some cases are highly dependent on Smithfields services, as the company states that without their services and support, students may not get the opportunity to succeed and the hungry might not otherwise get food. The tendency to constantly prove that the company is a responsible and good citizen can be seen with almost every issue, where Smithfield gives examples of what the company has achieved in terms of improvements, recognitions and awards, detailed descriptions of policies, expert and media endorsers/statements, i.e. animal welfare, and thankful testimonials by scholarship receivers. In some cases, the President and CEO and Vice President have signed at the bottom of the page, e.g. animal welfare, human rights etc. One could claim that this is meant to give the impression of being an official document or prove that these policies are so important to the company that the management itself has signed and approved this document. Family seems to be a central value in the company, as their motivations and goals often include the family values. In some cases, Smithfield seems to emphasise that the company is part of the local community: It is our responsibility to give back to the communities where our employees live, work and raise their families. In other cases the company seems to connect family values to

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their products: To ensure our ability to provide safe, wholesome foods for families throughout the world and we do this so that both our families and families throughout the world who eat our products can do so safely. In the latter example, Smithfield even includes their own families, which may appeal to the readers emotions and persuade him that Smithfield ensures that their food is safe not just for other families, but their own as well. In addition to these tendencies, other interesting elements can be pointed out. Smithfield also uses personal appeals, in order to connect personally with the reader. Smithfield describes that health and safety is not just a priority for Smithfield as we all know what happens to priorities. By stating we all know, Smithfield connects to the readers knowledge or personal experience with priorities. Another example relates to Smithfields tendency to prove that they are responsible. One example is that Smithfield states you dont just have to take our word for it. Each award or honor provides tangible proof. Here Smithfield addresses the reader directly and persuades him by logical arguments if Smithfield has won awards and gained honours it must be right. Smithfield also seems to engage in activities which may benefit their reputation in terms of environment and working conditions. As mentioned earlier, Smithfield has been charged with pollution and harassment in the past and seems therefore to take these issues especially seriously. One can conclude that Smithfield uses their CSR communication in order to prove to stakeholders that the company is a responsible citizen and not only has improved, but also engages voluntarily in these fields.

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5. Analysis of ethos
In the previous chapter, the analysis of Arla and Smithfields CSR discourse has been carried out. This leads to this chapter, which will identify which credibility appeals the companies use in order to present themselves as credible CSR companies. In chapter 3, the notion of ethos (credibility) has been accounted for. Here the model used for identifying the ethos dimensions expertise, character and goodwill and their appeals has been presented.

5.1 Arla
5.1.1 Expertise Arla communicates expertise continuously throughout its CSR communication, except on the issue of lawfulness, which focuses on the dimension character (see 6.1.2). Out of 112 identified appeals in 102 sentences, 34 appeals belong to the dimension of expertise131. Expertise is the most dominant appeal in the CSR issue of food safety, where 15 out of 24 ethos appeals are within the dimension of expertise.

Ethos dimension Expertise

Credibility appeal

Examples

Entitlements / Enhancements

We have set meticulous standards for food safety throughout the food chain, which means that we engage everyone, from our milk suppliers to consumers, in our food safety commitments. - Entitlements what the corporation has achieved.

During 2007 imposed a comprehensive work on food safety that Arla Foods' dairy in Sweden and Denmark meet the new ISO 22000 standard. - Entitlements what the corporation has achieved We got our results certified 27 dairies out of 61 were ISO-certified in 2007, and another 20 are in the course of 2008.
131

See appendix4 for analysis numbers.

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- Entitlements what the corporation has achieved World Knowledge Consumers must have confidence in our products. - Universal truth

Presence / Resources

We maintain control over hazards in the manufacturing process by using a well functioning HACCP system and by empowering skilled employees. - Capabilities or way of performing in concrete terms

We offer safe products by using hygienic processes and facilities, and by following clear routines for personal hygiene. - Capabilities or way of performing in concrete terms We keep our premises free from pests by means of a proactive programme. - Capabilities or way of performing in concrete terms We have systems for tracing raw materials, ingredients and end products. - Capabilities or way of performing in concrete terms We have production facilities in many countries and our products are sold throughout the world. - Presence We maintain up-to-date knowledge of allergies and have robust purchasing and production procedures that prevent contamination. (and knowledge/skills) - Capabilities or way of performing in concrete terms

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None of the farms delivered to Arla, but a comprehensive security program was launched to prevent proliferation. - Capabilities or way of performing in concrete terms

Knowledge / Skills

We keep ourselves abreast of food safety developments and ensure that we have the information and knowledge required to take preventive action. - Knowledge acquired by the members of the corporation We maintain up-to-date knowledge of allergies and have robust purchasing and production procedures that prevent contamination. (and presence/resources) - Knowledge acquired by the members of the corporation In January 2008, Arla Foods joined the UN Global Compact, the worlds largest global corporate citizenship initiative. - Knowledge membership of an organisation

Abilities / Attributes

Three of these 15 expertise qualities are in the field of entitlements, where Arla states what the company has achieved in terms of food safety, such as We have set meticulous standards for food safety throughout the food chain... These entitlements may be used in order to persuade the target audience that Arla is committed to food safety and actually produces clear results. In this example, Arla claims to have set standards in order to assure food safety across the food chain. Arla expresses that the company has achieved to get some of their dairies certified in 2007 27 dairies out of 61 were ISO-certified in 2007, and another 20 are in the course of 2008. This statement has been categorised as an entitlement. However, it could also be placed within the appeal of knowledge/skills, since Arla could refer to an acquired recognition, position or status. However, since the certification is communicated as an achievement in the specific timeframe of 2007 the statement is categorised as an appeal of entitlement. The presence/resources appeal constitutes most of Arlas expertise qualities in the issue of food safety (7 out of 15) and might convince the target audience that Arla has the necessary resources and capabilities to provide safe foods. The appeal We maintain control over hazards in the 52

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manufacturing process by using a well functioning HACCP system and by empowering skilled employees could also express knowledge/skills, since the company expresses knowledge or skills acquired by the members of the corporation. However, in this case, Arla uses the HACCP system and empowered skills in order to describe how the company performs and ensures control over the process in concrete terms. Therefore this appeal has been placed in presence/resources. The statement can serve as an example for the presence/resource appeals in the food safety issue, as they are mainly constructed in the same way, e.g. We keep our premises free from pests by means of a proactive programme. Also here, and in most of the other appeals, Arla describes their way of performing or ensuring food safety through the means of programs and systems. In 3 out of 15 appeals Arla communicates knowledge/skills in food safety. Whereas the company in the presence/resources appeal focuses on performance and actions, Arla here signals that the company has the necessary knowledge to provide safe foods by focusing on further education and being up to date We keep ourselves abreast of food safety developments and ensure that we have the information and knowledge required to take preventive action and We maintain up-to-date knowledge of allergies and have robust purchasing and production procedures that prevent contamination. With these appeals Arla signals that knowledge of food safety is a constant process which the company tries to keep up with. In addition, knowledge/skills also include Arlas membership of the UN Global Compact, In January 2008, Arla Foods joined the UN Global Compact, the worlds largest global corporate citizenship initiative which demonstrates that Arla is serious about its commitment to CSR and enhances the competence of the company by referring to highly recognised bodies. As opposed to food safety, Arla reports only briefly of animal welfare, and in what is reported, communication of the expertise dimension is surprisingly low (2 out of 6). One might expect that Arla would focus on its expertise as a cooperative dairy firm with expert owners in the field of animal welfare. However, Arla only uses the appeal of presence/resources in relation to their expertise in animal welfare. In the statements, the company describes targets Working jointly with our Danish and Swedish owners, we have established ambitious targets for agricultural methods, animal health and feed quality and programs The Arlagrden Quality Assurance Programme implemented in Denmark and Sweden and various other local initiatives ensure that we satisfy all applicable requirements for milk quality, environmental efforts at farm level and animal welfare. In the statements the company states to satisfy requirements and to establish own targets. However, the company is rather vague about what its targets and the program consist of.

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5.1.2 Character Arla communicates character in every single one of their CSR issues and often it is the prominent appeal in the section. Throughout the entire CSR section, character counts for almost half of the appeals, 53 out of 112 and thereby constitutes Arlas main appeal. Lawfulness In terms of lawfulness, Arla states character solely through integrity/justice in 10 out of 10 appeals, as their main concerns in this issue deal with compliance with the law and business morality. In terms of complying with the law, Arla states In all of the countries in which we conduct our operations, and at all organisational levels, we obey the law. Business morality is expressed by We will immediately reject and report to the management all demands, or offers of bribes. These appeals stand for how the corporation behaves and may form a picture of the corporation as a moral and trustworthy character. These two sentences may serve as examples of all 10 appeals, since they all express that Arla will comply with the law on a number of issues (justice) and that the company will take action on any breaches (business morality). They state their motivation to do so as This enables us to act credibly and with integrity with all our stakeholders. In terms of employees, Arla focuses mostly on the dimension of character (14 of 20 appeals). Integrity/justice is again the dominating appeal, where business morality and justice are emphasised: We create a workplace that reflects society and its diversity, treats all employees equally and judges work achievements regardless of ethnic background, gender, age, religion, civil status or sexual orientation. Arla further communicates that the company creates decent workplaces, respects their employees and treats them fairly and in accordance with human rights. Also lawfulness and respect for industry standards are emphasised by Arla We ensure that wages, salaries and other types of remuneration meet or exceed the levels stipulated in legislation or industry standards in the countries in which we are active. Arlas communication of character in terms of employees includes therefore to a large extend statements about the workplace and working conditions. Furthermore, Arla expresses to meet the legislation and standards concerning in this area. This part of the CSR report seems to be targeted at their employees in countries outside of Scandinavia and the UK, as the circumstances described, e.g. forced labour and child labour would not be likely to occur in these countries. However, statements about harassment and diversity along with recognition and rewards of exceptional achievements are likely to occur in all countries and

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therefore seem to be targeted at employees in their three main labour markets as well, the UK, Sweden and Denmark132. Moreover, Arla also communicates truthfulness through a collective moral constitution within the company. Here Arla claims that Arla Foods133 employees have a common way of working that is rooted in our values, regardless of where they work within the Arla Foods group. In this statement, Arla claims that its corporate identity incorporates the same values and the same level of trustworthiness all over the world. One might be surprised to see that Arla communicates the dimension of character 11 times, but not communicates goodwill at all. It is surprising, as care for the environment can be said to be a generally altruistic issue itself. Instead, Arla mainly focuses on communicating business morality. Arla states that Constantly seeking to minimise the environmental impact of our operations is at the heart of everything we do. Even though the company states that one of their core responsibilities is limiting its impact on the environment, Arla does not elaborate on initiatives or activities that help them realise this responsibility. 5.1.3 Goodwill Arla communicates goodwill 28 times in their CSR section and it is mostly emphasised in the CSR issue of food and health (6 out of 13) and the issue of community (7 out of 13). In terms of food and health, Arla communicates both attention to the target audience and enjoyment. The company mainly communicates to help its consumers by informing them about the relationship between food and health We help consumers understand the role that dairy products play in a well-balanced diet,134 through comprehensive and honest product information and We support research in this area to learn and to educate others about a balanced diet. Both sentences have been analysed to have dual appeals. The statement We help consumers understand the role that dairy products play in a well-balanced diet, through comprehensive and honest product information incorporates goodwill through attention towards the consumer we help consumers and character through trustworthiness honest product information. Through the trustworthiness appeal, Arla presents itself as a truthful and honest company. The statement We support research in this area to learn and to educate others about a balanced diet includes goodwill
132 133

http://www.arlafoods.dk/koncern/organisation/andelsselskabet/om-andelsselskabet/ Arlas mistake 134 Arlas comma mistake

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through attention towards others to educate others and expertise, knowledge/skills, through learning and acquiring knowledge We support research in this area to learn. The dual appeals in these sentences could indicate that Arla expresses food and health not only in order to express how the company cares for others, but also to involve the company itself through self-promotion by expertise and self-characterisation through character. In terms of community, Arla expresses goodwill mainly through attention to the community. We regard ourselves as an active player in the communities in which we operate and We interact with local communities and contribute positively to their development are two examples on how Arla communicates altruistic behaviour towards the community in which the company states to be active in the community and contribute positively. The company also states how the company sees this responsibility towards their community by stating that: To contribute to the development of the local community, we establish long-term relationships with people, companies and organisations. Arla therefore seems to see their responsibility towards the community as establishing a bond between the corporation and the community and therefore communicate attention through this bond. 5.1.4 Conclusion on ethos analysis of Arla The most dominant dimension in Arlas CSR communication is the dimension of character, which is present in every section of the companys CSR communication. Arla uses this dimension mainly to express integrity/justice in order to characterise the company as having high morale and doing business ethically. Expertise is the second most communicated dimension, where Arla promotes itself through entitlements in form of their achievements, presence/resources through the way the company performs in concrete terms and the knowledge/skills of the company. Hereby the company express that their responsibilities, such as food safety, are fulfilled and controlled through the expertise of the company, which are realised through actions and achievements as well as through knowledge. The company therefore expresses that it is trustworthy because it has the necessary expertise to ensure control and safety. Arla does express goodwill to some extent. However, the company does not always communicate self-sacrifice. Especially in terms of food and health, Arla communicates attention and enjoyment through helping consumers make the right choice for a well-balanced diet and to educate them on how dairy products are related to health. Arla therefore does not entirely sacrifice themselves for the

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benefit of the consumer, since the company relates this benefit to themselves and their products, which can help the consumer to a healthier lifestyle. In terms of the community, Arla contributes positively to the community through establishing a positive relationship. However, the company does not explain what it means to have a positive relationship with the community. One can only speculate whether the company creates a positive relationship through providing jobs for the community or whether it supports the community otherwise. As this statement is so vague, it cannot be established whether the company actually engages in self-sacrifice. For example, if the company simply provides jobs for the community, the outcome from this relationship can be said to be beneficial for both parties.

5.2 Smithfield
5.2.1 Expertise Smithfield communicates expertise in all their CSR issues and this is also the most dominant dimension in their CSR section, used in 47 out of 111 appeals. In relation to the environment, the dimension of expertise accounts for 19 out of 35 appeals. Smithfield brings attention to the companys achievements through appeals of entitlements, such as Implemented over 150 individual projects in 2007 resulting in reduced water usage, air emissions and greenhouse gas emissions, improved energy efficiency and increased recycling and Created a Bioenergy Task Force to explore alternative energy options. Smithfields achievements are communicated very specifically by accounting for the specific activity and its purpose. This gives the reader insight into Smithfields engagement with the environment. In 8 appeals, Smithfield accounts for their knowledge/skills in environmental stewardship through acquired rank, merit, recognition, position or status. The company here accounts for recognitions and awards given by various institutions, such as The American Meat Institute The American Meat Institute has recognized 54 Smithfield Foods facilities in 23 states for significant environmental stewardship efforts in their local communities. These recognitions support Smithfields own claims of expertise and prove that the company really seems to be committed to the environment. Smithfield also accounts for their animal welfare by reporting knowledge/skills through its acquired rank and position. In fact, we're recognized by the world's foremost experts in animal well-being as setting the standard for America's pork industryand we're applying those same best practices to our global operations. However, in the issue of animal welfare, the company uses expert endorsers to support the companys expertise. Jennifer Woods, an Alberta, Canada-based 57

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livestock handling expert, analyzed our accident response plan through Murphy-Brown, our livestock production company, and praised it as "the standard for the industry in live-haul emergency response." This expert further supports Smithfields own statements of the companys expertise in the field of animal welfare. The company also accounts for cooperation with 3rd parties Experts from a variety of disciplines veterinary medicine, reproductive physiology, production management, marketing, management system administration, legal, logistics, and public affairsparticipated in an animal welfare committee to make sure animal well-being practices would be evaluated from many different perspectives. The cooperation with experts also contributes an understanding of Smithfield as experts in animal welfare. 5.2.2 Character Smithfield communicates the dimension of character 41 times during their CSR section, which makes it the second most communicated dimension, following expertise. In terms of employees (20 out of 35 appeals) and the environment (12 out of 35 appeals), Smithfield communicates the dimension of character mainly through the integrity/justice appeal. In both issues, the company accounts for its business morality and lawfulness. Towards their employees, the company accounts for health and safety, human rights, diversity, working conditions and counteraction of discrimination, harassment and violence. In terms of the environment, Smithfield mainly communicates complying with the law, rules and regulations as well as company standards in order to demonstrate that the company conducts business responsibly. Due to the extensive communication discrimination, harassment and violence, Smithfield seems to take these issues very seriously Discrimination against any employee or applicant for employment is a serious violation of equal employment opportunity law and of Smithfield's corporate policies. The company communicates to take strict action in these cases Employees who engage in violence or threats of violence will be subject to disciplinary action, up to and including termination of employment as well as criminal prosecution. This statement also shows that Smithfield is very concerned not only with the lawfulness of the firm, but also the lawfulness of the Smithfield employees, as the company here states employees who engage in violence. Furthermore, Smithfield communicates honesty and truthfulness by stating to provide tangible proof While we strongly believe that we have made, and will continue to make, great progress, you don't just have to take our word for it. It appears that Smithfield does not expect the reader to trust 58

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the corporations own statements and therefore the company must provide proof, as discussed before, through entitlements and knowledge/skills in the expertise dimension. 5.2.3 Goodwill Smithfield communicates goodwill in 23 out of 111 appeals all in all. Community (8 out of 14 appeals) and employees (6 out of 36 appeals) are the issues where goodwill is used the most. When communicating about their employees, Smithfield uses the goodwill dimension 6 times. Although this is not a very high number of appeals in relation to the 35 appeals all in all in the issue of employees, it still gives an image of the companys attention and care for their employees. When communicating goodwill towards their employees, Smithfield exclusively uses the attention appeal in order to show their devotion and undivided attention to their employees. Smithfield expresses concern for the welfare, health and safety of their employees, as the company communicate At Smithfield Foods, Inc. the safety, health and well-being of our employees is more important than our most valued customer. Here Smithfield communicates selflessness, as the company claims to put employees before customers and therefore also employees before profit. In terms of its employees, Smithfield expresses attention by stating We take an active role in supporting our employees. In order to proof this statement and their commitment towards their employees, the company gives following example For example, Smithfield Packing Company arranges for a low cost, on-site healthcare facility at Tar Heel for employees and their families. Here Smithfield supports their employees actively by providing them with low cost healthcare. Such an initiative is connected to great financial expenses, and therefore one might say that Smithfield makes an effort and invests financially in their employees well-being. Smithfield also expresses attention towards the community by using the goodwill dimension (8 out of 15 appeals). Again, Smithfield exclusively focuses on the appeal of attention in order to express their dedication to the community. The company states that their motivation for acting responsible towards the community is their license to operate We believe in helping the communities in which we do business who welcome us and allow us to operate. Smithfield here accounts for their responsibilities towards the community as a two-way relationship. The company is allowed to operate and in turn the company helps and supports the community. As mentioned earlier, the company invests in their employees health and well-being through providing them with low-cost healthcare. Smithfield then states Because theres a lack of affordable healthcare options in the area, weve also opened the facility to the local community. 59

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By opening this healthcare facility to the community, Smithfield shows attention and devotion to the local community, as the company listens to the communities needs and then meets those needs. Furthermore, the company provides learning opportunities and food for people in need. In these two latter issues, the company also communicates self-importance through stating Our hope is that this program will help give these young, bright students an opportunity to succeed and get ahead that they may not otherwise receive135. Here Smithfield emphasises that, if Smithfield would not have initiated this program, some of these students might never get the opportunity to succeed (see also section 4.3.1). 5.2.4 Conclusion on Smithfields ethos analysis Expertise is the dominating dimension in Smithfields CSR communication and the company seems to be eager to provide proof for its expertise to the reader. It does so by especially using the appeals entitlement, presence/resource and knowledge/skills. Smithfield uses entitlements to account for the companies achievements in concrete terms. Through knowledge/skills the company accounts for their acquired rank, merit, recognition, position or status. Here Smithfield both incorporates recognitions and awards as well as certification and expert endorsers. The presence/resources appeal is also used in order to show that Smithfield is able to perform and capable of fulfilling their responsibilities, e.g. by the use of systems and processes. In terms of character, Smithfield expresses mainly lawfulness and morality through the integrity/justice appeal and therefore mainly characterises itself as a moral company with respect to the law. Goodwill is mainly expressed through attention towards employees and the community. Smithfield here emphasises a two-way relationship with both stakeholder groups, as they state to give back to both employees and the community. Furthermore, Smithfield engages in philanthropy by e.g. supporting education, supporting healthcare and helping food insecure members of the community. Smithfield also expresses self-importance through stating that without the contribution of the firm, children might not have had the opportunity to succeed or learn.

135

Smithfields phrasing

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6. Discussion
In chapter 5 and 6, CSR discourse and ethos of respectively Arlas and Smithfields CSR communication have been analysed. In this chapter, the results of the analyses will be compared and discussed. First, the most interesting tendencies and results from the two analyses will be compared and discussed with the goal to determine whether they point towards the same results and which differences could be based on culture. Secondly, the culture based differences will be discussed in section 7.2.

6.1 Comparison of Arla and Smithfield


6.1.1 Response to problem areas In the discourse analysis in chapter 5, a CSR profile was created for respectively Arla and Smithfield. These profiles each identified two problem areas for each company in order to be able to point out how the companies respond to these problems in their CSR communication. It was pointed out that if the companies communicate on these problems extensively, these issues will probably be culture-free, as the issues will be influenced by a crisis in the company and therefore be company-specific. When comparing the two analyses, one can see that both analyses point towards the assumption that the companies use CSR as a tool to improve their reputation on these problem areas. Arla uses the ethos dimension character in order to account for the companys attitude towards bribes. More precisely, Arla uses the integrity/justice appeal in order to persuade readers that the company complies with the law and has high business morality by expressing that the company will never offer or receive bribes. Smithfield uses all three dimensions of ethos to appear credible and trustworthy. Expertise is used to communicate what the company has achieved and how they perform responsibly towards the environment in terms of processes and systems. Furthermore, the company establishes their knowledge and skills by accounting for recognition from 3rd parties in order to increase the trustworthiness of the statements. Smithfield uses the dimension character in order to communicate that the company has business morality as well as complies with laws and regulations. Goodwill is expressed through statements regarding the protection of water as well as through sponsorship and volunteerism at World Water Monitoring Day. By actively supporting issues which can be said to be very relevant regarding their past violation of precisely water contamination, Smithfield

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expresses to take an active role in protecting water resources and thereby trying to show their target audience and society that the company have changed. Smithfield has also had problems in the past with harassment of their workers. The company is therefore especially focused on communicating character, where integrity/justice is the most used appeal. Here the company refers to its non-harassment and discrimination policy and expresses compliance with the law and corporate policies. Furthermore, Smithfield uses goodwill to express general care towards their employees. Arla simply uses character in order to express to stakeholders that this problem area is not part of the company anymore. Smithfield on the other hand both dissociates itself from its problem areas through stating character, but also uses expertise to show that the company has become more knowledgeable and goodwill in order to increase the likeability of the company. 6.1.2 Relations to stakeholders Arla directly identifies four main stakeholder groups in their CSR communication, namely owners, employees, consumers and the community. This section will discuss how the companies present their responsibilities towards their stakeholders in order to establish if one of the two cultures seems to feel more responsible towards some stakeholder groups than the other.
6.1.2.1 Owners/shareholders

Arla is a cooperative and its owners are therefore members of the company136. Smithfield is a corporation with shareholders. Consequently, Arlas responsibilities are of a different nature than those responsibilities Smithfield has towards its shareholders. Arla expresses what the company can do for their owners in terms of membership, governance and insight into the company. Smithfield only states their responsibilities to their shareholders in one case: Our global perspective and commitment to inclusion are central to our mission to produce good food, responsibly, and ultimately maximize shareholder value. This statement shows that Smithfield does feel responsible towards their shareholders, however the company does not communicate further on this issue. Arla and Smithfield therefore communicate to two different stakeholder groups in this case, and cultural differences can therefore not be established.

136

http://nebs.ca/pdf/business/Business_structure.pdf

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6.1.2.2 Employees

In the analysis of Arlas discourse, it was established that Arla communicates on the workplace, working conditions, well-being, human rights and diversity in terms of employees. In the ethos analysis it can be observed that Arla mostly communicates character, due to statements of complying with human rights and Arlas business morality as an employer. In terms of goodwill towards their employees, Arla reports on a good working environment and the balance between private life and work. The company does, however, also emphasise that its employees are a resource to reach the companys business objectives and to create achievements for the company. The ethos analysis itself cannot reflect this tendency, as Arla expresses character and its expectations to achievement in a statement of character, e.g. We create a workplace that reflects society and its diversity, treats all employees equally and judges work achievements regardless of ethnic background, gender, age, religion, civil status or sexual orientation. In this statement Arla does not only communicate to respect diversity, but also communicates to judge work achievements. The discourse analysis shows that Smithfield also communicates on working conditions, human rights and diversity in terms of their employees. Smithfield furthermore expresses that health and safety of their employees is important to them, and that they take an active role to support their employees. This statement is confirmed in the ethos analysis through the use of the goodwill appeal with explicitly mentioned initiatives, such as a healthcare facility and a foundation for their employees families (see more in section 6.2). Smithfield furthermore communicates expertise to state their knowledge on federal regulation of health and safety. With basis in this knowledge, the company develops and describes systems and processes which exceed the federal laws. The most used appeal in relation to employees is character. Smithfield here mainly emphasises human rights, diversity, harassment and violence. Arla and Smithfield therefore both focus mostly on character when reporting on their responsibilities towards their employees. In terms of goodwill, Smithfield communicates twice as much on goodwill than Arla. Smithfield expresses to actively support employees, also in their private life through e.g. sponsorships for their children, grand-children etc. Arla does, however, only communicate briefly on goodwill towards employees. Their goodwill appeals concern the working life of employees, such as adapting work assignments to their capabilities.
6.1.2.3 Consumers

In the discourse analysis, it is established that Arla seems to communicate with consumers directly. The company does so by inviting all readers of the CSR section, including consumers, to share their

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views on CSR with the company as well as it communicates dialogue with consumer groups. Additionally, Arla expresses that consumers are their drivers to engage in CSR activities such as food safety and food and health, e.g. We satisfy consumer requirements for information about the connection between dairy products and health. It therefore seems that Arla appreciates and encourages dialogue and contact with their consumers. Smithfield on the other hand solely communicates their responsibility towards consumers by providing safe, wholesome foods for families throughout the world. It therefore seems as if Smithfield mainly sees their responsibility as providing consumers with a safe and healthy product, whereas they seem to value their responsibilities towards employees and community higher (see 6.1.2.2 and 6.1.2.4) The same results were found by Sotorrio and Sanchez137, who conclude that the European companies exceed the North American companies in their communication of responsibility with customers.
6.1.2.4 Community

While the ethos analysis shows that both companies use all three ethos qualities to approximately the same extend in this section, the discourse analysis reveals other tendencies. Smithfield focuses on communicating information about specific initiatives and projects in the local community in the US which improve peoples lives. The company furthermore seems to see their relationship with the community as a two-way relationship, where the community allows the company to operate, while the company gives back to the community some of the wealth it has created138. Arla focuses on stating that the company establishes a positive relationship with the local community, but does not define what this positive relationship consists of. In their research on cultural differences in CSR communication of 40 North American and European firms, Sotorrio and Sanchez139 found evidence that US companies express more responsibility towards the community in terms of foundation, grants, donations or sponsorships etc. This subject will be discussed later, in section 7.2.1, as it is closely related to the notion of explicit CSR.

137 138

Sotorrio & Sanchez (2008), p. 383 Morsing et al. (2006), p. 24 139 Sotorrio & Sanchez (2008), p. 383

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6.1.3 Providing proof Both the discourse and ethos analysis shows that Smithfield is very concerned with providing proof for their statements. To do so, the company communicates expertise. The company accounts for concrete achievements, processes and systems to fulfil their responsibilities and recognitions and certifications. The company also directly states you don't just have to take our word for it. Each award or honor provides tangible proof. It is therefore reasonable to say that Smithfield tries to establish credibility through providing the reader with proof for their statements through the use of the expertise. Arla on the other hand is not as concerned with providing proof as Smithfield. While the company also communicates on achievements and processes, it is generally vaguer in describing their initiatives and actions, as e.g. in terms of community. Here Arla simply states to have a positive relationship with the community, without explaining what this positive relationship consists of. The use of bullet-points and short text make it difficult to provide the reader with sufficient information or examples.

6.2 Differences based on explicit vs. implicit CSR


The previous section has compared Arla and Smithfield. The comparison has established some general differences in Arlas and Smithfields CSR approach and identified some cultural based differences. This section will use the theory presented in chapter 3 to point out and discuss cultural differences with the results of the discourse and ethos analyses. Matten and Moons explicit and implicit CSR framework will be discussed in this section in order to see whether their framework can serve to explain the differences of CSR behaviour obtained in these analyses. In chapter 3, it was established that explicit CSR involves corporate policies which assume responsibility for selected areas of interest of society140. Implicit CSR on the other hand is described by Morsing et al. as CSR embedded in the business-society-government relations within a political system in a way that we refer to as state-defined141.

140 141

Matten & Moon (2008), p. 405 Morsing et al. (2006), p. 26

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Explicit CSR
Describes corporate activities that assume responsibility for the interests of society

Implicit CSR
Describes corporations' role within the wider formal and informal institutions for society's interests and concerns Consists of values, norms, and rules that result in (often codified and mandatory) requirements for corporations Motivated by the societal consensus on the legitimate expectations of the roles and contributions of all major groups in society, including corporations

Consists of voluntary corporate policies, programs, and strategies

Incentives and opportunities are motivated by the perceived expectations of different stakeholders of the corporation

Figure 8 Matten and Moons explicit and implicit CSR142 As established earlier (see section ion 6.1.2.2 and 6.1.2.4), Arla and Smithfield communicate their goodwill towards employees and the community differently. While Smithfield accounts for doing good in the local community and for their employees, Arla states to make a difference in the local community, , but does not account for what they do. Smithfield reports on initiatives and philanthropic actions such as education, healthcare, food and volunteerism for the environment. According to Matten and Moons framework, Smithfield here takes on an explicit approach, as the company engages in voluntary corporate activities and accepts responsibility for the well-being being of the community and its employees. This can also be observed in the discourse analysis in section 4.3, where it was established that Smithfield reports selfself importance through stating that they provide learning opportunities for those that might not otherwise have them. . Smithfield therefore seems to believe that they have the possibility to improve the life of the people in the commun community. Arla does not account for philanthropic thropic actions or initiatives initiatives. Even Arlas sponsorships onsorships of activities in the local community as e.g. sport events, sport camps and Danish Football Association (DBU)143 are not mentioned at all in their CSR communication communication. This could be influenced by, what Morsing et al. call silent approach (see 2.4.3). They argue that Danish companies traditionally implement CSR without, what they would call, bragging about it. The open account for CSR or philanthropic

142 143

Matten & Moon (2008), p. 410 http://www.arla.dk/Arla-Forum/Aktiviteterevents/Arlas Forum/Aktiviteterevents/Arlas-sponsorpolitik/

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issues is regarded as very American 144 and Morsing and Schulz argue that there is a tradition in Denmark of not talking too much about CSR as often companies are perceived as self-complacent, self-absorbed or even distasteful as the company stage themselves as benefactors to a good cause, trying to look good while drawing on other peoples misery.145 The tradition has therefore been that CSR has been communicated through third party endorsements such as the media or expert assessments. However, Arla states We cannot change the world on our own, but we believe we can make a difference within the local communities, which indicates that Arla takes on responsibility for the interest of society. This could indicate a shift from implicit approach to explicit approach. However, since Arla does not express itself clearly on how it defines its relationship with the community, it cannot be concluded upon. Smithfield assumes responsibilities which contribute to the interests of society, such as healthcare, education and providing food for financially insecure families. These issues are implicit in the Danish culture, as Denmark has a national health care system, which provides healthcare paid through taxes. Therefore, it would not make sense if Danish companies would provide healthcare for their employees, as they are already covered by the state. Also in terms of education, Danish companies do not need to assume responsibility, as the Danish state guarantees and pays for education of all Danish citizens. The difference in communication of responsibilities therefore derives from different institutional frameworks. The US relies on explicit CSR influenced by less power of the state and more individual responsibilities to the people and organisations. In contrast, in the Danish culture, the state still has the responsibility for the well-being of the people and businesses therefore rely on implicit CSR. Arla is therefore far less likely to discuss philanthropic issues as part of their responsibility. In connection to the US tradition to have less governmental control and more individual responsibilities to the people, US businesses have traditionally engaged in self-regulation as well as external communication to demonstrate CSR146. This tendency can be observed with Smithfield, as Smithfield both reports on corporate policies, but also tends to proof that it is a responsible company (see section 6.1.3). It can also be observed through Smithfields use of character and the integrity/justice appeal. Even though Arla generally communicates more on character than Smithfield, the company mainly express compliance with existent laws and regulations, especially in accordance with their problem areas (see section 5.1.1), as well as general moral behaviour in terms of character. Smithfield on the other side, communicates to a greater extend self-regulation on
144 145

Morsing et al. (2006), p. 23 Morsing & Schulz in Morsing et al. (2006), p.30 146 Kampf (2007), p. 47

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diverse issues, such as corporate policies on health and safety, harassment and violence. In the issue of health and safety, Smithfield even expresses that the national laws lack some aspects, which Smithfield then regulates through corporate policies. Another question of whether Arla and Smithfield use an explicit or implicit approach can be seen by who the company are motivated by, as Matten and Moon argue that companies with an implicit CSR approach are Motivated by the societal consensus on the legitimate expectations of the roles and contributions of all major groups in society, including corporations, whereas companies with an explicit CSR approach are motivated by the expectations of their stakeholders147. As mentioned earlier, Arla seems to find their stakeholders, especially consumers, the driving force behind some of their CSR initiatives, as the company communicate We satisfy consumer requirements and We meet the aspirations of our stakeholders and regulatory authorities. Additionally, Arla also encourages their stakeholders to share their views with them. Arla therefore seems to be motivated by expectations and concerns from their stakeholders, such as consumers and authorities. Arla here takes on an explicit approach, as it is motivated by perceived expectations of different stakeholders of the corporation, which is defined as an explicit approach by Matten and Moon (see figure 8).

147

Matten & Moon (2008), p. 410

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7. Conclusion
The thesis aimed at providing an overview over the nature of cultural differences in the CSR communication of Danish and US companies through a case study of two companies. Furthermore the purpose of this thesis was to analyse how the companies communicate credibility in their CSR communication. This was based on the assumption that Danish consumers are more sceptical towards companies intention to communicate CSR and Danish companies therefore need to be more focused on appearing credible in their communication. The discourse of the two case study companies has been analysed based on a framework which helps to identify which issues the company communicates on, the processes the company uses in order to fulfil its responsibilities as well as the stakeholders which the company feels responsible to. The case study includes both a discourse analysis in order to examine the companies general understanding of CSR, as well as an analysis of ethos. The concept of ethos is constructed by three dimensions which are defined as expertise, character, and goodwill. The companies are therefore evaluated based on their ability to demonstrate expertise, character, and goodwill. The discourse analyses showed that Arla expresses itself through rather vague statements, where the reader could have difficulties to understand which exact responsibilities the company engages in. Smithfield on the other hand communicates extensively on its activities and initiatives in order to provide proof to the reader that it is an engaged and responsible company. The discourse analyses also showed that the two companies are motivated by different stakeholder groups. While Smithfield is mostly motivated by their responsibilities towards its employees and the community, Arla communicates its dedication to the consumers. The analyses of ethos showed that there were some general tendencies to be observed. When trying to establish credibility in the issues of employees, community and environment, both case study companies emphasise the same credibility appeals. Character and goodwill seem to be important in both the Danish and the US company when communicating on their employees. Both companies also emphasise character when reporting on the environment and goodwill when expressing their relationship towards the community. In terms of expertise, however, the two companies identify different issues. The US company Smithfield reports expertise in terms of animal welfare and the environment, whereas the Danish company Arla communicates expertise in terms of food safety.

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On the background of the two analyses, cultural differences have been discussed. It can be concluded that there are important differences in the CSR communication of the Danish and US company. The US company emphasises that being responsible means engaging actively in philanthropic actions towards their stakeholders. These philanthropic activities include healthcare, education and providing food for food insecure families. These activities are implicit in the Danish culture, as the well being of the people remains the responsibility of the state. Furthermore, the issue of compliance with the law showed some important differences. Whereas the Danish company relies on national law and authority, the US company not only communicates compliance with federal, state and local regulatory requirements and laws, but also on compliance with corporate rules and regulations, such as the code of conduct. Another aim of this thesis was to find out whether the Americanisation of the Danish CSR approach seems to be a reality. The answer is both yes and no. There seems to be some evidence that Danish companies move towards a more open and explicit approach to CSR. Arla is highly motivated by consumers to engage in CSR and thereby it takes on an explicit approach. Furthermore, Arla states in their CSR communication to improve the community, which also could be evidence towards more voluntary responsibilities. There is therefore evidence that Danish companies become more aware of stakeholders expectations and demands, rather to just rely on the institutions of the welfare state. However, the Danish CSR approach still reflects the Danish culture and the institutions of the welfare state. It is therefore unlikely that a complete Americanisation will occur very soon.

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Summary
Due to an augmentation of political consumerism, globalisation and information technology, focus on CSR communication has increased globally. Businesses from cultures that did not traditionally emphasise corporate social responsibilities face great challenge. How should they communicate on CSR without leaving behind their cultural traditions? Denmark is one of the cultures where the open account for CSR has not been well seen traditionally. However, scholars point out that the demand for CSR communication is still increasing and that Danish businesses have to move away from their traditional CSR approach towards and Americanisation of CSR. Here, one of the challenges for Danish businesses is the fact that Danish consumers are generally critical towards CSR and question businesses intention and motives to express CSR publicly. This thesis examines the general nature of cultural differences in CSR communication in the US and Denmark in order to examine how the national cultures influence the way CSR is communicated. Furthermore, the thesis analyses credibility in CSR communication in order to find out whether Danish businesses express credibility differently than US businesses, based on the above mentioned critical consumers. The empirical material for examining these questions is based on the CSR communication on the website of the Danish company, Arla Foods and the US company, Smithfield Foods. In order to answer the problem statement, two analyses will be carried out in this thesis. The first analysis identifies the CSR discourse of the two companies and the second analysis observes how the two companies express credibility. Cultural theory will not be approached operationally, but will be used for discussion of the analysis results. Cultural theory is mainly based on results from previous research by e.g. Matten and Moon and Morsing et al. Especially Matten and Moons notion of implicit vs. explicit CSR is discussed. In implicit CSR formal and informal institutions assign corporations an agreed share of responsibility for societys interests and concerns, e.g. through laws and regulations. Explicit CSR involves, on the other hand, corporate policies which assume responsibility for the interests of the society. Denmark is defined as a culture with an implicit approach to CSR, whereas the US is defined as a culture with an explicit approach to CSR. In line with their argument for Americanisation, Morsing et al. also claim that Denmark is moving from an implicit to a more explicit approach to CSR. In order to conduct the discourse analysis of the two companies, the thesis establishes which issues companies in the food industry emphasise in general based on Carrolls pyramid of CSR. The

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framework which is used for the discourse analysis incorporates the industry specific CSR issues in order to identify which issues the company communicates, which processes the company engages in to fulfil their responsibilities and to which stakeholders they feel responsible. The notion of credibility is defined as ethos, which consists of three dimensions of credibility, expertise, character and goodwill. These credibility appeals are identified in the CSR communication by using the Ethos model, which makes it possible to identify the three dimensions of ethos within rather fixed boundaries. Both analyses are carried through separately and then compared and considered in the discussion. It is also in the discussion that culture is compared to the results from the analyses. By comparing and discussing these two analyses it can be established that differences between the two cultures CSR still exist. Smithfield reports extensively on philanthropy and their CSR activities, on the contrary Danish companies still seem to fear the more open account for CSR. Arla here only gives vague statements on their responsibilities and activities. However, there also seems to be evidence that Danish companies take on a more explicit approach in terms of motivation by stakeholders, as Arla seems to feel motivated by their consumers rather than just by formal institutions. It therefore seems that Danish companies move towards an explicit approach by becoming more aware of their stakeholders.

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References
Books Baumlin, J.S & Baumlin T.F (1994) Ethos ew Essays in rhetorical and critical theory. Dallas, Southern Methodist University Press Fill, C. (2005). Marketing Communications. Essex, Prentice Hall Hoff-Clausen, E. (2002). Set gennem nettet - organisationers trovrdighed p hjemmesider. Kbenhavn: Samfundslitteratur. Lund, A. K., & Petersen, H. (2001). Det sku' vr s godt organisationskommunikation - cases og konsekvenser. Kbenhavn: Samfundslitteratur. McCroskey, J. (2001). An introduction to rhetorical communication Morsing, M.; Beckmann S.C. & Reisch, L.A (2006). Strategic CSR Communication. Kbh, Jurist- og konomforbundets Forlag. Nielsen, M. F. (2004). Spin, selvfremstilling og samfund - public relations som reflekterende praksis. Kbenhavn: Samfundslitteratur. Tench, R. & Yeomans, L. (2006). Exploring public relations. Harlow, Financial Times Prentice Hall Werhane, P.H & Freeman, R.E (1998). Blackwell Encyclopedic Dictionary of Business Ethics. Oxford, Blackwell Publishers Ltd. Articles Carroll, A. B. (1991). The pyramid of corporate social responsibility: Toward the moral management of organizational stakeholders. Business Horizons, 34(4), 39. Carroll, A. B. (1999). Corporate social responsibility: Evolution of a definitional construct. Business Society, 38, 268.

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Donaldson, T., & Preston, L. E. (1995). Stakeholder theory of the corporation: Concepts, evidence and implications. The Academy of Management Review, 20(1), 65-- 91. Jrgensen, P. E. F., & Isaksson, M.I (2008). Building credibility in international banking and financial markets - A study of how corporate reputations are managed through image advertising. Corporate Communications: An International Journal, 13(4), 365-- 379. Jrgensen, P.E.F. & Isaksson, M. I. (2009). The rhetoric of corporate mission statements: Virtues and emotions for the market. Language and the Market. Basingstoke: Macmillan Kampf, C. (2007). Corporate social responsibility - WalMart, Maersk and the cultural bounds of representation in corporate web sites. Corporate Communications: An International Journal, 12(1), 41-- 57. Maignan, I. & Ralston, D. (2002). Corporate Social Responsibility in Europe and the U.S.: Insights from Business Self-presentations. Journal of International Business Studies, 33, 3. Marrewijk, M. v. (2003). Concepts and definitions of CSR and corporate sustainability: Between agency and communion. Journal of Business Ethics, (44), 95. Matten, D., & Moon, J. (2008). "Implicit" and "explicit" CSR: A conceptual framework for a comparative understanding of corporate social responsibility. Academy of Management Review, 33(2) Macleod, S. (2001). Why worry about CSR? Strategic Communication Management. Nielsen, A. E., & Thomsen, C. (2007). Reporting CSR - what and how to say it. Corporate Communications: An International Journal, 12(1), 25--40. Sotorrio, L.L & Sanchez (2008). Corporate Social Responsibility of the most highly reputed European and North American Firms. Journal of Business Ethics, 82 van Marrewijk, M. (2003). Concepts and definitions of CSR and corporate sustainability: Between agency and communion. Journal of Business Ethics, 44, 95.

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Websites http://www.arla.com http://dolecsr.com/ http://europa.eu/scadplus/leg/en/lvb/n26034.htm http://localfoods.wordpress.com/2008/06/25/greenhouse-gas-emissions-from-agriculture/ http://nebs.ca/pdf/business/Business_structure.pdf http://www.arla.com/group/organisation/about-the-company/the-co-operative/ http://www.arla.com/press/archive/arla-attempts-a-comeback-in-the-middle-east/ http://www.arla.com/press/archive/breakthrough-for-arla-in-the-middle-east/ http://avisen.dk/maelken-afsloerer-din-politiske-holdning_78004.aspx http://www.benjerry.com/company/sear/2007/index.cfm http://www.business.dk/article/20040403/nyhedsoversigt/104030372/ http://www.business.dk/article/20040509/nyhedsoversigt/105090364/ http://dr.dk/Regioner/Fyn/Nyheder/Fynogoer/2008/01/03/184209.htm?wbc_purpose=updabr http://www.dr.dk/Regioner/Nord/Nyheder/Nordjylland/2007/08/10/082208.htm?rss=true http://www.danone.com/index.php?option=com_content&task=view&id=41&lang=en&Itemid=78 http://findarticles.com/p/articles/mi_m0EUY/is_31_12/ai_n26959360/ http://www.geert-hofstede.com/ http://www.geert-hofstede.com/hofstede_denmark.shtml http://www.geert-hofstede.com/hofstede_united_states.shtml 75

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http://www.heinz.com/sustainability.aspx http://www.heinz.com/our-company/ethics-and-compliance.aspx http://www.iblf.org/media_room/general.jsp?id=123788 http://www.kelloggcompany.com/corporateresponsibility.aspx?id=1526 http://kommunikationsforum.dk/?articleid=12048 http://kommunikationsforum.dk/?articleid=5511 http://www.kraftfoodscompany.com/About/ http://www.ks.dk/service-menu/publikationer/publikationsarkiv/publikationer-2008/00/4-hvadrisikerer-virksomheder-som-overtraeder-konkurrenceloven/ http://www.ibtimes.com/articles/20081219/nlrb-holds-off-on-certifying-smithfield-union-vote.htm http://www.lr.dk/kvaeg/diverse/t6madsps.pdf http://www.msnbc.msn.com/id/26369583/ http://www.nestle.com/CSV/CSVHome.htm http://www.opsi.gov.uk/acts/acts1990/ukpga_19900016_en_1.htm http://www.pepsico.com/Purpose.aspx ttp://www.pepsico.com/Purpose/Health-and-Wellness/Responsible-Marketing.aspx http://www.smithfieldfoods.com http://www.ugebrevet-europa.dk/artikel.asp?AjrDcmntId=439 http://www.unilever.com/sustainability/ http://www.unilever.com/aboutus/ourpeople/

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http://www.usdoj.gov/opa/pr/1997/August97/331enr.htm http://www.vionfood.com/811/Socially_responsible_business/ http://www.waterkeeper.org/mainarticledetails.aspx?articleid=216

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Appendices
Appendix 1: Analysis of industry specific CSR issues148 Appendix 2: Analysis of CSR issues a) Arla b) Smithfield Appendix 3: Ethos analysis a) Arla b) Smithfield Appendix 4: Ethos analysis numbers overview

148

My original analysis has unfortunately gone lost shortly before hand in, this is a short version.

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Appendix 1____________________________
Industry specific CSR issues
Legal Human resource policy as a binding policy within the company, complying with national laws (Danone) Compliance with laws, business principles, codes of conduct (Nestl) Legal compliance and integrity, Code of conduct, policies (Kraft Foods) Legal compliance, compliance with standards etc. (Dole Food Company) Compliance with the law, operating principles, code of conducts (Heinz) regulatory compliance, compliance with environmental permits, compliance with community right-to-know laws etc. (Ben & Jerrys) compliance with applicable legal and regulatory requirements and company standards and code of conduct (PepsiCo) Ethical Respect fundamental social principles, diversity (Danone) Support health & well-being of employees, training & education, resettlement for employees with job search services, training etc. (Nestl) Responsible marketing, diversity, health & safety (Kellogs) Enhancing the communities they do business in, no exploitation of farmers in third world countries, promote healthy lifestyle (Kraft Foods) Health & well-being of employees, diversity, vitality & wellbeing programs etc. (Unilever) Diversity, non-discrimination policy, no child labour, human rights, wages, working hours etc. (Dole Food Company) Fair treatment and wages, respect human rights (Heinz) Health & Safety, animal welfare (Vion) Fair trade, diversity and gender balance, values-led sourcing (Ben & Jerrys) Responsible marketing, promote healthy lifestyle, improve employment for employees with disabilities, diversity (employees and suppliers), human rights (PepsiCo)

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Environmental Preservation and protection of water resources, recycling of packaging material, sustainable agriculture (Danone) Sustainable agriculture, protection of water resources, environmental sustainability (energy, transport, packaging, by-products, waste etc.) (Nestl) Preservation of water & energy, sustainable agriculture, reducing environmental impact of products and production etc. (Kellogs) Preserving the planet, cutting down on CO2 emissions, reducing energy costs etc. (Kraft Foods) Sustainable agriculture, limiting production and product impact on the environment (reduce CO2 emissions, reduce use of water, packaging, etc.) (Unilever) Sustainable agriculture, nature conservation, prevent pollution etc. (Dole Food Company) Limit impact on the environment (water, transportation, energy, agriculture etc.) (Heinz) Environmental protection, energy and water saving (Vion) Sustainable agriculture, limit impact on the environment (Energy, air, packaging) etc. (Ben & Jerrys) Protecting natural resources (water, energy, packaging, waste), limiting impact on environment (PepsiCo) Philanthropic Community funding to promote social innovation, fighting malnutrition programs and share your meal program in Poland, working with UNICEF to provide water to local communities in Africa, Danones Childrens Day (Danone) Food education, obesity-prevention programmes, fighting diseases in Africa, funding of rural development in Africa etc. (Nestl) W.K. Kellog Foundation, Community development, charitable contributions and programs, education, diversity etc. (Kellogs) Fighting hunger, NGO cooperation, donations, volunteerism etc. (Kraft Foods) Donations to communities, responding to social needs, volunteerism, educational programmes, etc. (Unilever) Educational, nutritional, medical programs, drinking water, donations to local community etc. (Dole Food Company) H.J. Heinz Company Foundation, volunteerism, nutrition programs (Heinz)

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Financial donations to cultural organisations and public health (Vion) Volunteerism, Ben & Jerrys foundation, donations, Partner Shops (owned and operated by NGOs), etc. (Ben & Jerrys)

PepsiCo Foundation, humanitarian aid, disaster relief, donations, project funding, fight HIV/Aids (Pepsi Co)

Economic responsibilities Impact of their fiscal results on local community, society, charity etc. (Heinz) We recognise that economic growth has broader social and environmental impact (Unilever) Profit is essential in order to fulfil responsibilities (Vion) Profitable growth to create value (Ben & Jerrys)

Responsibilities

CSR issues in the food industry

Sub-issues

Legal

Compliance with the law

Ethical

Employees

Including: Workplace Diversity Health & Safety Other circumstances (fair trade, wage, working hours etc.)

Responsible Marketing

Promoting a healthy lifestyle

Labelling

Animal welfare

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Food safety

Environmental

Protection and preservation of natural resources

Including limiting the impact of the business operations on the environment

Sustainable agriculture

Philanthropic

Local community

In national country In countries where operations take place In third world countries

Foundations

Volunteerism

Economic

Economic achievement gains all make it possible to fulfil

responsibilities
Figure 2 Model of CSR issues in the global food industry

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Appendix 2____________________________
Analysis of Arla Foods CSR issues

CSR issues in the food industry

CSR processes

Stakeholder issues

Economic achievement

Management of business - Resources - Governance - Cooperative conditions - Transparency

Shareholders/owners

all of our owners must be provided with information...

...promotes the financial interests of our owners

Compliance with law - Legislation - Accounting and reporting - Bribes

All stakeholders

this enables us to act credibly and with integrity with all our stakeholders

Employees

Health and safety programs Working conditions

Employee stakeholders - Health and safety

we provide a safe and healthy work environment

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- Well being/working conditions

we create a stimulating workplace....we encourage employees to find a balance between their private lives and work

- Equal opportunity

we create a workplace that reflects society and its diversity, treats all employees equally and judges work achievements regardless of ethnic background, gender, age, religion, civil status or sexual orientation.

- competencies

we attract and retain competent employees

- pay and recognition

we offer fair and competitive wages

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Working conditions Do not accept: - Forced labour - Child labour

Employees - Working conditions

We not only provide food products but also a Respect: - Trade unions - Fair wages and salaries - fair working hours corporate culture that upholds internationally recognized human rights. This means that wherever we operate, we represent Arla Foods firm view that the human rights of all people must be respected.

Healthy lifestyle

Quality program

Customer stakeholders - Health

we inform our consumers about the ingredients in our products, so that they choose products that best match their tastes and needs

Animal welfare

Consumer stakeholders

We encourage and support milk suppliers in their efforts to adopt the latest farming practices, particularly with respect to animal welfare, in order to continuously improve the quality of life and physical environment of animals.

Food safety

Quality program - Standards - Knowledge

Customer stakeholders - Quality & Safety

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- Product Quality - Product recall - Allergies - etc.

Consumers must have confidence in our products...

We prevent and protect our consumers...

We meet consumer demand for safe dairy products

Protection and preservation of natural resources

Management of

Community/Society

environmental impacts - Protection of the environment - design new facilities and procure equipment - save energy and reduce material, waste and greenhouse gases - encourage suppliers at every level we consider whether we can change any aspect of our work methods in order to reduce our environmental impact

Management of environmental impact - Support of sustainable farming - encourage suppliers

Community/Society - Protection of the environment

we support agricultural methods that ensures

to protect environment sustainable farming in the short and long term

Community

Relationship with communities

Community stakeholders - Quality of life

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we believe we can make a difference within the local communities we interact with local communities and contribute positively to their development building strong partnerships

Foundation

Volunteerism

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Analysis of Smithfield Foods CSR issues

CSR issues in the food industry

CSR issues as presented by the corporation

CSR processes

Stakeholder issues

Economic achievement

Compliance with law

Code of conduct Corporate policies (Environmental, Human Rights, Health & Safety Policies)

Community & Employee Stakeholders - Health & Safety - Equal opportunity - Human Rights ...disciplinary actions for violation of policy or law ...uphold our enhanced safety policy and comply with all laws

Employees

Keeping Smithfield Foods Employees Safe

Health and safety program

Employee stakeholders - Health and safety Since our goal is to provide

Human Rights Policy Health & Safety Policy + Injury Prevention Management System

families around the world with high quality food, it stands to reason that we also feel great responsibility to our employees and their families. - Equal opportunity

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Healthcare Facility for employees and families Equal employment opportunity law Corporate policies

Smithfield does not discriminate against any employee or applicant for employment because of race, color, religion, ethnic or national origin, gender, sexual preference, age, disability, or veteran status

Healthy lifestyle

Food safety processes Animal welfare policy

Customer stakeholders - Quality & Safety ...our ability to provide safe, wholesome foods... ...to produce wholesome food products for our customers....

Animal welfare

Raising the bar in animal welfare

Animal welfare management system Gestation stalls Antibiotic Policy Accident Response Recognition

Food safety

Commitment to Food Safety

Health and safety program

Customer stakeholders - Safety & Quality

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To ensure our ability to provide safe, wholesome foods HACCP programs (Hazard Analysis and Critical Control Point) Facility Design & Construction We do this so that both our families and families throughout the world who eat our products can do so safely. for families throughout the world, we use a multitude of food safety processes and programs throughout our plants.

Protection and preservation of natural resources

Committed to protecting the environment

Management of environmental impacts

Community Stakeholders - Protection of the environment Providing good food

Volunteerism Sponsorship

responsibly means going above and beyond to be good stewards of the environment

Environmental Management System Certification & Awards (Internal & external) Recognitions by third parties

Community

Making a difference in our

Philanthropic programs

Employee and community stakeholders - Education 90

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communities

Sponsorships

- Quality of life ...we strongly believe that its our responsibility to give back to

Learners to learners Helping Hungry Homes

the communities where our employees live, work and raise their families. Our hope is that this program will help give these young, bright students an opportunity to succeed and get ahead that they might not otherwise receive.

Foundation

Smithfield-Luter Foundation

Employees and community stakeholders - Education Giving back to our employees and their families The company is dedicated to the continued well-being of our employees and communities.

Volunteerism

Committed to protecting the environment

Volunteerism

Community stakeholders - Protection of the environment ...providing financial support

World Water Monitoring Day

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waterways together with schoolchildren, 4-H groups, Boy Scouts, Girl Scouts and church groups.

General CSR statements

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Appendix 3 Ethos Analysis Arla


Economic achievement
Ethos quality Expertise Credibility appeal Examples

Entitlements / Enhancements World Knowledge Presence / Resources We operate the company efficiently by continuously optimising the use of raw materials, capital and human resources, in order to create value for our owners. Way of performing in concrete terms

Knowledge / Skills Abilities / Attributes Character Integrity / Justice We manage our business in a good cooperative spirit that promotes the financial interests of our owners. Integrity - business morality Truthfulness Passion Courage Goodwill Attention

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Enjoyment

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Compliance with the law

Ethos quality Expertise

Credibility appeal

Examples

Entitlements Enhancements World Knowledge Presence / Resources Knowledge / Skills Abilities / Attributes

Character

Integrity / Justice

In all of the countries in which we conduct our operations, and at all organisational levels, we obey the law. Justice - lawfulness We report our financial transactions in accordance with national legislation and we never accept or pay bribes.

Justice - lawfulness This enables us to act credibly and with integrity with all our stakeholders.

Integrity - business morality Arla Foods is committed to meeting or exceeding all applicable laws, rules and regulations in force in the countries in 95

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which we are active.

Justice - lawfulness Our management will take action on any breaches.

Integrity business morality We conduct our accounting and reporting in accordance with national legislation.

Justice - lawfulness We never, either directly or indirectly, accept bribes or other improper payments for the benefit of our business operations and/or for financial gain.

Integrity business morality We never offer or provide any gift or payment that constitutes, or could be interpreted as, a bribe.

Integrity business morality We will immediately reject and report to the management all demands, or offers of bribes.

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Integrity business morality We meet or exceed the laws, rules and regulations in the countries in which we operate.

Justice - lawfulness Truthfulness Passion Courage Goodwill Attention Enjoyment

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Employees

Ethos quality Expertise

Credibility appeal

Examples

Entitlements / Enhancements World Knowledge Presence / Resources We attract and retain competent employees and invest in their personal and occupational development in order to support our business objectives. Way of performing in concrete terms We constantly strive to ensure that our managers excel in terms of envision the future, engage people and deliver performance.

Way of performing in concrete terms Knowledge / Skills Abilities / Attributes Characters Integrity / Justice We create a workplace that reflects society and its diversity, treats all employees equally and judges work achievements regardless of ethnic background, gender, age, religion, civil status or sexual orientation.

Integrity business morality & Justice fairness

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We provide a workplace that counteracts harassment and we strive to create a working environment that offers our employees an opportunity to conduct work assignments that are adapted, where necessary, to their capabilities.

(and goodwill)

Integrity business morality & Justice fairness We offer fair and competitive wages and salaries and recognise and reward exceptional achievements.

Justice fairness We conduct our operations as responsible citizens and support and respect international agreements on human rights.

Integrity business morality We do not accept forced labour. Integrity business morality Nor should employees be required to pay deposits or surrender identification documents when we employ them.

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Integrity business morality We do not accept child labour, defined as work conducted by people under 15 years of age, or a higher age if local legislation stipulates a higher age limit and/or longer compulsory schooling.

Integrity business morality We respect the employees right to form and join the trade union of their choice, and to engage in collective bargaining.

Integrity business morality We ensure that wages, salaries and other types of remuneration meet or exceed the levels stipulated in legislation or industry standards in the countries in which we are active.

Integrity business morality & Justice lawfulness We abide by the legal and industry standards with respect to the working hours applicable in the countries in which we operate.

Justice - lawfulness

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Arla Foods was at the forefront of legislation and fulfill149 it to the full.

Integrity business morality We provide a safe and healthy work environment, and improve it continuously to avoid injuries and sickness.

Integrity business morality

Truthfulness

Arla Foods employees have a common way of working that is rooted in our values, regardless of where they work within the Arla Foods group. Collective moral constitution We not only provide food products but also a corporate culture that upholds internationally recognised human rights.

Collective moral constitution

This means that wherever we operate, we represent Arla Foods firm view that the human rights of all people must be respected.

Collective moral constitution

149

Arlas spelling mistake

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Passion Courage Goodwill Attention We provide a workplace that counteracts harassment and we strive to create a working environment that offers our employees an opportunity to conduct work assignments that are adapted, where necessary, to their capabilities.

(and character)

Devotion and undivided attention to employees It is our priority to ensure that all employees have good working conditions and are committed to their work.

Devotion and undivided attention to employees We create a stimulating workplace characterised by mutual respect and trust among employees, and we encourage employees to find a balance between their private lives and work.

Devotion and undivided attention to employees

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Enjoyment

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Animal welfare

Ethos quality Expertise

Credibility appeal

Examples

Entitlements / Enhancements World Knowledge Presence / Resources Working jointly with our Danish and Swedish owners, we have established ambitious targets for agricultural methods, animal health and feed quality. Way of performing in concrete terms The Arlagrden Quality Assurance Programme implemented in Denmark and Sweden and various other local initiatives ensure that we satisfy all applicable requirements for milk quality, environmental efforts at farm level and animal welfare.

(and character)

Way of performing in concrete terms

Knowledge / Skills Abilities / Attributes

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Character

Integrity / Justice

The Arlagrden Quality Assurance Programme implemented in Denmark and Sweden and various other local initiatives ensure that we satisfy all applicable requirements for milk quality, environmental efforts at farm level and animal welfare.

(and expertise)

Integrity business morality We ensure that all our milk suppliers implement and comply with our quality assurance programmes, taking account of local conditions.

Integrity business morality We encourage and support milk suppliers in their efforts to adopt the latest farming practises, particularly with respect to animal welfare, in order to continuously improve the quality of life and physical environment of animals.

Integrity business morality

Truthfulness Passion

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Courage Goodwill Attention Enjoyment

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Food safety

Ethos quality Expertise

Credibility appeal

Examples

Entitlements / Enhancements

We have set meticulous standards for food safety throughout the food chain, which means that we engage everyone, from our milk suppliers to consumers, in our food safety commitments. Entitlements what the corporation has achieved. During 2007 imposed a comprehensive work on food safety that Arla Foods' dairy in Sweden and Denmark meet the new ISO 22000 standard.

Entitlements what the corporation has achieved We got our results certified 27 dairies out of 61 were ISO-certified in 2007, and another 20 are in the course of 2008. Entitlements what the corporation has achieved World Knowledge Consumers must have confidence in our products. Universal truth

Presence / Resources

We maintain control over hazards in the manufacturing process by using a well functioning HACCP system and by empowering skilled employees. Capabilities or way of performing in 107

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concrete terms We offer safe products by using hygienic processes and facilities, and by following clear routines for personal hygiene.

Capabilities or way of performing in concrete terms We keep our premises free from pests by means of a proactive programme.

Capabilities or way of performing in concrete terms We have systems for tracing raw materials, ingredients and end products.

Capabilities or way of performing in concrete terms We have production facilities in many countries and our products are sold throughout the world.

Presence We maintain up-to-date knowledge of allergies and have robust purchasing and production procedures that prevent contamination. (and knowledge/skills)

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Capabilities or way of performing in concrete terms None of the farms delivered to Arla, but a comprehensive security program was launched to prevent proliferation.

Capabilities or way of performing in concrete terms Knowledge / Skills We keep ourselves abreast of food safety developments and ensure that we have the information and knowledge required to take preventive action.

Knowledge acquired by the members of the corporation We maintain up-to-date knowledge of allergies and have robust purchasing and production procedures that prevent contamination.

(and presence/resources)

Knowledge acquired by the members of the corporation In January 2008, Arla Foods joined the UN Global Compact, the worlds largest global corporate citizenship initiative.

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Knowledge membership of an organisation Abilities / Attributes Character Integrity / Justice Arla Foods vision of responsible business practice complies with the fundamental principles outlined in Global Compact. Integrity business morality We deliver products and ingredients, which comply with the necessary standards and specifications.

Integrity business morality We meet or exceed relevant standards when maintaining and cleaning buildings and equipment to ensure food safety throughout the supply chain.

Integrity business morality In seven cases, Arla called back the affected products due to risk of infection or wrong packaging.

Integrity business morality Truthfulness We were honest, and called the products back.

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Honesty

Passion Courage Attention Goodwill Attention To enable consumers to make an active choice we declare the ingredients of all of our products. Devotion and undivided attention to consumers We prevent and protect our consumers from being injured by foreign items and/or substances in our products.

Devotion and undivided attention to consumers If we detect a problem with our products we protect consumers by recalling products that are judged to be hazardous to health.

Devotion and undivided attention to consumers Enjoyment

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Environment

Ethos quality Expertise

Credibility appeal Entitlements / Enhancements

Examples Despite unchanged production volume, we have reduced the use of both water, CO2 initiative and energy of our dairies. Entitlements - achievements

World Knowledge

Presence / Resources

We design new facilities and procure equipment to meet or exceed relevant environmental standards.

Capabilities or way of performing in concrete terms We save energy and reduce material consumption by continually monitoring and optimising our operations.

Capabilities or way of performing in concrete terms We reduce waste from our operations by maximising the re-use, recycling and recovery of materials from our waste streams.

Capabilities or way of performing in concrete terms

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We have an established programme of regular visits to our milk suppliers in Denmark, Sweden and United Kingdom to ensure compliance with quality assurance programmes.

Capabilities or way of performing in concrete terms We contribute towards a reduction in global warming by striving to continually reduce our greenhouse gas emissions.

Capabilities or way of performing in concrete terms

Knowledge / Skills Abilities / Attributes

Character

Integrity/ Justice

We challenge and encourage our suppliers to develop and deliver products and services that exceed our environmental standards.

Integrity business morality

We meet the aspirations of our stakeholders and regulatory authorities by embracing our environmental

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responsibilities.

Integrity business morality This is our way of accepting responsibility for sustainable agriculture.

Integrity business morality We ensure that the production and/or use of feed and other raw materials on farms fulfil specific quality and safety requirements.

Integrity business morality We ensure that our suppliers receive fair payment for raw milk by applying payment principles based on content, quality and market value.

Justice - fairness Constantly seeking to minimise the environmental impact of our operations is at the heart of everything we do.

Integrity business morality We strive to continually reduce the environmental impact of our products.

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Integrity business morality and industriousness

At every level we consider whether we can change any aspect of our work methods in order to reduce our environmental impact.

Integrity business morality We cooperate closely with our milk suppliers and we support agricultural methods that ensures150 sustainable farming in the short and long term.

Integrity business morality We encourage all our milk suppliers to protect the environment.

Integrity business morality Truthfulness At the same time, it is unavoidable that production at our farms and dairies, and our transportation, affect the environment. Honesty Passion Courage

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Arlas spelling mistake

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Goodwill

Attention

Enjoyment

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Community

Ethos quality Expertise

Credibility appeal

Examples

Entitlements / Enhancements World Knowledge One way of spreading information and inspiration about positive eating and good cooking practices and ingredients is to sponsor events such as competitions for chefs and pastry cooks. Knowledge about business We are often a major employer at the locations where we operate.

Knowledge about the company Presence / Resources Arla Foods has operations across the world and acknowledges that it has a responsibility for society, the environment and the people who interface with our products and production.

(and character) Physical presence Knowledge / Skills Abilities / Attributes Character Integrity / Justice Based on our values, we cooperate respectfully and responsibly with local

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communities. Integrity business morality We operate sensitively in the societies in which we are active and develop longterm relationships through dialogue.

( and goodwill)

Integrity business morality Arla Foods has operations across the world and acknowledges that it has a responsibility for society, the environment and the people who interface with our products and production.

(and expertise)

Integrity business morality Truthfulness Passion Courage Goodwill Attention We regard ourselves as an active player in the communities in which we operate. Altruistic behaviour We operate sensitively in the societies in which we are active and develop long-

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term relationships through dialogue.

(and character)

Bond between corporation and the community To contribute to the development of the local community, we establish longterm151 relationships with people, companies and organisations.

Bond between corporation and the community

We interact with local communities and contribute positively to their development.

Altruistic behaviour Managers in Arla Foods are involved in both local and international networks with the aim of building strong partnerships and ensuring a global approach. Bond between corporation and the community

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We founded in 2007, "Arla Foods Young Scientist Award" to reward young scientists efforts. Altruistic behaviour In particular, we work to strengthen and enrich the Nordic food culture.

Altruistic behaviour Enjoyment

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Food and health

Ethos quality Expertise

Credibility appeal

Examples

Entitlements / Enhancements World Knowledge We satisfy consumer requirements for information about the connection between dairy products and health, so that they are inspired to choose products that fulfil their individual needs. (and goodwill) Knowledge about business Presence / Resources As a serious and reliable producer of foods and ingredients we use research as the foundation for all of our health initiatives. Capabilities or way of performing in concrete terms Knowledge / Skills We base our communications about nutritional issues on openness, dialogue and cooperation with authorities, experts, health information consultants and consumer groups. (and character) Cooperation with third parties We support research in this area to learn and to educate others about a balanced diet.

(and goodwill)

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Knowledge acquired through research Abilities / Attributes Character Integrity / Justice We base our communications about nutritional issues on openness, dialogue and cooperation with authorities, experts, health information consultants and consumer groups. (and expertise) Integrity - Business morality Truthfulness We only claim health benefits from our products if we have well-documented scientific evidence. Honesty We help consumers understand the role that dairy products play in a well-balanced diet, through comprehensive and honest product information.

(and goodwill)

Honesty Passion Courage

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Goodwill

Attention

We help consumers understand the role that dairy products play in a wellbalanced diet, through comprehensive and honest product information.

(and character)

Devotion and undivided attention to consumers We inform our consumers about the ingredients in our products, so that they choose products that best match their tastes and needs.

Devotion and undivided attention to consumers We support research in this area to learn and to educate others about a balanced diet. (and expertise) Altruistic behaviour Enjoyment We satisfy consumer requirements for information about the connection between dairy products and health, so that they are inspired to choose products that fulfil their individual needs. (and expertise) Corporations ability to generate 123

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satisfaction We provide consumers with nutritional information that instils confidence and peace of mind, and which inspires them to choose the products that satisfy their needs.

Corporations ability to generate contentment and joy, pleasure and satisfaction The aim is that our products and the information we provide will inspire and stimulate consumers to increase their interest in the link between nutrition and health.

Corporations ability to generate contentment and joy, pleasure and satisfaction

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General CSR statements

Ethos quality Expertise

Credibility appeal Entitlements / Enhancements World knowledge

Examples

It is imperative that our point of view is understood and people know what they can expect from us. Knowledge about business life/ conditions or the company This means that we need to convey our fundamental values not only to our employees and farmer owners but also to our customers and consumers.

(and character)

Knowledge about business life/ conditions or the company Presence / Resources Knowledge/ Skills Abilities / Attributes Character Integrity / Justice Arla Foods addresses ethical and quality matters in a sustainable and responsible manner, in order to safeguard the companys reputation and profitability.

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Integrity business morality This means that we need to convey our fundamental values not only to our employees and farmer owners but also to our customers and consumers.

(and expertise)

Integrity - Business morality Our objective is to develop our business on a foundation of long-term perspectives with respect for, and in harmony with, our surroundings. Integrity - Business morality Truthfulness Passion Courage Goodwill Attention We have good, honest relationships with all of our stakeholders. Bond between the corporation and stakeholders Enjoyment Our mission to offer modern consumers milk-based food products that create inspiration, confidence and well-being provides an excellent platform for our Corporate Social Responsibility agenda to engender confidence and security within a wider society over the long term. Corporations ability to generate contentment and joy, pleasure and

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satisfaction.

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Ethos Analysis Smithfield


Economic achievement

Ethos quality Expertise

Credibility appeal

Examples

Entitlements / Enhancements World Knowledge Our global perspective and commitment to inclusion are central to our mission to produce good food, responsibly, and ultimately maximize shareholder value. (and character) Knowledge about company Presence / Resources Knowledge / Skills Abilities / Attributes

Character

Integrity / Justice

Our global perspective and commitment to inclusion are central to our mission to produce good food, responsibly, and ultimately maximize shareholder value. (and expertise) Integrity Business morality

Truthfulness Passion Courage Goodwill Attention

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Enjoyment

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Employees

Ethos quality Expertise

Credibility appeal

Examples

Entitlements / Enhancements World Knowledge Smithfield Foods, Inc. has taken the approach that although occupational health and safety is highly regulated in the United States, more so than almost any other country in the world, 100 percent compliance 100 percent of the time with regulatory statutes is not enough to keep people safe. Knowledge about the world at large / about the US Many folks in industry when referring to "standards" are more often than not talking about regulations or law.

Knowledge about the industry Although here in the United States we have many laws and various Occupational Safety and Health Administration agencies, we generally lack an overall management system.

Knowledge about the world at large / about the US Smithfield recognizes that in some countries workers are not free to organize and join unions, and in such 130

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circumstances the company is open to other forms of worker representation.

(and character)

Knowledge about the world at large

Presence / Resources

These resources will be used to enable employees and contractors to work safely and comply with company policies and the law, to prevent pollution and to protect the environment. Way of performing in concrete terms

Our Corporate Director of Health and Safety ensures that all independent operating companies uphold our enhanced safety policy and comply with all laws.

Way of performing in concrete terms We've implemented a new Employee Injury Prevention Management System, building a culture where employee health and safety is a core value of our business.

(and character)

Way of performing in concrete terms

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The primary objective for Smithfield's EIPMS is to build a culture where employee health and safety are not merely a high priority, but core values of our business.

(and character)

Way of performing in concrete terms Knowledge / Skills Abilities / Attributes Character Integrity / Justice Smithfield Foods is committed to attracting, training and maintaining a diverse workforce that is reflective of the marketplace.

Integrity business morality We've implemented a new Employee Injury Prevention Management System, building a culture where employee health and safety is a core value of our business.

(and expertise) Integrity business morality Smithfield is committed to the protection and advancement of human rights, as enshrined in the Universal Declaration of Human Rights (UDHR) issued by the

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General Assembly of the United Nations on December 10, 1948.

Integrity business morality Smithfield does not discriminate against any employee or applicant for employment because of race, color, religion, ethnic or national origin, gender, sexual preference, age, disability, or veteran status.

Integrity business morality Discrimination against any employee or applicant for employment is a serious violation of equal employment opportunity law and of Smithfield's corporate policies.

Integrity business morality and Justice lawfulness It is the responsibility of every supervisory employee to ensure that discrimination does not occur and for every employee to report violations to our policy or the law.

Integrity business morality Smithfield is committed to providing our employees with a non-discriminatory work environment free of any type of harassment per company policy and the law.

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Integrity business morality and Justice lawfulness Supervisory employees must investigate all complaints of harassment and employees are advised on their responsibility to report violations.

Integrity business morality The company will take appropriate disciplinary actions for violation of policy or law.

Integrity business morality All verbal and physical threats of violent behavior are unacceptable and should be reported as outlined in the Smithfield Code of Conduct.

Integrity business morality Every report of violence or threats of violence will be investigated.

Integrity business morality Employees who engage in violence or threats of violence will be subject to disciplinary action, up to and including termination of employment as well as criminal prosecution.

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Integrity business morality Smithfield does not use forced or compulsory labor.

Integrity business morality Workers are recruited and receive competitive wages and benefit packages. Smithfield will not use child labor and respects the rights of children to be protected from economic exploitation.

Integrity business morality and Justice fairness Smithfield recognizes and respects employees' rights and freedom to choose whether to join or not join third party organizations or to associate freely and bargain collectively.

Integrity business morality Where applicable, Smithfield supports the rights of its employees to make these choices through fairly conducted secret ballot elections.

Integrity business morality Smithfield recognizes that in some countries workers are not free to organize 135

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and join unions, and in such circumstances the company is open to other forms of worker representation.

(and expertise)

Integrity business morality The primary objective for Smithfield's EIPMS is to build a culture where employee health and safety are not merely a high priority, but core values of our business.

(and expertise)

Integrity business morality Truthfulness Passion Courage Having a diverse workforce allows us to benefit from a variety of perspectives and strengthens our global competitiveness.

The corporations competitiveness

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Goodwill

Attention

We're continually working to improve processes that protect the health and welfare of our employees.

Devotion and undivided attention to employees At Smithfield Foods, Inc. the safety, health and well-being of our employees is more important than our most valued customer.

Devotion and undivided attention to employees Since our goal is to provide families around the world with high-quality food, it stands to reason that we also feel a great responsibility to our employees and their families.

Devotion and undivided attention to employees We take an active role in supporting our employees.

Devotion and undivided attention to employees For example, Smithfield Packing Company arranges for a low cost, on-site healthcare facility at Tar Heel for employees and their families.

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Devotion and undivided attention to employees Smithfield is committed to ensuring the health, safety, and well being of our employees, the people living and working in communities near our facilities, and the environment and will provide the human, physical and financial resources necessary to meet this commitment.

Devotion and undivided attention to stakeholders Enjoyment

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Animal welfare

Ethos quality Expertise

Credibility appeal

Examples

Entitlements / Enhancements

Murphy-Brown, our livestock production subsidiary, has developed the industry's most comprehensive animal welfare management program to ensure our animals receive proper care. Enhancements - achievements We have developed an industry-leading accident response program.

Entitlements - achievements World Knowledge Although they occur infrequently, accidents involving animals during transport can and do happen. Knowledge of the industry / the world at large Presence / Resources Knowledge / Skills Murphy-Brown, our livestock production subsidiary, has developed the industry's most comprehensive animal welfare management program to ensure our animals receive proper care. (and entitlements) Acquired rank, merit, recognition, position or status

We have developed an industry-leading 139

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accident response program.

(and entitlements)

Acquired rank, merit, recognition, position or status When it comes to animal welfare policies and processes, count on us to lead the way.

Acquired rank, merit, recognition, position or status In fact, we're recognized by the world's foremost experts in animal well-being as setting the standard for America's pork industryand we're applying those same best practices to our global operations. Acquired rank, merit, recognition, position or status The Animal Welfare Management System (AWMS) was closely developed with two of the world's foremost experts in animal behavior and animal handling.

Cooperation with 3rd party Experts from a variety of disciplines veterinary medicine, reproductive physiology, production management, marketing, management system administration, legal, logistics, and public affairsparticipated in an animal welfare committee to make sure animal well-being

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practices would be evaluated from many different perspectives.

Cooperation with 3rd party Today, our program serves as a model for other companies in the industry and, most importantly, assures our animals are safe, comfortable and healthy.

(and goodwill)

Acquired rank, merit, recognition, position or status Smithfield Foods based its decision on initial results from its own three-year study into sow housing to determine the impact such a switch would have on sows.

Knowledge acquired through research Smithfield Foods, Inc. is committed to being the industry leader in animal welfare practices to assure respectful and humane treatment of animals that we own or process, to produce wholesome food products for our customers and to analyze our operations and practices, including internal and independent third party audits, to ensure continual improvement.

(and character)

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Acquired rank, merit, recognition, position or status Abilities / Attributes Character Integrity / Justice Smithfield Foods, Inc. is committed to being the industry leader in animal welfare practices to assure respectful and humane treatment of animals that we own or process, to produce wholesome food products for our customers and to analyze our operations and practices, including internal and independent third party audits, to ensure continual improvement.

(and expertise)

Integrity business morality Truthfulness Passion Courage Goodwill Attention Today, our program serves as a model for other companies in the industry and, most importantly, assures our animals are safe, comfortable and healthy.

(and expertise) Altruistic behaviour Enjoyment

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Food safety

Ethos quality Expertise

Credibility appeal

Examples

Entitlements / Enhancements World Knowledge Presence / Resources Smithfield Foods recognizes that more than anything, our people are the vital part of our food safety programs. Way of performing in concrete terms In order to transfer knowledge and foster continuous improvement in food safety, the Smithfield Foods Safety Council was developed. Way of performing in concrete terms Smithfield Foods is constantly improving the facilities and equipment to ensure a safer, higher-quality product.

Way of performing in concrete terms

To ensure our ability to provide safe, wholesome foods for families throughout the world, we use a multitude of food safety processes and programs throughout our plants.

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Way of performing in concrete terms

Knowledge / Skills

The Food Safety staffs of each independent operating company remain on the cutting edge of food safety by attending and speaking at educational seminars, professional meetings and regulatory meetings.

Knowledge required through education and training Each company spends thousands of manhours training their employees in proper food safety procedures.

Knowledge required through education and training Abilities / Attributes Character Integrity / Justice At Smithfield Foods, the safety of our products is of paramount importance and is a daily, global, operational priority.

Integrity Business Morality

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All of us at Smithfield Foods never forget that we are working hard to produce the safest foods possible.

Integrity - Industriousness Truthfulness Passion Courage Goodwill Attention We do this so that both our families and families throughout the world who eat our products can do so safely. Devotion and undivided attention to stakeholders Enjoyment

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Environment

Ethos quality Expertise

Credibility appeal

Examples

Entitlements / Enhancements

Implemented over 150 individual projects in 2007 resulting in reduced water usage, air emissions and greenhouse gas emissions, improved energy efficiency and increased recycling Entitlements Implemented new metrics software to better monitor and measure environ-mental performance Entitlements Received approval for two additional facilities to join the EPAs Performance Track Program Entitlements Created a Bioenergy Task Force to explore alternative energy options Entitlements Participated in a pilot project on our company-owned farms to convert methane into electricity Entitlements

World Knowledge

Providing good food responsibly means going above and beyond to be good stewards of the environment. Knowledge of the company Water is one of the world's most precious resources.

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Knowledge of the world at large Presence / Resources Our employees played significant roles in achieving this certification and continuous improvement remains a key part of their responsibilities. Way of performing, in concrete terms Smithfield Foods, Inc. is committed to protecting the environment through pollution prevention and continual improvement of our environmental practices.

(and character) Way of performing, in concrete terms At our processing facilities and our livestock production subsidiary MurphyBrown we use an organized Environmental Management System to identify and manage every part of our operations that could have an effect on the environment. Way of performing, in concrete terms Instituted a Web-based training program to provide standardized training and certification for each processing facility's Environmental Coordinator Way of performing, in concrete terms Knowledge / Skills The American Meat Institute has recognized 54 Smithfield Foods facilities in 23 states for significant environmental stewardship efforts in their local communities.

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Acquired rank, merit, recognition, position or status

Smithfield Foods earns high honors from AMI annually.

Acquired rank, merit, recognition, position or status Smithfield Foods, Inc., Smithfield Packing South and Smithfield Transportation earned honors from the state of Virginia's Governor's Environmental Excellence Awards for Business and Industry for their environmental stewardship achievements.

Acquired rank, merit, recognition, position or status Corporate headquarters received a gold award; Smithfield Transportation, a silver award, and Smithfield Packing South, a bronze award.

Acquired rank, merit, recognition, position or status Smithfield Foods has been named to FORTUNE magazine's prestigious annual list of America's Most Admired Companies six consecutive years, ranking fourth among all U.S. food production companies in 2007.

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Acquired rank, merit, recognition, position or status The FTSE Group, an award-winning global index company, has named Smithfield Foods to its prestigious FTSE4Good Global Index Series for companies demonstrating globally recognized corporate responsibility standards. Acquired rank, merit, recognition, position or status Our commitment to environmental leadership is reflected in our ISO 14001 certification, the gold standard for environmental management, as well as in these other areas:

Acquired rank, merit, recognition, position or status Smithfield Foods was first in its industry to achieve ISO 14001 environmental certification for all U.S. hog production and pork and beef processing facilities. Acquired rank, merit, recognition, position or status

Abilities / Attributes Character Integrity / Justice The focus is not only on compliance with applicable rules and regulations, but also on finding ways to continuously improve. Justice lawfulness and Integrity business morality

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It is the corporate policy of Smithfield Foods, Inc. and its subsidiaries to conduct business in a manner consistent with continual improvement in regard to protecting the environment.

Integrity business morality Smithfield Foods, Inc. seeks to demonstrate its responsible corporate citizenship by complying with relevant environmental legislation and regulations, and with other requirements to which we voluntarily subscribe.

Justice lawfulness and Integrity business morality We will create, implement, and periodically review appropriate environmental objectives and targets.

Integrity business morality Truthfulness While we strongly believe that we have made, and will continue to make, great progress, you don't just have to take our word for it. How the corporation states its honesty and sincerity Passion Thats why were pleased to sponsor the National FFA Environmental and Natural Resources Career Development Event. What the corporation finds exciting and

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rewarding We are proud to provide scholarships they can use toward an education to help achieve that goal.

What the corporation finds exciting and rewarding We're honored to be recognized for the environmental efforts we've made over the years.

What the corporation finds exciting and rewarding Courage Goodwill Attention At Smithfield Foods we feel it's important to engage in activities that help protect this essential resource. Altruistic behaviour Our sponsorship of annual events such as World Water Monitoring Day (WWMD) is just one example of how we're doing just that.

Altruistic behaviour Smithfield Foods has been a corporate sponsor of WWMD since 2003, providing financial support and promoting employee participation in the event.

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Altruistic behaviour Smithfield Foods, Inc. is committed to protecting the environment through pollution prevention and continual improvement of our environmental practices. (and expertise)

Altruistic behaviour Enjoyment

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Community

Ethos quality Expertise

Credibility appeal

Examples

Entitlements / Enhancements World Knowledge Presence / Resources Knowledge / Skills We believe education is a key to strong, growing communities. Universal truth As a global food company, it just makes sense for us to focus many of our community involvement efforts on feeding the hungry.

(and goodwill)

Presence Abilities / Attributes Character Integrity / Justice At Smithfield Foods, we believe that being an active and sustaining partner in the communities in which we operate is not only good business, but also our role as a responsible corporate citizen. Integrity Business morality Truthfulness

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Passion

We're passionate about our involvement in educational initiatives that provide learning opportunities for those who may not otherwise have them. What the corporation finds exciting, rewarding and exhilarating And we're just as passionate about providing ongoing support to food programs that help feed the hungry.

What the corporation finds exciting, rewarding and exhilarating Our Learners to Leaders program gives us the ability to contribute to the future success of young individuals, as well as their communities.

What the corporation finds exciting, rewarding and exhilarating Courage Goodwill Attention At Smithfield Foods, we strongly believe that it's our responsibility to give back to the communities where our employees live, work and raise their families. Devotion and undivided attention to the target audience Because theres a lack of affordable healthcare options in the area, weve also opened the facility to the local community.

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Altruistic behaviour

The company is dedicated to the continued well-being of our employees and communities.

Devotion and undivided attention to the target audience Our Learners to Leaders national education alliance provides learning opportunities for those who may not otherwise have them.

Altruistic behaviour Our hope is that this program will help give these young, bright students an opportunity to succeed and get ahead that they may not otherwise receive. Altruistic behaviour Finally, we believe in helping the communities in which we do business who welcome us and allow us to operate.

Bond or partnership between the corporation and its audience As a global food company, it just makes sense for us to focus many of our community involvement efforts on feeding the hungry.

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(and expertise)

Altruistic behaviour We created our Helping Hungry Homes initiative to do just that.

Altruistic behaviour Enjoyment

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General CSR statements

Ethos quality Expertise

Credibility appeal

Examples

Entitlements / Enhancements World Knowledge Presence / Resources Therefore, Smithfield Foods has established a Diversity Advisory Committee to help the company identify opportunities to strengthen relationships with our customers, our employees, our suppliers, and in the communities where we have operations. (and goodwill) Way of performing in concrete terms Knowledge / Skills Abilities / Attributes

Character

Integrity / Justice

Smithfield Foods is committed to partnering with customers, employees and suppliers of diverse backgrounds and geographic locations, and to conduct our business in an ethical and inclusive way. Integrity business morality

Truthfulness Passion Courage Goodwill Attention Smithfield Foods understands that its customers, employees and suppliers are 158

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critical to its success as a global food company Relationship or bond between the corporation and its target audience Therefore, Smithfield Foods has established a Diversity Advisory Committee to help the company identify opportunities to strengthen relationships with our customers, our employees, our suppliers, and in the communities where we have operations.

(and expertise)

Relationship or bond between the corporation and its target audience Enjoyment We continually strive to reach out to a diverse customer base, and produce good food that will be enjoyed by families across the globe. Corporations ability to generate contentment and joy, pleasure and satisfaction.

159

CULTURE A

CREDIBILITY I CSR COMMU

ICATIO

Appendix 4____________________________
Ethos analysis numbers overview
102 sentences analysed for Arla and Smithfield, respectively. Arla: 112 appeals Smithfield: 111 appeals

160

CULTURE A

CREDIBILITY I CSR COMMU

ICATIO

Appeals according to CSR issue

Arla Economic

Smithfield

Expertise 1 1

Appeal:

Arla

Smithfield

Expertise

34

47

Character

54

41

Goodwill

24

23

Double appeals:

Expertise + character:

Expertise + goodwill:

Character + goodwill:

Double same appeals:

Expertise:

Character:

0 161

Goodwill:

CULTURE A

CREDIBILITY I CSR COMMU

ICATIO

Character 1 Goodwill 0 0 1

Lawfulness Expertise 0 Character 10 Goodwill 0 0 0 0

Employees Expertise 2 Character 15 Goodwill 3 6 20 8

Animal welfare Expertise 2 Character 4 Goodwill 0 1 1 10

162

CULTURE A

CREDIBILITY I CSR COMMU

ICATIO

Food safety Expertise 15 Character 6 Goodwill 3 1 2 6

Environment Expertise 6 Character 11 Goodwill 0 4 12 19

Food & health Expertise 4 Character 3 Goodwill 6 0 0 0

Community Expertise 3 Character 3 4 2

163

CULTURE A

CREDIBILITY I CSR COMMU

ICATIO

Goodwill 7 8

General CSR statements Expertise 2 Character 3 Goodwill 2 3 1 1

164