You are on page 1of 8

Case Study for Week 7-Group #D (Group Member: Daihan Cheng, Karen Manuharan, Kyu Bum

Kim, Maria Verone Tanteo)

Week 7

Daihan Cheng

Karen Manuharan

Kyu Bum Kim

Tanteo, Maria Verone B.

International American University

BUS 560: Business Ethics and Social Responsibility

Prof. Catherine Dolan- Garcia

February 19, 2017


Case Study for Week 7-Group #D (Group Member: Daihan Cheng, Karen Manuharan, Kyu Bum
Kim, Maria Verone Tanteo)
Beyond Corporate Responsibility: Social Innovation and Sustainable Development as

Drivers of Business Growth

The case study this week is mainly talking about Unilever CEO Patrick Cescaus

description on as a company how to find a sweet spot between achieving social responsibility

and environmental sustainability, and making a profit in the market. At the beginning of

introduction, he said that the market complex nowadays is far away from the laissez faire

economics in early eighties that social responsibility and environmental sustainability are core

business responsibilities instead of fringe activities.

In the 21st century, in order to be faced with social and environmental challenges, the

only solution is to gather government, NGOs and industry work together effectively. Of course it

could be difficult to balance the interests among the entities, it is slowly but surely that both

governments and NGOs are able to gradually accept that NGOs has a social role in the

development agenda beyond making a few charitable donations. Furthermore, every time when

they face some challenges, both of them will also have an opportunity for innovation and

business development.

Patrick indicates that participating in the agenda is not only a business strategy for NGOs,

but also a critical driver of business growth. He also asserted that the business success are mainly

based on three key premises: Firstly, economic development. Developing and emerging markets

can make a positive contribution to economics especially in developing countries; it can also

reduce poverty rate in the areas; Secondly, social innovation. Companies should do more to

tackle issues newly emerged in the society; Thirdly, sustainability. In order to be successful,
Case Study for Week 7-Group #D (Group Member: Daihan Cheng, Karen Manuharan, Kyu Bum
Kim, Maria Verone Tanteo)
companies should reduce their environmental pollution and increase the sustainability in their

production process.

For Unilever itself, the company always follow their two principles to do the business: First, the

business health and prosperity is closely related to health and prosperity in the community they

serve; Secondly, a successful business is a responsible business to the society as well.

Multinational companies play a significant role in the development agenda by stimulating

economic growth through international trade and facilitate social progress by developing human

capital. However, the positive role of business is not often mentioned in the media. Companies

do not usually measure their economic, social and environmental footprint in the markets they

operate as communication without facts is tough. Therefore, Unilever tries to find out the

impacts its operations have in the developing world and Patrick chose Indonesia. The report

shows several interesting things. Firstly, most cash value Unilever creates stays in the Indonesia

local economy which challenges the perception which NGO have that multinationals make large

profits locally and immediately extract the wealth to shareholders in London and New York

without benefiting the local economy. Secondly, it is found that 84% of the raw materials were

from local suppliers therefore creating jobs and transferring technology from Unilever factories

all across the world. Finally, the report also reveals that their operations in Indonesia have a

multiplier effect on job creation. The business supports full time equivalent of 300,000 jobs

where more than half is in the distribution and retail chain while Unilever Indonesia only

employs 5,000 employees.

The exercise revealed that the operation had limited impact in helping farmers and

shopkeepers to lift themselves out of poverty and also proves that it has a positive effect on
Case Study for Week 7-Group #D (Group Member: Daihan Cheng, Karen Manuharan, Kyu Bum
Kim, Maria Verone Tanteo)
developing countries. Patrick also initiated a second study together with Ethan Kapstein to

measure their footprint in quantitative terms and also analyses the soft impacts such as training

and skills transfer, support for government capacity building, black empowerment initiatives and

environmental standard setting.

Capacity building is used by economists to describe the creation of skills and physical

infrastructure, public health and administrative frameworks which are essential for developing

countries in order to prosper which can be built at the micro level of individual companies and

communities and also at the macro level of the state. Unilever engages at both levels in Africa.

An example pf macro level intervention is the work that Unilever was one of the founder

members of Investment Climate Facility which have committed 1M Euros to address some

structural bottlenecks holding back investments in Africa. Besides, an example of capacity

building at micro level is Business Action against Chronic Hunger which aims to help

communities out of poverty through sustainable income generation. Agronomists from

Unilevers Kenyan tea plantations are aiming to help farmers to convert their small holdings

from commodities to higher value crops like sunflowers, herbs and spices where Unilever

guaranteed to buy their crop at market prices which will then be used in Blue Band Margarine

and herbs in Royco. Unilevers aim is to enable farmers to earn enough money during the first

year and make a surplus for nest year where farmers agreed to put 10% of their surplus value into

community projects in future years in return for the help with training and start-up costs.

Unilever has high performance in fulfilling its corporate social responsibilities. This

performance is notable even though the Unilever Foundation was globally launched only in

2012. The global reach of the companys business partners, supply chain and distribution

networks facilitates the large-scale positive impact of its CSR strategy. Nonetheless, increased
Case Study for Week 7-Group #D (Group Member: Daihan Cheng, Karen Manuharan, Kyu Bum
Kim, Maria Verone Tanteo)
market presence can enhance such performance. For example, Unilever can use its strong brand

image to raise consumer awareness about community needs. This recommendation emphasizes

the need for public awareness to support the corporate citizenship activities of the company and

related organizations. Unilever has announced the next wave of innovation challenges as part of

the businesss commitment to sustainable living.

The Transform initiative is a result of a partnership between the UKs Department for

International Development (DFID), the Clinton Giustra Enterprise Partnership (CGEP) and

Unilever with the aim to create jobs, increase incomes and improve the health and wellbeing of

100 million people in developing countries by 2025, in support of the Global Goals.

Transform is a further commitment to the Unilever Sustainable Living Plan (USLP),

which aims to double the size of the Unilever business while reducing the companys

environmental footprint and increasing its positive social impact. The Transform initiative will be

a five year, minimum 10 million, programme that will initially focus on water, sanitation and

hygiene (WASH) and household energy. The project is the first initiative to be launched since

Unilever and DFID committed to working together to help the worlds poor in 2014 and the first

partnership of its kind between a leading international business and DFID. CGEP joins as the

first Partner, bringing its expertise in last-mile distribution.

Dove commissioned new research with social media scholar and Principal Researcher at

Microsoft Research, Danah Boyd, to better understand how girls are engaging with and effected

by social media. 95% of girls have seen negative beauty posts, comments, snaps, videos or

photos, and 72% see these beauty critiques at least once a week4. The next generation is

growing up fully immersed in a social media world where female empowerment is at its peak,
Case Study for Week 7-Group #D (Group Member: Daihan Cheng, Karen Manuharan, Kyu Bum
Kim, Maria Verone Tanteo)
said Danah Boyd. Girls have heard the message loud and clear that positive self-image matters,

but theyre also struggling with what it means in practice. Were seeing a growing desire among

the next generation to change the world through social media movements, and we have an

incredible opportunity to offer girls the online tools to make this change happen.

Majority of companies around the world are considering the issues of sustainability as the

term actually matters to everyone. Sustainability consist of not only environmental issues but

also economical and social norms. Not long ago, companies started how to go green and with

minimum natural resources they initiate plan to maximize the outcome of raw materials. This

matter became reality after the consumer has become part of the companies.

The consumers of companies now want to make sure the people who are supporting for

their goods. One of example would be coffee companies, they are willing to provide necessary

goods for their supply chains; Columbia. Not only coffee companies but also numerous

businesses are willing to take part in eco-ethical project. What consumers want to see is the

change of it not the formal news. It is very obvious if certain company is practicing sustainability

or not.

The sustainability would not be favorable to all of companies but certainly it does provide

vast opportunities and innovating futuristic companies. The Lipton one of most famous and

company supplying the tea is also taking steps of sustainability. Now the company Lipton

established to support their supply chain developing countries, The Lipton Company can lift

more than 2 million people from starvation, and poverty.

Not all companies will continue to be genuinely sustainable. The reason for explanation

is that if the companies fail to do the sustainable actions, the win-win business will never come.
Case Study for Week 7-Group #D (Group Member: Daihan Cheng, Karen Manuharan, Kyu Bum
Kim, Maria Verone Tanteo)
As in business sense, happy cows make happy cheese. What it means is that if companies can

support and interact with consumer and farmers and have great communications, there will be

better bright future. If companies are hiding the truth and makes no effort, the result will be

negative.

In conclusion, the businesses around the world must dedicate and have social

responsibility plus sustainable plans as it is no longer option for them. Now that we

acknowledge it is crucial for our society and company, the guidance to employees and young

adults is necessary. At the very end, what it matters to all the businesses are the internal and

external consumers and the suppliers. If we all know how of corporate social responsibility,

sustainability and how we should treat our society there wont be people who are suffering from

lack of anything.

References
Case Study for Week 7-Group #D (Group Member: Daihan Cheng, Karen Manuharan, Kyu Bum
Kim, Maria Verone Tanteo)
MacDonald, C. (2013). Business Ethics: Decision-Making for Personal Integrity &

Social Responsibility.

Ditlev-Simonsen, C. D., & Wenstop, F. (2013). How stakeholders view stakeholders as CSR

motivators. Social Responsibility Journal, 9(1), 137-147.

Dove. (2016). Dove and Twitter Launch #SpeakBeautiful Effect, a New Technology That

Analyzes Tweets About Appearance to Help Us Realize the Emotional Effect of Our

Online Words. Retrieved from: https://www.unileverusa.com/news/press-

releases/2016/new-dove-research-reveals-girls-want-to-make-social-media-a-positive-

place.html

Miles, M. P., Munilla, L. S., & Darroch, J. (2006). The role of strategic conversations with

stakeholders in the formation of corporate social responsibility strategy. Journal of

Business Ethics, 69(2), 195-205.