Assignment Business Research Report 1 - Company Exemplar

BUSI1033-195-C-BBA1M

Sihong Lu

2019021071

Yorkville University

Ethical and Responsible Business of Procter & Gamble

Moral and social responsibility of corporate has been hotly discussed in business,

and many companies use this way to add value to their brand. Procter & Gamble

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 (P&G) is a consumer goods manufacturer in the U.S., and it has been known as a

worldwide daily commodity company. Procter & Gamble has performed well in

ethical and responsible business. To analyze Procter & Gamble thoroughly, this paper

will briefly introduce the background of Procter & Gamble and its related industry.

Following this, this paper will discuss how Procter & Gamble performs its corporate

social responsibility.

Procter & Gamble is first established as a family factory, not only because of its

good quality and effective management, but also its corporate social responsibility, it

expands to a well-known and worldwide commodity corporate until now. It is named

after a candle-maker and a soap-maker, namely William Procter from England and

James Gamble from Ireland. Both of them went to the United Kingdom and settled in

Cincinnati. They came to know each other when they married sisters Olivia and

Elizabeth Norris. On October 31, 1837, the initial form of the company was built

under their father-in-law, Alexander Norris’s persuasion of becoming a business

partner. There are numeral events that lead to its success, some of which are

mentioned here. About twenty years later, it earns the first income of $1 million, with

about 80 employees. After that, during the American Civil War, the corporate was

stand out from other competitors and sold its products to the Union Army. The

reputation was set up, and their products were known to the general public in the

place. In 1887, a profit-sharing program was introduced by William Arnett Procter

who was a grandson of William Procter, on the assumption that strike was less likely

to happen among the workforce. During the time between the 1920s and 1930s, there

was a lot of popular radio programs which were named “soap operas” because of their

sponsor’s product and later the characters’ emotional features. In 2012, its sales

reached $83.68 billion, and it was called one of the most acclaimed companies in the

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 Fortune 500 by Fortune Magazine (2012). In 2014, a brand revolution took place, and

100 brands were cut off. The remaining 65 brands were able to produce 95% profits,

aiming to create a much simpler company to be managed and operated. At the end of

2018, its main products include Cleaning agents, Personal care products, Beauty Care

products, Personal Healthcare Products, Diagnostics, which are sold worldwide

(except Cuba and North Korea). It was one of the famously responsible corporates for

it taking part in all kinds of voluntary social activities.

P&G builds up the image of ethical and social responsibility in people’s mind by

performing its functions in those moral and social activities, such as community

impact, source sustainability, gender equality, and workforce diversity. Corporate

social responsibility means that there should be consideration of sustainability on the

foundation of commercial production. In other words, apart from the financial

conditions, the influences on society and the natural environment are supposed to be

stressed. Hooghiemstra (2000) indicates the reason why corporates highlight the

ethical and social responsibility because companies will use its functions to generate,

protect or develop their reputational image in the human’s mind, which leads to

financial returns. To improve the community impact, P&G launches the Children’s

Safe Drinking Water (CSDW) Program to deliver clean water for people in need.

When the disaster happened, P&G brings comforts to those in need, namely offering

free laundry to clean their clothes.

Moreover, as Hasseldine et al. (2005) have suggested it is more possible that the

efforts to protect the natural environment can develop the company’s environmental

image. Realizing this, P&G released the sustainability goals for 2030 during Earth

Week in 2018, which is going to have positive influences on our natural environment

and human society apart from making benefits. To be specific, a lot of things have

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 been done in terms of recyclable packaging, regeneration, and restoration, providing

transparency around our ingredient innovation and safety science, sourcing palm and

forests’ material responsibly, and developing a detailed environmental responsibility

plan for employees. As for gender equality, P&G makes products uniquely for males

and females. With the help of advertisement, it leverages the authoritative voice to tell

the world that gender stereotypes should be broken down, and it believes every girl

has the opportunity to get an education.

Most importantly, there is an inclusive working environment within the company.

Albinger & Freeman put forward in empirical research that ethical and social

responsibility activities are related to the company’s workers (2000). Employees are

inspired to work with their unique thought and voice in P&G, which advocates

diversity. A significant number of human-friendly policies, such as safety and cozy

environment, opportunities for promotion, teamwork, etc. are used to create a good

reputation among the industries. The firm is supposed to perform better with high

morale and productivity within the staff members. So far, despite some charges for

irresponsible behaviors since the last few decades, P&G has generated a respectable

corporate image through investments all over the world. Because of the ways, P&G

has rewarded to the general public and society, people come to believe in this

company and prefer to buy its products. McWilliams et al. (2006) indicate through the

ethical and social responsibility has an indirect relation to the product features, it is

considered as a means to create and enhance the reputational image.’’

In conclusion, P&G does well in addressing its corporal social responsibility.

P&G is built up from a small family to a worldwide corporate, and it has tried its best

to be an ethical and socially responsible company. The moral and social responsibility

is viewed as an intangible resource and P&G set it up from different types of moral

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 and social activities. That is to say, why people are likely to purchase products from

P&G is partly related to its excellent reputation. The moral and social responsibility is

such a powerful force that P&G has highlighted and stick to it in the performance.

References

Albinger, H. S., & Freeman, S. J. (2000). Corporate Social Performance and

Attractiveness as an Employer to Different Job Seeking Populations. Journal of

Business Ethics, 28, 243–253.

Fortune 500. (2012). About the Ranking of the Corporate Incomes. Retrieved from

https://money.cnn.com/magazines/fortune/fortune500/2012/full_list/index.html

Hasseldine, J., Salama, A. I. & Toms, J. S. (2005). Quantity Versus Quality: The

Impact of Environmental Disclosures on the Reputations of UK Plcs. The British

Accounting Review, 37, 231–248.

Hoogiemstra, R. (2000). Corporate Communication and Impression Management–

New Perspectives Why Companies Engage in Corporate Social Reporting. Journal

of Business Ethics, 27(1/2), 55–68.

McWilliams, A., Siegel, D. & Wright, P. M. (2006). Corporate Social Responsibility:

Strategic Implications. Journal of Management Studies, 43(1), 1–18.

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