Corporate Social Responsibilities of Coca Cola Company - Case Study Example

The evaluation of Coca Cola Company Corporate Sustainability Report 13 against the Global Reporting Initiative Contents Contents 2 Introduction 3 GRI Guidelines 3 Corporate Social Responsibility and Global Reporting Initiative 4 Corporate Sustainability Report 2012-13 of Coca Cola 8 Employees: 9 Environment: 10 Society: 12 Suppliers: 14 Conclusion 14 References 16 Introduction Long term value of a company is enhanced by performing duties and responsibilities of corporate sustainability. It is an approach of creating long term employees and consumers by implementing various strategies which benefits the environment and society. The business considers every aspect of the society for establishing corporate sustainability. This essay explains Corporate Social Responsibilities of Coca Cola Company as per Global Reporting Initiative. Coca Cola is one of the leading firms of the world which deals with non alcoholic beverages. In the competitive business environment the company has to perform various responsibilities towards the society for maintaining its position in the market. The consumers and employees are very much concerned about social and environmental issues. So the company gets involved in performing all these activities to satisfy its customers and employees. CSR plays an important role in the growth and success of the company. Strategies of corporate sustainability focus on green product and services. Coca Cola’s strategies of corporate sustainability have changed over time as per its business needs and requirements. The concept of corporate sustainability is based on two vital principles. One principle focuses on increasing the resource of the company by benefiting society or environment. Another principle of corporate sustainability focuses on reducing risk of the company by increasing its business opportunities. This essay focuses on value creation process of the company by performing various sustainable approaches. GRI Guidelines According to GRI guidelines CR reporting must serve the needs of company’s stakeholders. It helps them to gain credibility. In the present time the stakeholders are using multiple channels to reach maximum number of people. The companies merge information of CR in their annual report. GRI guideline is gaining its popularity in recent years. To increase CR reporting programs GRI is putting a huge effort to promote its guidelines throughout the world. For example US and China are presently focusing more on connecting traditional standard setter with GRI program like SEC, IIFAC etc. GRI is launching a new guideline to make improvement in its standards. CR reporting will be benefited by improving global standard and performance of CR activities. Presently 80% of G 250 companies and 69% of N100 companies are following GRI guidelines and standards in developing their CR Report. Earlier these percentages were very low. Corporate Social Responsibility and Global Reporting Initiative According to GRI guidelines CSR reporting is an important to tool for the companies which are interested to become responsible corporate body. Learning and innovation plays a major role for driving CSR activities. CSR reporting helps to develop business and its products for getting different competitive advantages. CSR reporting is developing for past 18 years. By this process the companies develop strong communication with general people by showing its serious approach to help society and environment. According to GRI guidelines, companies of various countries implements sustainable measures for growth and development of its business. Social responsibilities which are performed by these companies benefit the society and the companies to improve its condition. Among 250 large companies of the world most of the companies report on their CSR activities. These companies are known as G250. The organizations are selected from the list of Fortune Global 500. G250 companies belong from various industries. Companies of different countries differ in their rate of reporting CSR activities (Shachman, 2004). GRI guidelines states that Companies of Europe reports more on their CSR activities in compared to the companies of other countries. Companies of America, Africa and Middle East are developing themselves for performing CSR activities. Half of the pacific and Asian companies maintain a report there CSR activities. The practice of maintaining corporate social responsibility report has become very popular. In the world on increasing consciousness CSR activities have become a crucial factor. In the early days CSR reporting was not considered as an important thing (Paul, 2008). But now a day companies from all over the world spends a lot on their CSR activities for achieving its growth and development. Reporting CSR activities has now become mandatory for many multinational companies. Top 100 companies of 34 countries are report on their CSR activities (KPMG, 2011). This is because the organizations have realized that expectations of stakeholders are more in regards to their accountability of business operations which are not always related to financial operations. It helps to enhance the value of business in every aspect. The companies maintain CSR reporting for establishing its position in the market (Isdell and Beasley, 2011). CSR activities help the company to perceive as a responsible corporate citizen. In this diagram it is shown that top hundred companies of 34 countries are performing more CSR activities than top 250 companies of the world. Learning and innovation plays a vital role in enhancing corporate responsibilities of the company. As a result these activities enhance many innovative business policies. It helps the business to develop various competitive advantages in the market. The growth of top 100 companies in producing CSR report has increased for past few years. 71% of European companies report on their CSR activities. Globalization plays an important role in maintaining CSR report (Frankental, 2001).As per GRI guidelines many companies expanding into Europe and US find difficulty in performing business operations in those countries. Growth and development of European countries influences the company to establish a path for profitable and successful CSR activities. Report of CSR activities helps to attract customers (Agle, 2008). The companies highlight their activities which show their effort of serving people and society. North American companies are experiencing a slow growth in producing CR report. Canadian companies experience less growth in this field (Garriga and Mele, 2004). The companies of Central Eastern Europe are following a very slow process in implementing CSR reporting system. CSR activities depend on the market size. A broad market with greater influence of global economy helps to spread awareness and needs of CSR activities and reporting. Companies of China perform its CSR activities on a large scale (Herrmann, 2004). 60% of large Chinese company produces a report on CSR activities. Three years ago performances of Chinese companies are at par with the companies of Netherland, Italy and Spain. In future it is expected that companies of China will experience CSR reporting in a wide spread. Russian companies also perform activities associated with sustainability (Herrmann, 2004). Large number of Russian companies produces CSR report which helps the companies to highlight their actions taken for the benefit of the society. CSR reporting is not very much popular on all emerging and developing market. Many markets are experiencing a very low level of CSR activities and CSR reports (Frankental, 2001). For example in India only 20% of companies produce a report on their CSR activities. In many instance Singapore acts as a leader in performing various business practices. But in regards to CSR report its position is very low (Hubbard, 2009). In the above diagram it is shown that the different companies of various countries producing report on CSR activities in 2011. It has been observed that the large the company is the more responsible it is in maintaining and producing CSR report. The large companies, earning more revenue needs to produce CSR report for maintaining transparency with their peers. CSR report of big companies also helps the small business to understand and learn the business opportunities of CSR activities (Garriga and Mele, 2004). In this figure it is explained that in 2011, the companies earning revenue more than US$50 billion are more involved in CSR activities and CSR reporting. But the companies earning low revenue do not performs much CSR activities. Therefore CSR activities and CSR reporting is highly dependent on company’s revenue.CSR reporting also varies according to the industry. Some industries have great impact of society and environment. For a long time companies of these industries maintain CSR report which shows their commitment towards society (Coca Cola., 2012). Corporate Sustainability Report 2012-13 of Coca Cola Coca Cola is one of the largest companies of the world. It mainly deals with non alcoholic beverages. The company has a large number of customers and employees all around the world. Coca Cola performs different CSR activities for benefiting the society, environment, customers and its employees. The company every year produces a report on its corporate sustainability for increasing transparency in business. The company believes that by producing this report it enhance organizational values and provides a broader view of this business (Kaplan and Norton, 2004). The organization desires to establish significant impact of its value chain process for achieving new goals of the company. Its various CSR activities help the company to implement sustainable management system for utilizing energy, water and other natural resources (Agle, 2008). Value chain system of Coca Cola is operated around 200 countries of the world. This process of the company depends highly on its customers, suppliers, retailers, distributors etc. They play an important role making the business sustainable. CSR report of Coca Cola discuss about its different stakeholders and activities of corporate responsibility performed by the company towards them (Mirvis and Googins, 2006). The organization is engaged with its stakeholders by various processes which helps the company to provide different benefits to them. Employees: Coca Cola take various measures for benefiting its employees. They are one of the most important stakeholders of the company. The organization implements and improves employee’s rights in the workplace which provides them various facilities. For improving the performance of employee the company conducts different training programs and development sessions which contribute a lot in the growth and development of the company. Coca Cola provides around 20 training programs and training resources online. It helps the employees to avail facilities at any time from any places (Siegfried and Zimbalist, 2000). Training programs of this company includes the process of clarifying different rights and responsibilities of employees and their policies of familiarization. The company implemented Global Mutual Respect policy where Coca Cola has explained how it expects its employees to deal and interact with each other. This policy values the diversified workforce of the company. It helps the employees to work in an environment where they do not face any harassment. This single policy helps the company satisfy its employees all around the world (Smeureanu, Dioşteanu, Delcea, and Cotfas, 2011). Employee relation is enhanced by this policy. The company provides various awards to its employees by considering their opinion. Coca Cola has established a safe and healthy workplace by implementing different policies. Medical facilities are given to its employees. It helps the company to minimize its risk related to injury, accidents of its employees. The organization has also implemented many safety measures for protecting its employees from hazardous situations (Smith and Westerbeek, 2007). Environment: For protecting environment from damages the Coca Cola has implemented many sustainable measures. The company performs various CSR activities to protect environment from different types of damages. One of the CSR activities of the company is to conserve water. For this reason in every bottle of Coca Cola there is a story which portraits the water as a most precious resource and its value is priceless. Water is the main ingredient of its product. So the company needs to protect water sources. It also helps in the sustainability of communities. The company plays a vital role in improving various water sources (Sparvero and Chalip, 2007). The organization is applying many improved ways of utilizing water in its products. Coca Cola also performs the duty of protecting watersheds. The firm spread awareness among the people about different issues related with water and its proper utilization. Coca Cola in Africa provided safe water to millions of people in Africa. It also contributed a lot for improving sanitation and hygiene of Africa. This process helps the company to improve the condition of 1600 communities and replenish 1.3 billion lt of water (Todd, 2009). The company has strategically aligned many water projects of community with its business system which are funded by the company. Coca Cola has made partnership with DEKA Research and development for providing safe drinking water to 1500 children. In this figure it is shown that the company over the past few years has significantly reduced the use of water in its product and business process. Packaging of products plays a vital role in protecting products and manages waste. The packaging materials used by the company can be recycled. This helps the company to reduce risk in distribution and transportation process of its product. The company uses good packaging material which does not harm the environment. The company has brought different machines of recycling it packaging materials (Waddock, 2004). These processes help Coca Cola to enhance its business sustainability. Coca Cola implements different measures for protecting agriculture, biodiversity, public health etc. The company plays a vital role in improving agriculture and reducing greenhouse gases. In this figure it is shown the amount of CO2 it has emitted in last few years from its manufacturing sites. The company implemented different measures to reduce carbon footprint. Coca Cola uses natural efficiently which helps the company to maintain various processes in befitting the environment (Walker and Kent, 2009). Society: The company believes that woman is an important part of society. They help the society in many ways. So for improving the condition of woman the company takes many initiatives. It contributes a lot in empowering woman. Coca Cola helps woman entrepreneur to start and develop their business (Steurer, Langer, Konrad and Martinuzzi, 2005). The organization is providing them many facilities to overcome barriers. The company conducts various training and development programs for helping woman to build their professional career. Woman empowerment program of Coca Cola provides a strong support to them (Walker and Parent, 2010). The company implemented 20 programs in 12 countries of the world which helped around 300,000 women. Coca Cola has also provided economic support to woman. It encourages woman to sell its products. In Africa Coca Cola has thousands of women distributer. In developing countries the company has many women farmers. 5million of women are benefited by the empowerment program of the company. It helps to enhance the value chain of the company (Yang and Sonmez, 2005). In this figure it is explained that now a day 66% of the world’s work are done by woman but they earn only 10% of world’s income. Women spent 90% of their income in their family and community. Therefore by empowering woman Coca Cola is helping the economy by increasing the money flow. Women invest a lot of money in education and health of children. So by helping woman Coca Cola benefits the society in many ways (Laplume, Sonpar and Litz, 2008). Suppliers: The company is also very much concerned about its suppliers. Coca Cola has implemented various measures to help suppliers for meeting quality and safety standards. The company provides different types of knowledge to its suppliers regarding different ingredients of its products. This process helps the suppliers to make them capable of meeting Global Food Safety Standard. The organization is also working on providing certification program to its suppliers (Phillips, 1997). Coca Cola assist and guides its suppliers on manufacturing process of different products which are required in the company. Various trainings are provided by the company to them which helps the suppliers to improve their business process. The company has implemented different guiding principles which help the suppliers to work in a better way with Coca Cola (Russo and Perrini, 2010). Conclusion In the modern world, Corporate Social Responsibilities has become a major function of the company for achieving growth and success. CSR activities help the company to pave the way for achieving long term growth. In this case study it has been discussed that different companies performs different types of CSR activities according to the need and requirement of society and people. The companies which perform activities of corporate sustainability seriously, they produce a CSR report every year. It helps them to maintain a transparent process for benefiting the society and people. CSR report mainly focuses on company’s effort for helping the society and improving various other factors which are associated with the growth and development of the nation. Though a large number of companies perform CSR activities but many companies are not so much efficient in producing CSR report. It has been seen that most of the European companies doing CSR activities produces a report of its. The percent is significantly in some of the developing countries of the world. The larger the company is the more CSR activities it performs and produces a report of it. Coca Cola is one of the largest companies of the world. It performs a wide range of CSR activities. For making its business process transparent the company also produces CSR report every year. References Agle, B.R., 2008. Dialogue: Toward superior stakeholder theory. Business Ethics Quarterly, 18(02), pp.153-190. Coca Cola., 2012. Coca Cola 2012-2013 GRI Report. [Online]. 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