Corporate social responsibility (CSR), a form of management that is defined by the ethical relationship of the company with all the public related, and by the establishment of business goals compatible with the sustainable development of society. Preserving environmental and cultural resources for future generations, respecting diversity and promoting the reduction of social inequalities. The environmental impacts of business activity are quickly and easily identifiable. The demand for responsible behavior with the natural environment is one of the first voices that rose in favor of corporate social responsibility and one of the most potent and organized movements of society. The pressure of business has been critical in this area, but other groups have picked up the baton and taking care of the environment is no longer an option for companies. The advancement of sustainable businesses is no longer reversed, and today no company can think of obtaining economic benefits without considering the social and environmental impact. This is demanded by consumers, but also by employees; the CEOs and the executives. According to Chakravorti, given political climates around the world and a new caution around international cooperation, business could be trying to pick up the slack on big issues from climate change to sustainable development. The demand for sustainable business may not only come from advocacy and executive groups but also from customers, investors, partners, and employees.
Public advocacy groups are an essential part of the business. They are the ones in charge of providing information to consumers about anything that might affect their welfare. The drives of public sponsorship groups have impacted several businesses. “We see corporate advocacy as an important aspect of how companies can demonstrate leadership and mobilize interest and action across peer groups, through their value chains and amongst a variety of stakeholders.” (Sim, 2017). Two examples of companies that have been affected by advocacy groups are Nike and Nestle. Nike, a company that says not to sell shoes but a sports spirit, received in recent years a series of complaints of mass layoffs, use of child labor, sexual harassment of dressmakers and lack of hygienic conditions in the factories. A massive international protest created, on the company’s initiative, a research commission that revealed the presence of 13-year-old girls in Kuong earning miserable salaries. A factory located in Indonesia allowed women to miss two days during menstruation, without being paid. The restricted access to toilets that exists as a standard in the factory and the sad fact that many women did not have money for compresses force this type of measure. As many women know that the lack of work harms them, most of them dressed in dark clothes and long blouses to avoid blood spots. “It is worth remembering that in the 1990s the global boycott campaign of Nike was so successful that it has now become an object lesson in how giant corporations can be brought to account by ordinary consumers.” (Birch, 2012).
Nestle, a Swiss multinational company, with more than 500 factories, is the largest food company in the world. They had around 20,000 children from Mali who have were sold to the landlords of the large cocoa plantations of Ivory Coast, the world’s largest producer. It would be excessive to accuse Nestle of being a slave, but the fact of not paying a fair price for the raw material did not help to improve the poor working conditions of the families that use their children to increase their income. One of the most criticized campaigns carried out by the multinational in several countries of the Third World was the one that encouraged the mothers not to breastfeed their babies by distributing in the first phase milk powder and baby jars for free. “Outrage started in the 1970s when Nestle accused of getting third world mothers hooked on formula, which is less healthy and more expensive than breast milk”. (Krasny, 2012). After a while, the women ran out of milk and ended up using these products which were unnecessary since they were not able to afford these products financially.
The company of Top Shelf is strengthened with a team of sustainable stakeholders, that cares about the welfare of the environment. Considering how important the company’s products are for the community, it is necessary for products to be environmentally friendly since that is one of the commitments the company has to carry out a sustainable business. “Stakeholder engagement is more than social responsibility. It is a key factor in successful business operations. Stakeholders help guide company leaders with necessary information regarding business development, regulatory issues, and public awareness.” (Leonard, 2018). The primary shareholders of the company are customers, employees, and suppliers. They are the most interested in the operations of the company and the treatment towards them.
In the same way, they are the first to benefit from the company’s achievements, just as they are the first ones to be harmed when the company makes mistakes. Since customers are the people who buy the products produced by the company, it makes them one of the most critical shareholders of the company. The fact that some customers burn shoes affects the environmental pollution, and that is why all the shareholders of the company, need to ensure that the guidelines of sustainable business are followed by all its shareholders for the success of the company. An additional stakeholder, corporate social responsibility (CSR), through this, business is committed to having policies that protect the environment.
The focus of Top Shelf is to work under the sustainable business, and this is the reason why the company follows product stewardship through eco-efficiency, to ensure that there is minimum health, environmental and social impact of a primary product where the packages used, go through all stages of the life cycle. According to Santangelo, one tool manufacturer can use to analyze their sustainability is the product life cycle assessment, which the U.S. Environmental Protection Agency (EPA) considers a cradle-to-grave approach. This cradle-to-grave approach begins with gathering raw materials from the earth to create the product and ends when all materials returned to the earth. Thinking about the product lifecycle helps manufacturers see the whole picture by actively and systematically charting each stage of a product’s life.
Knowing that almost all human activity generates an impact on the environment, we cannot ignore that our way of producing and consuming causes the tremendous environmental problems. Companies are focusing more on minimizing the impact on the environment, by incorporating rules where the protection of the environment is part of the business, as another tool to compete in the market. The reasons for incorporating environmental management is because society in general, consequently, with growing environmental awareness, develops a series of pressures that are felt by entrepreneurs. The environmental management systems are focused on eco-efficiency, continuously seeking optimization in the use of natural resources, the substitution of polluting products used in the company’s processes and the minimization of waste generation, to achieve mutual benefits environment and organization, promoting balanced development between social equity and resource utilization.
The company works hard to comply with the mission of eco-efficiency and stewardship because both are an essential part of the client’s satisfaction and confidence that products generated are suitable for consumption. Having this act of safety for consumers provides a sense of loyalty to the products. Both social responsibilities mean that organizations can be promoted and recognized in the business environment. The efforts of Top Shelf have been recognized, and for this reason, the company categorized, the best shoe producers. It is the responsibility of each of the groups to develop the program in excellence. Therefore, it is vital that they be included in the discussion since they all form an essential part of adding those interested in their operations to avoid future conflicts. “Defining the value created for and from each stakeholder group adds perspective, ensuring that you look at your business from all angles. Moreover, by focusing on value creation for all different stakeholders, will be a creating a business that is more sustainable in all senses of the word.” (Springman, 2011).
There is no active management system without multiple-stakeholders, a collective of people working with a common purpose, and for this to be possible, the leadership of top management is necessary. The requirements of the quality management system must integrate the essential processes of the organization, and its objectives must be part of the strategic planning. To achieve this alignment, the involvement of senior management and their ability to involve other people in the effectiveness of their work is essential. Some factors need to be considered when planning processes: the competitive environment, existing technologies, the legal framework, and corporate values. The correct management of multiple stakeholders causes substantial benefits such as:
Although the multi-stakeholder process consists of different advantages, there are also some disadvantages if the process is not implemented correctly. One of the problems that can be carried out is to identify and exchange ideas in the same way that could be one of the best advantages in carrying out this process. The fact that the multi-stakeholder is not in total agreement with the policies and objectives can be a disadvantage, as well as the incoordination in the decision-making, assuming the wrong decisions that the other partner could make, disputes and personal conflicts, that can arrive by the sharing of benefits or the excess exposure of one of the parties. Multi-stakeholder is an essential part of the company, and for this reason, all members need to be on the same horizontal to carry out wise decisions that benefit the future of the company.
- Risk reduction
- The development of better processes
- The generation of new products
- The opening of new business opportunities
- The consolidation of a corporate reputation
- The goodwill of consumers
- The reduction of personnel turnover
- The best stock market valuation
- The development of new markets
- Better relations with the government
It is crucial to implement the multi-stakeholder process carefully as it is an essential process for the future of the company. Conducting a stakeholder mapping exercise will ensure that no significant groups affected by the intervention escape. Select people with an approximately similar level of authority and maintain gender balance. Success depends on the implementation of the process, for this reason, it is necessary to take all precautionary measures while planning the implementation process. The Top Shelf sustainability plan in a structured one so all the milestones are identified and, therefore, must be in the process of multiple stakeholders. To meet sustainability goals the company produces products that do not affect the environment and are recycled to protect the next generation since that is the company’s focus. For Top Shelf, the implementation plan would be as follows;
- First, identify the stakeholders that are following the sustainability strategies. All parties involved in this plan must have a similar mission to avoid conflicts that affect the results of the company.
- Second, define regulations, policies, goals and work with a plan of accountability that allows keeping the team focused on the time limits. Intersected parties need to meet the financial and moral expectations of the company.
- Third, develop a pilot plant where parts of the operations that are being used with the current project can be implemented to determine if the process can be successful or not. For this reason, it is necessary that the development plan be on par with the objectives that the company has with the parameters of sustainability.
Chakravorti, B. (March 14, 2017). How companies can champion sustainable development. Retrieved from https://hbr.org/2017/03/how-companies-can-champion-sustainable-development
Sim, J. (November 7, 2017). Corporate advocacy as a cornerstone of sustainability. Retrieved from http://sustainability.com/our-work/insights/corporate-advocacy-cornerstone-sustainability/
Birch, S. (Jul 6, 2012). How activism forced Nike to change its ethical game. Retrieved from https://www.theguardian.com/environment/green-living-blog/2012/jul/06/activism-nike
Krasny, J. (June 25, 2012). Every parent should know the scandalous history of infant formula. Retrieved from https://www.businessinsider.com/nestles-infant-formula-scandal-2012-6
Leonard, K. (June 27, 2018). What are the social responsibilities of a company to its stakeholders? Retrieved from https://smallbusiness.chron.com/social-responsibilities-company-its-stakeholders-24841.html
Springman, J. (July 28, 2011). Implementing a stakeholder strategy. Retrieved from https://hbr.org/2011/07/implementing-a-stakeholder-str
Santangelo, M. (June 14, 2011). Product lifecycle assessment shows true environmental impact. Retrieved from https://www.fmanet.org/blog/2011/06/14/product-lifecycle-assessment-shows-true-environmental-impact