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Case Study Analysis on Unilever
Introduction
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Corporate Social Responsibility is also known as CSR which refers to the business model that is self-regulatory and it also aids the company in becoming socially accountable to society, stakeholders and also to their customers or different individuals (Sharma, 2019). By engaging in CSR activities, the business organization can evaluate the different impacts they are having on the environment and society as well (Islam et al., 2021). By evaluating, the businesses can help society and the environment as well as build a healthy and positive brand image. The earth is already getting affected and the rising global warming is the finest example that can be recognised. By engaging in various reliable sources such as ProQuest, EBSCO, SAGE and google scholar have been utilized to find the information.
2. Literature Review
According to Carrol (2008), it is not a new belief that the company or many big business organizations have accountabilities towards the planet earth. In addition to that, it can be traced that the business responsibilities towards the planet earth centuries back.
2.1 Corporate Social Responsibility
As per Matten & Moon (2020), the operations of the business are directly accountable for the consumer behaviour, external environment as well as societal environment. Hence, CSR can be utilized as a strategic approach by different business organizations for overcoming the different negative impacts that can impact the external environment. Corporate Social Responsibility is also rising and attaining more popularity than ever among the different stakeholders as well as in this world of business corporations as per Alvarado-Herrera, Bigne, Aldas-Manzano, & Curras-Perez (2017). Furthermore, in these recent times, Corporate Social Responsibilities are essential for making effective competitive strategy for the business organization to generate as well as increasing the profits in the process, providing customer satisfaction, building customer loyalty, the reputation of the business organization and the positive brand image of the company as a whole as per Calabrese, Costa & Rosati (2016).
According to Nyadzayo & Khajehzadeh (2016), customer loyalty is among the major determinants and also a popular research topic for researchers as well as practitioners. Corporate Social Responsibilities are being utilized in the innovative industry, and support technological advancements for increasing customer engagement and boosting the market share of the business organization as well in the process. For instance; Pakistan telecom business companies such as Mobilink Ltd, Telenor Ltd, etc are actively and constantly engaging in the programs such as the provision of education, clean water and providing small loans are being supported actively and contributions are being made from different companies. Additionally, Chitra Bhanu Bhattacharya & Sen (2004) finds out from their research that shows that the business organization that are combining abilities of business with effective engagement in the Corporate Social Responsibilities activities are getting favourable responses from the customers. The abilities of the business organization can aid in moderating the relationship between Corporate Social Responsibility and market value as per Luo & Bhattacharya (2006).
According to Rasheed & Abadi (2014), different scholars belonging from different parts of the world found out that the abilities of the business combining as well as executing with the use of activities of the Corporate Social Responsibilities can heavily influence the customer in responding positively. In addition that David, Kline & Dai (2005) stated that the managers of the business organization consider Corporate Social Responsibility as the most critical and vital business strategy that has the ability to influence the behaviour of the customers including the purchasing decision. In response to that, approximately 90per cent of the top companies that are part of the “Fortune 500 Companies” are participating and engaging in Corporate Social Responsibilities (CSR). The satisfaction of the customer or consumer is the assessment that is based on the differentiation or the comparison among the experiences that are actual and perceived. The satisfaction of the customers can be defined as the positive feelings that can be experienced when satisfied as per Pan & Nguyen (2015).
From the modern perspective, Corporate Social Responsibility is involved capturing a different perspective that is considered valuable by the business organization in terms of meeting the needs and expectations of society and in the process, perceiving the benefits from the socially accountable actions of the business organization as stated by Jamali & Sidani (2008).
2.2 Business Ethics and Sustainability
As per Krishna, Dangayach & Jainabc (2011), Business ethics and sustainability are the two terms that can be found in the majority of business organizations around the world. Business Ethics and Sustainability is closely connected to Corporate Social Responsibility since it is CSR that is going to help the businesses in reaching business sustainability in the procedure. Business ethics and Corporate Social Responsibility are among the important component behind the corporate effective strategy (Lashley, 2016). As the world is progressing and advancing, the customers, as well as the consumers, are becoming more concerned about the wide variety of ethical conflicts and various impacts of business activities on society as well as the environment. It can be evident that “ethical consumerism” is already escalating in the world. Customers and consumers are becoming very attentive to various unethical practices of the business (Kiygi-Calli, 2019). So, the consumers or the customer expect a different business organization that is carrying their business operations to effectively engage in doing the business more ethically and pro-social behaviour that involves business organization taking accountabilities for their actions.
One of the first authors named Bowen (1953), debated that there are many social consequences of the business decisions that are being taken by many businesses’ organizations. Furthermore, he also stated that the manager taking effective and important business decisions not only affect the business organization but also the employees or the workforce working, stakeholders as well as the community of the business organization (Bowen., 1953). Business ethics involve some of the basic principles that help in guiding the business to conduct business more ethically. According to AMA’s (American Marketing Association) code of ethics 2019, a business organization must identify that they are bound to act as a steward of society for the creation, facilitation, and execution of the different transactions which contribute immensely to the global economy (Hunt, 2019).
Business Sustainability can only be essential and important when any business organization wants to grow, and expand in the long run and also in a sustainable manner (Hoffman, 2018). In this today’s world, there is a huge requirement for business organizations to become more transparent regarding their societal as well as environmental impacts and for that, the sustainability report is created.
According to Johnson (2009), Business Sustainability can be considered as being an important component of the “Triple Bottom Lines” for economic profitability, environmental responsibilities, and societal responsibilities. Customers are among the effective influencer when it comes to the development of sustainability via supporting and executing different practices that are sustainable. As per Nielsen (2011), the global research reports that customers are becoming more motivated and concerned with the various environmental problems and furthermore the consumers are also passionate about the CSR activities and initiatives by the business organization. The majority of the business organization that are part of the "Global Fortune 500 Companies” are conducting their business operations with respect to environmental sustainability (Zamil, and Hassan, 2019). These companies are aware of the fact that the customers’ expectations are changing towards taking care of the environment as well as being socially conscious in their shopping behaviour. The business is expected to conduct the business in an ethical manner that does not affect the economy negatively Furthermore, the companies must contribute to the betterment of the economy, society as well as the environment.
3. Methods
Most of the data that are used in this individual report are the secondary sources that involved articles, journal papers, internet searches as well as collecting necessary data or information from the library etc. The keywords that were used to find the data were Business Ethics, Ethics and business sustainability, Corporate Social Responsibility, CSR activities, ethics and corporate social responsibility etc. These keywords were used because they were relevant to the topic and using keywords, saves time for attaining relevant data or information. The secondary reliable sources that were utilized were Google Scholar, ProQuest, EBSCO as well as SAGE. Furthermore, the utilization of the official website of the company has also been utilized to prepare this report.
4. Findings and Analysis
4.1 Description of Unilever
Unilever Public Limited Company is a British multinational Consumer goods company that is based in the United Kingdom and the headquarter is situated in London. The company was founded on 2nd September 1929 with the merger of the LEVER BROTHERS and MARGARINE UNIE (Habep, 2021). The company deals in offering commodities such as ice cream, toothpaste, beauty products, breakfast items, personal care products etc. Unilever PLC is the largest producer of soap in the whole world. Unilever is also a multinational company that is available in different countries around the world and approximately it is available in 190 countries.
4.2 Critical Evaluation of Ethics and Sustainability Issues
There are four values that Unilever focuses on to meet their criteria for their set vision and mission; (A) Integrity, (B) Respect, (C) Responsibility, and (D) Pioneering Spirit. Unilever PLC is engaging in many activities to help in overcoming the ethics and sustainability issues (Chandra and Jatmika, 2022).
As per Unilever's Materiality Matrix of 2017 and 2018, it can be recognised that there are many issues that the company is trying to overcome by addressing the issues and making efforts accordingly. Agricultural sourcing is among the highest priority set by the company and the company is making effort in making sure that agricultural sourcing is becoming an integral part of the supply chain. Furthermore, Climate Action is also among the critical problem that needs to be addressed for overcoming the ethical and sustainability conflicts (Unilever, 2018). Unilever is concentrating on reducing the Green House Gas emissions, use of energy and also reducing the long-term impacts on the climate of the earth and the impact from the business operations as well. Unilever PLC is also actively engaging in meeting the ethical values of the company such as Human Rights is among the high priority list that needs to be addressed and solved in an effective manner.
The basic rights and freedom of each and every individual must be upheld and must be promoted as well such as not supporting child labour, equal opportunities furthermore the company is also making effort in dealing with the issues like forced labour, modern slavery, human trafficking, sexual harassment etc, these problems remain very relevant even after being in the high priority list of Unilever (Raja, 2021). The 4 values of Unilever help the company to carry the business operations with respect to these values. Unilever India which is also known as Hindustan Unilever has been told to pay ?5.5 lakh for involving in unfair trade practices. One of the Indian consumers filed a case against the company for not giving the winning prize money of ?5.5 lakh which was advertised through a detergent advertisement scheme (The Indian Express, 2013).
Unilever PLC is actively focusing on providing a safe and sound work environment to the workforce of employees as it is part of Corporate Social Responsibility which aids in overcoming ethical and sustainability issues. The company is effectively implementing CSR effectively but the problem is visible as per their people and safety report in which total fatal accidents were 7 in total in the year 2021 as compared to the total fatal accident of 3 in total (Unilever, 2021). Even after actively concentrating on these people and the safety aspect, the company is still not able to solve these issues. Unilever PLC is among the company which heavily believe in equality, diversity and inclusion work environment and culture. The company is making efforts such as opening new opportunities to LGBTQ employees and expanding them as well. In addition to that, Unilever evaluates its values and code of business practices and policies every single year to make sure that the business is operating ethically and avoiding all sorts of unfair practices (Singh, 2021).
The company has a “Zero Tolerance Policy” for any kind of bribery activities and fraud. Effective training is also provided to the employees for dealing with these kinds of activities responsibly. Environmental sustainability is still a big issue that is harming business ethics as well as sustainability (Hossain, Bashar and Noor, 2017). As per the statement of Unilever, the company is concentrating on harming the environment less for the protection and regeneration of 1.5 million hectares of land, forests as well as oceans by 2030 (Zhongming et al. 2020). Furthermore, the company is also having an ambitious plan of taking the company to "net-zero emission” by 2039 which is a positive sign for environmental sustainability but there is a certain time frame which indicates that in the meantime, the damages to the environment will be evident but it will be not in a larger scale.
The ethics and sustainability issues of Unilever are many and the company is implementing Corporate Social Responsibility effectively through many initiatives for conducting the business ethically and with respect to environmental sustainability.
Recommendations
For any business organization to be successful and impactful in the competitive business environment, there is a requirement for the business organization to conduct business organization ethically and with respect to environmental sustainability. Business ethics as discussed in the report that how these basic principles helps in guiding businesses to conduct business ethically and professionally. Unilever is focusing on taking the company to "net-zero emission" by 2039 which should be less in terms of the time frame. For example; Microsoft has the target year of 2030 to become completely carbon negative. Unilever should make efforts in closing the gap between the target year and Microsoft’s target year. One of the above points where the company engages in unfair trade practices with the customer is a break of the code of ethics of the company. Unilever PLC must put heavy emphasis on providing the goods and services to the customers fairly and it must never be sway from the statement, the company makes while advertising the commodities or services. In addition to that, it compromises the basic values of the company which are (A) Integrity, (B) Respect, (C) Responsibility, and (D) Pioneering Spirit. This type of unfair business activity can result in ruining the brand image and the goodwill of the company can be affected to a larger extent.
Conclusion
This report has come to an end and it has managed to discuss some of the relevant facts and information related to corporate and social responsibility in the light of ethics and sustainability issues. Unilever PLC is already focussing on meeting many objectives for accomplishing the different objectives of Corporate Social Responsibility. Furthermore, the recommendation has also been discussed and suggested. The company must seriously consider taking care of the basic ethical values that the business organization is breaking the code of ethics. The company have to invest a serious number of financial resources for reaching "net zero-emission" within a shorter time frame. This study has not managed to discuss in-depth information, facts or data about the ethics and sustainability issues as well as Corporate Social Responsibility.
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