CorporateSocial Responsibility: A Case Study of Coca-Cola Limited Company
Privateand public companies, academic institutes, government controlledcompanies, non-governmental institutions among other organizationshave embraced social responsibility in their workplace. The conceptis subject to questions from the research community who have donestudies over the years to determine its importance in organizations,especially the corporate world. The concept has grown in prominenceand significance over the last four decades. This report will focuson the relationship between ethics and social responsibility. It willthen analyze the CSR of a Coca-Cola company by looking at thebenefits and limitations of the organization`s responsiveness to thesurrounding community. Afterward, the report will give a detaildescription of CSR application in the company, analyze itseffectiveness and give recommendations on the possible areas thatrequire improvement.
Coca-Colais a brand name that has stood the test of time. It is a householdname whose presence in the world can be evidenced by the company’soperation in more than two hundred and twenty countries, spreadevenly all over the world. It is the most successful and leadingbeverage giant in the industry. There is much reason that has giventhe organization an edge over its competitors, and the main one beingthe great partnerships the company has made with communities all overthe world. It has a broad range of items in its production catalog,which includes over five hundred brands and approximately threethousand, three hundred beverages. The organization has created a“permanent” footprint in the market. Its continued success showsthis despite the changing market statistics. Even with the financialbreakdown that happened recently, the company remained operational.These achievements are largely attributed to their constant customerbase.
Theorganization has been operating for over 125 years. During this time,its stockholders have gained dividends that run into billions. Thelast 48 years have been great for the company because it has givenits shareholders more return on their investment, this is proof ofthe organization`s achievement in maintaining a constant marketpresence and popularity. The brand name of a company is more valuablethan the physical assets it possesses. The agency’s estimate of thevalue of their brand name is in billions of dollars. The company hasprotected the brand name for more than 100 years. Customers buy theirproduct because of this established trademark. The firm’s policyhas been to promote the brand name in each country separately.
Coca-Colacontributes a lot to the surrounding community. It has awell-established program that iscategorized according to the different sections of the companyoperations. In fact, it has employed people whose work is to create apersonal relationship with the community. The separation of thebusiness operations from the social responsibility enhancesspecialization. The company has a CSR section in every country thatconducts its operations. The employees tasked with his job, do notinvolve themselves with the activities of the business. Their work isto look for creative ways of establishing a positive company image.SCR often collaborates with the product promotion team whose work isto maintain the brand name and remind their customer of the variousproducts produced by the company. These two sections have sharedgoals.
Becauseof the company’s international presence, its corporate socialresponsibility is also global. To effectively make an impact, theprograms initiated to support the local communities of the respectivecountries are explicitly designed to take care of the needs of thatcommunity[ CITATION The13 l 1033 ].Therefore, the organization has tried to transform its globalresponsibility to suit the need of the immediate community. Althoughthis is an excellent idea, the company’s global status requires itto prioritize the world community before narrowing its responsibilityto particular societies. The company has initiated programs that havea global reach. For instance, the company participates in donationsto non-governmental organizations which have a worldwide reach. Theinstitutionalization of the CSR has enabled it to have anorganizational structure just like a regular firm would. Therefore,the CSR is more than a department within the Coca-Cola company. Ithas its mission, values, and goals separate from the beveragecompany. Every project initiated in any country has to be in linewith its goals and mission.
Toget a clear perspective on the challenges and benefits brought bysocial responsibility efforts to particular countries, we willanalyze Vietnam. Personnel manages the CSR activities from theheadquarters. This is an advantage because it unifies all theprograms initiated from other countries and supports easy monitoringand evaluation of the effectiveness of the initiated programs.Decisions are handled within a country by the company’s appointedstaff. The government, local Non- Governmental Organizations, andother local firms the areas that the project initiated will major onsuch as local communities, important water points, and factory sitesthe parts where the CSR will focus on such as water, education, andhealth. This are some of the decisions make at the country level.Allthese programs are unique and meant to cater for specific needs ofthe people of Vietnam[ CITATION The141 l 1033 ].
Theorganization uses a lot of water in its production activities. ToEnsuring the sustainability of water in Vietnam, the company throughits CSR programs has initiated projects which ensure the people ofthat country are not disadvantaged by the firm’s excessive waterrequirement. Coca-Cola has had challenges in many countries when itcomes to sharing of resources. From the lessons learned in othernations, the CSR has taken measures to ensure the society, who areits customers are not affected by their operations. Creating afriendly environment is crucial for the continued success of thecompany. Over the past years, people have protested in the streetsbecause of its large resource consumption with little investment tothe environment. If the company did not have an elaborate CSR, thenit could have lost a significant percentage of its market share.
In2006, Coca-Cola started a project whose main activity was to providea source of clean water to the schools in Vietnam located in ThuongTin, Lien Chieu, and Thu Districts. The major places that directlybenefited include schools and poor homes. The project alsoincorporated sanitation, where, construction of toilets has led to areduction in diseases. Awareness programs have been done, especiallyin schools to educate children on the importance of cleanliness.Coca-Cola has established a good relationship with internationalorganizations such as the World Wildlife Fund (WWF) and other NGOs.Also, the company has cultivated an active relationship with thelocal non-governmental organizations in the respective countries ofoperations. Maintaining this kind of relationships at a global levelis expensive and requires a lot of workforces[ CITATION The13 l 1033 ].
Beforecommitting funds to a project, the CSR conducts an evaluation of theneeds of the surrounding communities and puts them in a hierarchy.The most pressing need is dealt with first. Its employees do theassessment, and the report is produced in copies. The localmanagement reads one text, and the other copies are submitted to thehead office so that they can do their evaluation. CEFACOM is aninternational NGO that was given the task of accomplishing the cleanwater and sanitation initiative by Coca-Cola. Division of tasks is avaluable tool for efficient operations. Instead of sourcing forresources and workforce to execute the project, the firm choseanother organization to do complete the project. This partnershipshows the level of collaboration the beverage company has withnon-governmental organizations.
Thegoal of any profit making company it to increase its profits so thatthe shareholders can get more returns to their investment. Althoughsocial responsibility is an essential mix of a firm`s continuedsuccess, sometimes the expenditure in CSR programs get out of handand reduce shareholders profit margin by a significant percentage.Therefore, it is crucial that the expenses are as minimal aspossible. Coca-Cola spends a lot of money on this projects as ittries to maintain brand name in more than 220 countries. The CSRvision is to be financially independent of the firm. The sameprinciple of sustainability applies to the projects initiated by CSR.For instance, the clean water initiative in Vietnam is in the processof becoming financially independent. It is achieved by spreading theawareness about the techniques of protecting the water system and howto protect themselves from diseases through clean consumption ofdrinking water. With the help of the ministry of health, schoolleaders and communities have received training by experts from thehealth department[ CITATION The13 l 1033 ].
Aproject initiated by CSR has a higher chance of success if thecommunity is involved in the project planning and execution. Theproject team members can know the needs of the community they aregiving aid. A CSR program that does not consult the intendedbeneficiaries results into a project that does not meet theexpectation of the poor community. When employees volunteer in someof the projects, the managerial staff are encouraged to increasetheir CSR influence because of the support from its employees.
Constantevaluation and monitoring should be done to determine the performanceof a project. It is important because it enables an organization tolearn from its mistakes and make corrections. Furthermore, theexperience is applied in another project. The firm has done a lot tomonitor the progress of their projects, but more effort should beadded to efficiently access the performance of a program so that theresults of the project will help the community as was earlierintended
Acompany that appreciates the importance of social responsibility inits operations will last longer. CSR is not a form of charity. It ispart of a business strategy to enhance the company’s overallprofits. Therefore, all companies irrespective of the size ofoperations should incorporate a CSR in their organizationalstructure.
The Coca-cola Company. 2013. "2013 Annual Report on form 10k." Washingon DC.
The Coca-cola Company. 2014. "Annual report persuant to section 13." Washngton DC.