CSR: Corporate Social Responsibility
This practice of social responsibility in a company used to be seen as something a company did to help the local community and society out of the goodness of their heart. Now, it is a practice people expect from a company. With Fortune 500 companies making billions of dollars worth of profits every year, people expect them to be giving plenty of that back to their consumers and society as a whole.
Proctor & Gamble, one of the world’s leading health and hygiene companies, is definitely not exempt from this expectation. P&G seems to go above and beyond many other companies when it comes to corporate social responsibility. Even in the beginning, William Proctor and James Gamble formed a new enterprise with the inspiring purpose of “providing products and services of superior quality and value.” Since the company’s modest beginnings as a family-operated soap and candle, P&G has made a point of standing by those goals it’s founders set in place and continue to seek to improve lives now and for future generations.
Today, P&G has continued to set high goals of improving the communities where it has operations. The company has an extensive social responsibility plan that incorporates its vast array of product lines in health and hygiene. P&G’s policy on their duty to social responsibility states:
“We demonstrate our commitment to social responsibility by providing products and services that improve consumers' lives, in terms of health, hygiene and convenience. On a smaller scale, we contribute to the economic and social well-being of our employees, our shareholders and the local communities in which we operate. On a larger scale, we are involved in regional, national and international development. P&G contributes to social responsibility both in principle and in action.”
The company continues to follow this principle throughout the development of its products and its efforts in the community. One of P&G’s main objectives in social responsibility is to always conduct its business with integrity and a strong P&G core value of “doing the right thing.”
All of this looks great on paper. Any company can write down some policies and objectives and say they have strong involvement in the improvement of society. P&G goes leaps and bounds past its promise of “doing the right thing.”
Even before a company’s promise of social responsibility was a necessity to its consumers, P&G was reaching out. In 1915, James N. Gamble, a P&G founder’s son, was part of the creation of the first coordinated community campaign for charities, The United Way. The United Way is now the “leading community-based fund-raiser in the United States.” Today, P&G has embraced the World Business Council on Sustainable Development, WBCSD, definition of CSR.
The WBCSD five priority CSR areas:
Community Involvement
Employee Rights
Environmental Responsibility
Supplier Relations
Human Rights
In 1952, P&G began an initiative to coordinate the distribution of funds internationally to charities in employee communities called the Proctor & Gamble Fund. This was the first initiative of its kind. The Proctor & Gamble Fund later became part of the corporate philanthropy program Live, Learn, and Thrive. The Live, Learn, and Thrive program is P&G’s largest corporate cause that works to improve the lives of over 40 million disadvantaged children around the world.
Live, Learn, and Thrive is a P&G program that focuses directly on improving the lives of children in need from ages 0 – 13. The company feels that there is the greatest need in this segment and that “there is a clear fit with P&G strengths, brands and current programs.” P&G believes that with its resources they are able to:
- Help children in need live by helping ensure they get off to a healthy start;
- Provide children in need with places, tools and programs that enhance their ability to learn;
- Give children in need access to programs that help develop the self-esteem and life skills that they need to thrive
As a part of Live, Learn, and Thrive, P&G has developed an inexpensive way to purify contaminated water as part of the Children’s Safe Drinking Water program. Diseases caused by unsafe drinking water account for more than 5,000 deaths a day. P&G works with the U.S. Centers for Disease Control and Prevention in developing the Purifier of Water to reduce that number. By P&G providing the Purifier of Water to countries around the world, the product has already yielded millions of liters of safe drinking water for healthier living. This product has already been used by many organizations during global emergencies including the tsunami in Asia and floods if the Philippines.
P&G has also been very prevalent in disaster relief. Many of the company’s products are great help in times of disaster and rebuilding a community. Most of its contributions, money of product, are given to communities where P&G operations are physically located. It has been known to help in other areas with some of the company’s featured partners including the American Red Cross, UNICEF, United Way International, and Feeding America. P&G’s contributions usually consist of insuring “that teams are trained, disaster trucks are ready to roll throughout the world and emergency communications systems are in place.
One of P&G’s products, Tide, has been known for its help in times of disaster. Tide’s program, Loads of Hope, has helped families in need across the country by providing loads of clean laundry. Tide Loads of Hope provides disaster relief by giving people clean clothes because the company has learned that “sometimes even the littliest things can make a big, big difference.” In order to provide this relief, Tide sends its mobile Laundromat fleet to the location in need. The company has cleaned almost 30,000 loads of laundry for families affected by disasters.
Places Tide Loads of Hope has been:
Fargo, ND: Red River Flood (April 2009)
Galveston, TX: Hurricane Ike
San Diego, CA: Wildfires
Baton Rouge, LA: Hurricane Gustav
New Orleans, LA: Hurricanes Katrina and Gustav
Community involvement is not the only aspect of CSR that P&G follows. According to the WBCSD guidelines for CSR, P&G has a very open policy for employee rights. The company published a booklet outlining its values and code of conduct for anyone interested in learning about P&G’s CSR and Sustainable Development policies. The company also outlines its expectations of suppliers.
P&G also commits itself to being environmentally responsible. The company takes initiative to assure its customers that all products are passed by the Environmental Risk Assessment before they are safely cleared for the market. Before each product released into the market, scientists assess the impact it will leave on the environment and where it will end up after it is used. There is a lot of disapproval by consumers of P&G lack of environmental concern. Even though the company is doing research to assess the ecological risk of any product, some of the company’s products still have a significant negative effect on the environment.
SWOT Analysis:
Strengths:
- P&G has many strengths but one of their greatest is its vast array of product lines. It is a leading company in the health and hygiene industries and has the repertoire to show it. This quality of the company gives P&G an advantage to use its products to help others. P&G utilizes its products through many causes including Live, Learn, Thrive and Children’s Safe Drinking Water.
- Another strength of P&G would be the technology it has developed. It is known for its forward thinking and technological advances in the industry.
- P&G has kept to its founding values. It is very impressive that the company has been able to stand by its goals and values. Today, P&G continues to excel in CSR.
- P&G makes sure that its consumers and stakeholders know what the company is about and everything it is doing to get to its goals. The company website is incredibly informative. P&G wants to make sure that they can answer any questions its consumers might have.
Weaknesses:
- Even though P&G strives to make its products more environmentally friendly, it doesn’t mean it is there yet. The company performs fate research on all of its products before they go out into the market. This research evaluates what effect the product will have on the environment after it’s been disposed of; however, P&G did not state anywhere on its website the process that is involved in making the products.
- P&G has been greatly criticized for its testing of products on animals. There are many activists groups out there that have pleaded with people to boycott P&Gs products because of the company’s cruelty to animals.
Opportunities:
- Due to P&Gs vast array of products, it has great potential of helping people in many different ways. Just as Tide and Pampers have taken steps in improving lives of others in need, P&Gs other product extensions have the chance to reach out and help others in need. P&G is a leader in the health and hygiene industry, an industry that people all over the world need help it.
Threats:
- Some of P&Gs greatest threats are from environmental groups speaking out against the company’s practices. As more people start to see what P&G is doing behind closed doors, more people might turn to the company’s competitors in search of a more environmentally friendly company. This is something P&G needs to work on. P&G does so much for those in need, but in order to side step this threat, the company might need to work on its environmental efforts.
"We will provide branded products and services of superior quality and value that improve the lives of the world’s consumers. As a result, consumers will reward us with leadership sales, profit, and value creation, allowing our people, our shareholders, and the communities in which we live and work to prosper."
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