Corporate and Personal Responsibility: Drink and Food Sector
Corporations in this contemporary world have the obligation to protect consumers against any harm inflicted from use their products. It is important to note that some corporations have taken corporate responsibility seriously and this has been factored in their profit endeavors. Universal Declaration of Human Rights puts forth emphasis that, corporations should carryout activities that are not only intended to make profit but should also be for the good of all citizens. This will create a friendly environment that will be beneficial to both the public and the corporations hence leading to positive growth in all aspects (Beauchamp & Bowie, 1996). The kind of relationship created between customers and companies is that which is beyond financial and should include ethical aspects. Corporate responsibility is therefore the driving force behind the progress of any business organization while personal responsibility fosters the wellbeing of an individual.
Nonetheless, it has emerged in recent times that some companies are unwilling to undertake corporate responsibility because of fear of reduction in their profit margins. This has prompted some companies to involve themselves in activities that are detrimental to human health and environment. To protect its citizens from these, governments have introduced laws and regulations that are aimed at forcing such organization to take corporate responsibility in order to maintain a good and favorable environment for all (Sprenger, 2000). To provide example, some governments have introduced regulation that require each and every company to consider its carbon footprint and water foot print. In addition, other watchdogs and advocates like civil societies have come out strongly to monitor production activities of certain companies that would impact negatively to the society.
Accountability for one’s action is quite imperative and this applies to both individual and corporations. Instead of just involving in monitoring, auditing and reporting on the vast activities, corporations must also put emphasis on complains relayed to them by their consumers about issues involving neglect of corporate power and malpractices. In addition, apart from organization’s self control and deliberate methods as substitute for governmental and international regulations, the organization should implement a blend of both deliberate and lawful approaches.
This paper is intended to discuss and analyze where personal responsibility ends and corporate responsibility begin especially in food and drink sector.
Corporate responsibility, also known as corporate social responsibility (CRS) can be defined as an organization self-regulation. Social responsibility policy ensures organizations comply with the rule of law and moral standards as well as global standards. CRS policy necessitates organizations’ to embrace responsibility for their actions for this result to positive impact to the environment, consumers, employees and society as a whole (Beauchamp & Bowie, 1996). The aspect of public interest is well included in the corporate decision making process. Personal responsibility on the other hand requires one to be responsible for his actions and accept consequences that come later after his actions. In corporate social responsibility there are five core values that must be adhered to which are kindness, integrity, equality, esteem and responsibility.
Kindness is whereby the company shares the success it has achieved while business with the less advantaged in the society and this is done through company involvement in the community using the seven Ps which are People, Premises, Product, Promotions, Purchasing, Power, and Profit.
Integrity is where the company should show transparency in its transactions with stakeholders, both internal and external. Equality; this entails how an organization treats its employees in regard to their health and social welfare. This should not be limited to health and safety only but also in working relationship and life balance as well as providing opportunities for learning and improvement.
Esteem; besides tolerance, the company should promote and embrace work place diversity through respecting employees and their views, regardless of gender and race.
Responsibility; company should recognize the significance of its continuous development process and that it is entitled to shoulder the responsibility of its impact to the environment.
It is paramount and fundamental that companies recognize matters of social importance and address them accordingly and responsibly. It has been found out that companies and corporations that undertake social responsibility earn reputations of being good corporate citizens thus they enjoy diverse benefits like: acquiring and retaining satisfied customers, attracting capital, and recruiting and retaining talented manpower. Identifying and developing corporate social responsibility policies and strategies takes time and requires commitment by companies (Beauchamp & Bowie, 1996). This task is always arduous as dissimilar issues are important and relevant to different stakeholders of the company including social, economic and environmental. With regard to this, there are five faces of corporate responsibility and these include, defensive, compliant, managerial, strategic, and civil.
Defensive stage is where companies are initially condemn because of a problem or an issue and are prompted to take defensive position in legal perspective. For instance they deny accusations of any misconduct leveled on them thereby refusing to admit responsibility of their mess by arguing that addressing or fixing the problem is not their job. Citing McDonald’s company as an example, in 2002 a SuperSize Me documentary demonstrated that McDonald’s food products, burgers and fries cause weight gain. In response to this, the public consequently associated the rising obesity rates in US with a high content of fat in fast foods. That year, people with obesity filed legal suits against the McDonald Company because of their products being with high fat content thus causing obesity. The company’s response to the public outcry was defensive and in fact went a head and disclosed nutritional information about its foods. Some managers argued that the company offers a variety of healthy options and it is up to an individual to eat responsibly.
Compliant stage is a point where companies formulate and implement policies that put into consideration the interest of the public. Thus they are forced to act according to the demands of their critics. The aim of this measure taken is safeguard their brands and reputation from the risk of litigation. However, with continued public outcry about McDonald’s in 2004, the company feared that the criticism would escalate and tarnish the company’s reputation (Horrigan, 2009). The company was forced to move from a defensive stance to a compliant stage. The company accepted the public verdict and went ahead to eliminate from the production process its super-size brand.
Managerial stage is when the problems become eminent and it is clear that it will hardly disappear quickly; companies accept and therefore are told to shoulder the responsibility. This prompts companies to search for lasting solutions to the problem. The continued public denunciation cost McDonald its customers and this caused it to lose profits. This forced the company to up with new strategies that would bring back the lost customers. One of the strategies they came up with was a healthier menu. McDonald decided to concentrate in salads and went ahead to introduce an improved premium salads that was completely dressed with Newman’s own salad. In addition, the company improved the Happy Meal by allowing children to replace fries and sodas with apple slices and low-fat milk. To increase public confidence, the company used celebrities to support their Happy Meal product. The company reduced fat content in their Chicken McNuggets product by introducing white meat with McNuggets. These new strategies helped the company revamp itself back to profitability.
Strategic stage is where the company starts reaping the profit for being responsible in their actions. In fact, company comes to discover that responding to public outcry places them at an advantage over their rivals and strengthen long-term success. McDonald’s new strategy proved successful and many of its lost customers returned back and even got more customers. For instance, McDonald’s salads products were highly bought and in fact, they represented 10% of the total sales. At an overall view, the financial situation of the company improved: the sales increased and net sales increased (Horrigan, 2009). To spice up their corporate responsibility, the company initiated a public awareness campaign which had the slogan “It’s what I eat and what I do ……. I’m lovin’ it.” In essence the company showed concern in healthy matters of its stakeholders particularly the customers, whom they encouraged to participate in physical fitness.
In the civil stage, companies come to view the significance of other companies in the industry to emulate what they are doing. This can be through lobbying other players involved in the industry to support the idea that the public can fully be served through collective action. Nonetheless, McDonalds is yet to advance to this stage; the company has been unable to lobby support from other stakeholders in the fast-food industry in fostering that both grown-ups and children should eat balanced diets. Currently it is not discernable if McDonald Company will be able to achieve this status, or even stick with its healthier lifestyle themes.
In actually sense it is difficult to draw the line between corporate and personal responsibility especially in food and drinks sector. It is indeed a big challenge in life; for example alcohol companies urging drinkers to drink responsibly while at the same time aim at making profits in order to sustain their business. Low sales of alcohol drinks put a company into a bad state, as it will not be able to make profits. Nevertheless, some governments across the globe have developed rules that place the line of responsibility near to the corporations, making them to be more responsible in solving these challenges notwithstanding the crucial role that other stakeholders play. In this case, one is faced with the question as to whether McDonald’s should be held responsible for what an individual eats. Partially, the answer to this is yes, simply because companies must play constructive and proactive roles in addressing relevant issues. On the other hand we can say no, because we can not solve a problem by blaming the company and still we expect them to act unilaterally (Karnani, 2010).
Problems arising form the foods and drinks sector are always systemic and require a deep understanding of their root causes before engaging in coming up with solutions. For instance, alcohol manufacturers coming up with policies that urge drinkers to drink responsibly will not work in the long run, because the drinkers will not pay attention. For this matter, we need to better understand why people destruct themselves and come up with intervention measures that will address the root causes of the problems.
In foods and drinks sector where profits and social welfare is in jeopardy, personal responsibility does not help but rather corporate social responsibility takes precedence to alleviate the situation. Most fast food outlets have expanded and increased their profits by expanding their offerings including salads and other food options designed to appeal to health-conscious consumers. In the same industry, other companies have continued to increase their revenues by producing low fat, whole grain and other foods growing in popularity. It is therefore important to spread the responsibility around especially in the food and drink sector thereby stopping expectation that one actor should take the responsibility for a problem. This will only be possible by bringing together all stakeholders to salvage the problem. For instance, the initiative of PepsiCo, of shifting to a healthier product portfolio, improving its market portfolio, it entered into partnership with Health Weight Commitment Foundation. This partnership greatly helped PepsiCo and citizens at large. Corporations and persons need to be accountable for their actions should always engage in telling the truth all the time. In a corporation’s setting, telling the truth or being accountable entails preparing and producing a report which clearly states what the company has done; be it good or bad and what it takes responsibility for. Such a report should be that which is acceptable by the company’s stakeholders, people who directly have influence to the company.
Personal accountability is like taking cure (therapy) whereby the main goal is to honestly and truthfully talk about self to the therapist. In essence it is just taking individual responsibility and being able to associate or link that to others. Personal accountability or responsibility is like self governance as well as understanding the impact you have on others and acting according to their needs as well as your own (Karnani, 2010). On the other hand for companies, self-governance entails knowing impacts on social, economic, and environmental aspects and managing these aspects in a balanced way taking into consideration the needs of all stakeholders, especially the most disadvantaged.
In order to accomplish the above stated conditions, ethics takes center stage both personal as well as corporate. Most corporations across the globe have established codes of ethics that are meant for governing the behaviors of their employees. Employees are called upon to follow codes of correct behavior while undertaking their duties at the company. It is common knowledge that corporations are out to ensure profit as well as performance. It is therefore imperative for corporations to grasp that for social business performance there must be ethical approach, principle as well as consequence. In relation to this, it is important to incorporate ethics and morality within the structure of a corporation. It is significant that social corporate responsibility exist within every corporation’s infrastructure (Kotler and Lee, 2005). In addition, morals, business and community should work harmoniously to ensure each and every stakeholder benefits from the corporation; without this, the purpose of their existence is null and void. Immoral behaviors and practices bring about a scorned atmosphere that breeds mistrust, and thus making consumers to have bad motives towards the corporation and its products at large. Business ethics are essential and crucial factors in any successful corporation (Shaw and Barry, 2001).
To maintain a moral and conscious outlook in a corporation, an individual should ask himself the following questions to determine whether a particular action he undertakes is morally acceptable: what entails ethical concern? Whether if he is true to himself? What is that is bothering him? Whether if it is his problem? What do other people think of him? Whether if someone else matters? And whether the decision will cause harm to others? These are some of the personal responsibility that one must undertake before making any decision in a company. This guarantees an individual, of no legal action that can be taken against him in case other company stakeholders are harmed or injured.
In order to establish rational ethical guidelines, there is need for the involvement of the management who would ensure appropriate corporate social responsibility. This is because the management is viewed to be the primary source of company policies. For instance when coming up with such guidelines, the management should take into account the following questions: is whether if the decision to be made is for the interest of the company or for personal gain? Whether if it will come a time when an individual interest will surpass that of the masses? The number of individuals expected to gain from the individual interest at the expense of the masses? As we have seen there are many ethical questions posed throughout corporations and social worlds and if right answers are acted upon then there could be no problems between the business and the social sector at large (Kotler and Lee, 2005).
Ethical problems emanating from decisions made by an individual and public have been with us since time immemorial and these have prompted the need to undertake ethical reflections before making any decision. It is conventional that ethical decision go together with good business decision nevertheless, in most cases this concept is not always followed. Acting ethically is argued to be the basis on which good business practices are founded, and it represents the moral perspective though with a universal theme, it is still interpretational. In relation to this it is true to say that, best practices are key functions of professional institutions and therefore it is crucial to train and monitor standards (Lenssen, 2006).
It is an obvious fact that individuals reserve their own self evaluation regarding to their moral actions. This simply means, personality and morals defines an individual or society. Individuals have build-in ethical responses, for instance, they can identify if certain actions are wrong or morally commendable. Values which incorporate sincerity, compassion and fairness are important for the continuous existence of mankind on this earth. A person must be responsible for his own actions with regard to the existing ethics principles that are universally available.
Accordingly, without fundamental standards of reasonable transactions and mutual respect, corporations can not thrive in any society. Therefore, establishing and maintaining an ethical culture within corporations is crucial for continued profitability and success for any corporation. Companies should have polices that provide reminders to their employees for consistent cultivation and improvement of moral judgment as well as specific code of ethics as a conduit of propagating positive image of the organization.
The primary essentials of such cultivation, entails possessing simplicity that is reinforced by traditions that incorporate suitable and relevant conformity to the hard scenarios and management participation and awareness of ethics issues as well as mentoring agendas that are holistically endorsed by top level management and necessitates employees’ involvement. Hence, any decision made by an employee will be both for the public and company good.
The purpose of social corporate responsibility is to determine the values of the businesses to the society. Since human beings must live together harmoniously, there is necessity of deliberations regarding business ethics and society values at large. Lack of this leads to absence of tolerance and less respect for individual life. It is noteworthy that people should adhere to ethical code that ensures appropriate amongst global citizens. Defining moral is basically defining man’s appropriate behavior and interests, an idea that must live within the jurisdiction of business infrastructures (Lenssen, 2006).
In a nutshell, personal responsibility in foods and drinks sector ends when a company’s production activities affect a good number of people in the society. This will mark the beginning of the company’s responsibility for its actions. It is paramount and fundamental that companies recognize matters of social importance and address them accordingly and responsibly. To be more specific, in foods and drinks sector where profits and social welfare is in jeopardy, personal responsibility does not help but rather corporate social responsibility takes precedence to alleviate the situation. The formation of rational ethical guideline regarding to the way a company conducts itself with respect to corporate responsibility must be carried out by top level management. This is important in ensuring that companies get to be more accountable to their action rather than just being responsible. Governmental and international social corporate rules and regulations should come into play to ensure that social issues affecting the society are distinctively addressed.
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