CSR or Corporate Social Responsibility is a significant part of business organizations today. With the increasing concern over the climate and social issues the companies around the world is taking CSR as a very serious component for the success and future prosperity. With the recent media development on the issues of CSR faced by the company,’ Brico Devices’, it is important for it to evaluate and determine those issues and develop suitable solution for the future improvement and sustenance.
The newly emerged negative coverage on the CSR activities of Brico Devices has bought forth immense damage to its brand. It has been alleged that the company failed to provide healthy and good working condition for the workers, low pay rates, indulging in activities that environmentally non-sustainable and even disposal of waste in unsafe manner. Keller et al (2011) assert that it is important to for the company to have a strong brand, since it is through the brand equity a business retains and attracts the customers.
Lindgreen and Swaen (2010) defines CSR aka Corporate Social Responsibility as a process of initiation and responsibilities developed and followed by the companies and other related regulatory bodies for the social and environmental wellbeing. The authors also pointed out that the correlation between a company’s CSR and ‘Brand Equity’ is high, since one of the factors would affect the other.
- To assess and understand Corporate Social Responsibility and its importance for the modern firms
- To conduct a CSR audit
- To synthesize recommendation according to the audit conducted
In order to acquire the aim of the research, the following methods are followed;
- Assess and understand the meaning of CSR and its importance for the business, through several secondary sources.
- Conduct a survey within the workforce of the company in order to understand the issues more profoundly
- Synthesize recommendation after understanding the issues found through the audit
As discussed in the introductory part of this report, the CSR is a firm’s initiative to take responsibility for the social and environmental well being. Tai and Chuang (2014) have signified that the CSR activities or the responsibilities are not only developed through a mere company perception over the social and environmental responsibility that have to be initiated, but there is also a dire necessity to consider the regulatory clauses put forth by the governmental bodies and the data provided by the verified environmental protection groups.
In the current times consumers are not only concerned about the quality of the product they buy, but also the company’s production aspect as well. As Suliman et al (2016) have posited that the modern consumers are not only satisfied with the product quality, but they are also highly concerned over the company’s responsibility over the social and environmental causes. They also posits that seven out of ten consumers today are concerned more on the moral responsibility of the brand or the company they are loyal to, than the product itself. For example, the allegation on the company Nestle over the ‘child slavery’ in Thailand and coco-fields of Africa have bought down 18.7% of the global revenue (Kelly, 2017).
In the current business world, Corporate Social Responsibility has become a pivotal standard of practice. The CSR has often become a firm’s commitment towards the social and environmental responsibility, which in turn improves the company reputation and brand equity. On the other side, Lindgreen and Swaen (2010) asserts that CSR is one of the most ‘significant strategy’ when it comes to competitiveness; and in order for the company to be successful, developing CSR is not only mere necessity rather crucial, hence it is important for the company to integrate the aspects such as policies and processes, which constitute to the environmental, social, ethical and even consumer rights to become prominent player in the industry.
Following are few of the importance of CSR, according to Frederick (2008):
- The concept itself would provide the opportunity for the company and its various workforces to contribute to the society and the environment
- CSR helps the organization in creating and building a positive image that would directly as well indirectly contributes towards its business.
- CSR would also help in create positive and healthy environment for the employees within the organization, which then results in the productive indulgence of them for the acquisition of company goals.
After the thorough investigation in to the various departments of the company, various issues have been found that would directly or indirectly affect the employees’ health and wellbeing. It has been found that in the ‘cartridge section’ there is an immense forming of fiber dust particles, which is harmful for the health of the employees in that department. At the same time, it has also been discovered that there are no protective mask and measures provided for the employees in that department while working, and also the majority of the ventilation system are faulty. The same issue has been found in the welding section, where most of the employees are working without proper or sometimes with dysfunctional working and protective equipments, which would put the health of the employees at danger.
3.2. Low Pay Rates:
It has been found that the employees are receiving payments below the minimum allotted by the government rule. Another significant finding is that many of the employees’ promised bonuses and penalties is at stake, and the complaints dropped regarding this by the employee communities has not been discussed or considered by the respective department or even passed to the higher management till now. This failure from the company’s part is causing many of the trained and skilled employees to leave the company, hence increasing the employee turnover rate for the past five months. Another finding is that the employees who left the company is opening up on the internal issues the company facing in the area of work condition and payment issues towards the general public.
3.3. Environmentally Unsustainable Practices:
The company has failed to synthesize an efficient energy management system and policy. For this reason many of the sections or the departments within the company is overusing electricity, which way above the allotted slot. The company is still using a diesel powered electricity generator for its energy backup, which is emitting a considerable amount of greenhouse gas into the environment. Many of the operational and production areas are still using plastics and other non-degradable materials, which are considered harmful for the environment. Currently the company’s environmental and waste disposal policy is outdated, which is the main reason for the recent issues to get more serious.
3.3. Issues in the Waste Disposal:
As discussed in the ‘poor working condition’ section, the cartridge production section is immensely creating fiber dust particles, and due to the faulty ventilation system most of the dust are removed manually and dumped into the nearby localities. There is a high chance that these fiber-dust particles would be carried by the wind towards the nearby streets and residential areas, which would create health issues for the people living around. Most of the employees are failing to follow the waste disposal method mentioned in the packages of these fiber materials, and this mainly because there has been no attempt from the management to educate these employees in these areas. Also as discussed in the ‘environmentally unsustainable practice’ section the company is highly utilizing non-degradable materials for the production and personal usage of the workforce, which then again is not properly disposed by the company.
After the thorough investigation it has been found that the company has several issues concerning CSR, which is then getting affected negatively over its name and the brand itself. The issues includes,
- Absence of proper protection and faulty ventilation system, which is causing unhealthy work environment for the workforce.
- Dysfunctional and absence of protective equipments in the wielding section, which increases the risk of accidents and mishaps
- Employees are underpaid amidst of the government rule of minimum wage.
- Employee complaints regarding their payment have not been discussed or met with appropriate solution
- Increasing employee turnover due to the failure of management to come with effective solution for the pertaining employee-issues.
- Ex-employees are spreading about the poor work condition and the payment issues of the company with the general public, which then causing the company’s name and brand to get degraded.
- Absence of an effective and efficient energy management system, and also high usage of fossil fuel and non-degradable materials.
- Poor waste disposable policies and process
The following recommendations are put forth for the company after assessing the findings:
- The company should equip more protective equipments for the employees in all the concerning departments.
- All the faulty ventilation system should be repaired or replaced
- The management should consider in restructuring the entire payment system, and should release the pending bonuses and other remunerations for the respective employees
- All the complaints asserted by the employees should be tabled and discussed, in order to develop suitable solutions
- An efficient energy management system and environmental policy should be developed, and through this the usage of fossil fuel and non-degradable materials should be decreased or even eliminated if possible.
- An updated waste-disposal policy should be synthesized in order for the effective disposal of the fiber and non-degradable waste materials.
Keller, K.L., Parameswaran, M.G. and Jacob, I., 2011. Strategic brand management: Building, measuring, and managing brand equity. Pearson Education India.
Kelly, A. (2016). Nestlé admits slavery in Thailand while fighting child labour lawsuit in Ivory Coast. [online] the Guardian. Available at: https://www.theguardian.com/sustainable-business/2016/feb/03/nestle-slavery-thailand-fighting-child-labour-lawsuit [Accessed 13 Jul. 2017].
Lindgreen, A. and Swaen, V., 2010. Corporate social responsibility. International Journal of Management Reviews, 12(1), pp.1-7.
Suliman, A. M., Al-Khatib, H. T., & Thomas, S. E. (2016). Corporate Social Responsibility. Corporate Social Performance: Reflecting on the Past and Investing in the Future, 15.
Tai, F.M. and Chuang, S.H., 2014. Corporate social responsibility. Ibusiness, 6(03), p.117.
