Corporate Social Responsibility in the Alcohol Industry - Case Study Example

Corporate Social Responsibility in the Alcohol Industry (Student’s Name) Foundation Course- Tutor: (Instructor’s Name) Institution’s Name Department Date Introduction In the modern societal setting, business competition has revolved immensely. Businesses seek to edge out competitors using the best available chance. To some extent, the business rivalry has restored sanity in the provision of quality and services. The consumer and the society reap immense benefits from the efficiency and effectiveness of business operations emanating from competition. In the onset of the 19th century, business leaders decided to reward surrounding society members by availing a portion of net profit (Corporate Social Responsibility 2013). This is because business benefit mutually from the surrounding community through reliance on raw materials, labor and other natural resources. By rewarding the surrounding community, businesses sought to undertake a responsibility on the society. This concept has changed and evolved seeking to comply with the prevalent dynamics in the business sector. Scholars and economists refer to the concept of rewarding a surrounding community with share of net profit as corporate social responsibility. Corporate social responsibility is a new concept based on an old idea. Modern businesses seek to entrench this concept as it affects their operations, productivity, and profitability. Corporate social responsibility is now a mandatory business operation that has revolutionized to adapt to the prevalent societal intricacies. It is common for business top run schools, hospitals and provides other social amenities to the surrounding environ. Corporate social responsibility started as a minor endeavor to appreciate the efforts of communities hosting businesses, institutions or other enterprises. With the passage of time, corporate social responsibility has revolutionized to a competitive strategy where businesses engage in the practice seeking to lure additional customers. Additionally, consumers adorn business practices that offer corporate social responsibility due to develop school of thought that businesses availing societal support has social well fare (Wan-Jan, 2006). Corporate social responsibility is a public image development strategy where businesses seek to campaign and garner worthy affection. The government offers subsidies to corporate social responsibility providers because they indulge in providence of social amenities. According to legal stipulations, the government bears the mandate to offer social amenities, providence of affordable healthcare and education, as well as environmental conservation. Since the corporate sector decided to take an aggressive role in the providence of these prerequisites, the government sought to subsidize their business operations. In essence, the corporate bodies use corporate social responsibility as an edge to lure customers while attaining subsidies from the government. Corporate social responsibility is an admirable feature that depicts humanitarian efforts to alleviate communities. In most instances, neighboring communities face multiple afflictions from the induction of an organization in their neighborhoods. For instance, with the prevalent population growth and development, it is increasingly difficult to locate a premise that can fully accommodate a sizeable corporate body (Garriga & Mela 2004). To meet selfish desires, organizations bribe council legislators who in turn evict legally entitled residents compensating them inappropriately. This trend resonates to extreme societal sufferings as the evictions are unjust and unwarranted. Additionally, employees and neighbors to organizations have engaged management on legal tussles for health concerns over pollution. Some organizations emit harmful waste that is injurious to humanity. The scores of men who perish and languish in impoverished health status get abusive compensation that cannot restore the initial status quo. This affirms that organizations are deeply indebted to the societies that sustain their growth and development. Corporate social responsibility at some point should be a legal stipulation as organizations dearly owe a duty of care to society members. Organizations face a dire challenge when trying to measure or evaluate the assistance and aid emanating from surrounding communities. To some extent, corporate bodies seek glorification while the society languishes with a myriad of challenges emanating from the initial setup (Kreng & Huang 2011). Corruption and other societal evils emanate from the fact that, corporate bodies entrench such behaviors to a modest society or community. After some time, the ill behavior becomes a norm leading to mass poverty and social disintegration. These challenges are deeply rooted into a previously sanctified society who pays dearly for the initial setup allowance. Corporate social responsibility cannot account for such a heinous act indicating that organizations inadequately compensate surrounding communities. Corporate social responsibility traverses all economic sectors seeking to ensure that all corporate bodies indulge in these humanitarian activities. The alcoholic producing fraternity has developed and thrived beyond previous economic projection (BMC Public Health, 2013). Alcohol arouses arguable controversy with opponent contending that it is a societal vice deserving banishment. Proponents to its enactment indicate that alcohol consumption is a choice guided by free will. Regardless of this debate, alcohol continues to disintegrate societal values, causing innumerable deaths, devastation and interferes with inherent fabrics to society. The consumption of alcohol is under the government’s regulation seeking to ensure that social values do not go down the drain. In the modernized era, alcohol production has revolutionized taking an evident paradigm shift. Technological advancements have ensured that alcohol production is as efficient and effective as possible. This implies that the production of alcohol has mechanized seeking to avert the dangerous traditional methods utilized in the past (Tan, 2009). Additionally, as scholars and economists opine, any economic sector that has abnormal profit returns attracts numerous investors. In the end, the additional investors share the available market reducing the profits considerably to healthy profits. In the same way, the alcohol production industry continually attracts new competitors who seek to dissect the available market share and garner a portion of the rewards. Currently, the alcohol producers have increased significantly with the production techniques traded on the global platform. Each of the producers seeks to attain global market shares reaping billions of dollars in terms of returns. To achieve these objectives, companies dealing in alcohol production, distribution and delivery have sought to undertake aggressive marketing exploiting all viable promotion and public relations avenues. Corporate social responsibility seems to be a lucrative avenue where alcohol-producing corporations seek to woo potential clients. Alcohol production and consumption in society arouses controversial debates as to whether it interferes with the intended social setting. In the alcohol sector, companies are faced with a myriad of challenges seeking to accomplish their objectives. The intent of corporate social responsibility is to reward society stakeholders on their effort towards the attainment of organizational objectives. In essence, corporate social responsibility seeks to provide a platform for organizations to share their rewards with external stakeholders. In seeking to accomplish this objective, the alcohol sector faces innumerable challenges from conservative groups, religious leaders and other society members (Grant, 2005). Alcohols harm to the societal fabric is the first inalienable problem facing the alcohol sector when executing the corporate social responsibility mandate. Since time immemorial, alcohol results to bodily injuries harming essential organs like the liver. The partakers of this beverage whether illicit or legally accepted face critical health concerns in the future. In trying to avoid the blame game chain of command, the alcohol producers notify members of the public and their clients regarding the effect of heavy consumption or reliance to the product. As modernization takes root, financial problems are a common phenomenon in many organizational settings. Financial constraints pave the way for the creation of shortcuts to avail easy funds. The alcohol producers engage in contraband manufacturing using illicit ingredients causing faster joy and sorrow all in equal measures. Additionally, the alcohol production process causes the emission of harmful and poisonous gases (Boeger, Murray & Villiers 2008). The Greenhouse gas emissions Act targets alcohol producers seeking to curtail their endeavors as their cause irreparable damage to the environment. Similarly, the waste released by these companies cause negative inflictions to the neighboring communities. Since time immemorial, court proceedings have sought to determine alcohol related suits. Some suits emanate from the fact that, continuous reliance on the illicit brew leads to death. The families of the bereaved seek legal redress claiming that the contents of the drink caused death. Other complainants indicate that the pollutants cause health complications and seek compensations. Many alcohol-producing companies face litigation suits by their workforce claiming that the gases emitted cause health problems. These cases are extremely common in the alcohol production sector curtailing cordial relations between management and the surrounding society. Many societal members uphold that the religious doctrines in their perceived controversy unanimously condemn alcohol production. The International Center for Alcohol Policies (ICAP) has for a long time spearheaded aggressive campaigns seeking to clarify certain critical issues (Jenkins 2005). First, critics have it that though the Alcohol producing companies have a legal duty of care to meet the needs of stakeholders, by engaging in corporate social responsibility, these companies engage in blame shifts. It is irrefutable that though the consumption of the drink leads to enjoyment, and economic benefits, there are immeasurable and devastating issues allied to alcohol consumption. The producers of the beverage use corporate social responsibility as a platform to transfer the blame consumers of the beverage. Once alcohol-producing agents have adequate media attention, they target their devastation and litigation obligations to the consumer citing irresponsible consumption. Each industry has to face off with the prevalent drawbacks related from production and consumption of its commodities. The alcohol companies all the entire stakeholders’ fraternity a worthy explanation and division of returns. To evade this demanding responsibility, the alcohol producing agents use the corporate social responsibility forum to avenge blames neglecting the initial mandate. Alcohol producers fail to meet the stipulated targets of indemnifying society members who suffer either from consuming, working, or neighboring production plants. Corporate social responsibility seeks to ensure that returns from trading or the core objective of a business reach all stakeholders. In the event that the practice or product is injurious, the consumer has the mandate to pay off the inflicted client, employee, or member of society (Integrity in Corporate Activities, 2013). In totality, the alcohol sector faces a myriad of problems during the providence of corporate social responsibility. Since these companies are deeply indebted to their stakeholders, they avail inconsequential corporate social responsibility services that do not level the harm inflicted by their products. Environmental sustainability, communal welfare and consumption responsibilities underpin the challenges facing alcohol producing companies as they undertake their corporate social responsibility mandates. Foster’s group is an Australian based company with brewing and soft drink interests. Headquartered in Melbourne Victoria, Foster group is a subsidiary to SAB miller a Britain based Multinational Corporation. Founded in the late 1880s, Foster’s group has domineered the Australian beer market for a long period. Foster’s group shares traded on the Australian stock exchange but halted after its acquisition by the British based conglomerate in 2011. As the other company of its status and financial muscle, Foster’s group engages in sustainable activities seeking to accomplish its corporate social responsibility. The company has a close commitment to its stakeholders and clients seeking to minimize the rate of injury. A conclusive report filled in 2011 on Injury frequency rate affirmed that there were no permanent disabling ailments over that year. Additionally, Foster’s group seeks to mitigate the emission of greenhouse gases produced during the manufacturing process (Sustainability 2013). In one of the breweries, Foster’s group upgraded the boiler enhancing the conversion of natural gas and consequently reduced the emission rate by 50 percent. In the energy sector, Foster’s group increased on water efficiency and overall energy consumption efficient of 5.3 percent against a 10 percent target.Towards a sustainable corporate social responsibility program, Foster’s group has raised a $7.1 million dollar kitty to finance issuance of grants and other humanitarian activities. These kitty finances school initiatives, healthcare providence amongst other social amenities to the needy in society. Additionally, Foster’s group undertakes a conclusive educational program on responsible consumption. Right from the promotion activities, Foster’s group highlights the need for responsible alcohol consumption. In the logos and other advertising materials, Foster’s group clearly indicates the need for responsible consumption enlightening the Australian populace of dire consequences if responsibility is absent. Fosters group adopts a strategy to shift any blame related to excessive consumption of alcohol. The consumption of alcohol regardless of the amount has negative body related effects. There is no consolation as to the damage caused because of the level of consumption. Both consumers suffer similar effects in the end (Responsible Consumption 2013). The use of positive publicity is a technique adored by alcohol producing organizations as they seek for solace. Australia accommodates numerous alcohol-producing powerhouses. Lion is a food and beverage company operating in both Australia and New Zealand. Lion Nathan National Foods is the official name of the merger between Mitsubishi group, which purchased Lion Nathan then merged with national foods in 2012. The company is home to 1400 New Zealand employees and 6000 Australians. With immense predominance in the food sector, the company appears in both the New Zealand and Australians stock exchanges. Lion’s most lucrative product, the XXXX Gold, is the largest beer brand in Australia. The success story replicates in the Australian market where the beer has amassed a sizable market share introducing stiff competition into new soils. In terms of corporate social responsibility, lion has a number of strategies. The first strategy entails encompassing alcohol with other food products. This way, lion as a company is not answerable to the harm emanating from consumption of the product. Lion is a business magnate that produces numerous food products while pursuing brewing activities. It is easy for such a company to create a shadow effect where corporate social responsibility activities focus on other foodstuffs (AU Beer Lion, 2013). Alcohol consumption fails to capture the center stage as lion produces a variety of commodities most of which do not harm individuals. With this strategy, the company does not issue a red alert on consumption regularities. Since alcohol is an insignificant section of the production kitty, Lion does not issue a stern warning on the consumption levels and any negative consequences. In trying to conform to environmental standards, Lion follows the stipulations of the global reporting initiative. The global reporting initiative is an organization that seeks to enhance economic sustainability. Through these policies, lion avails corporate social responsibility reporting and environmental social governance reporting. Without a doubt, this viable framework guides organization to undertake diligent mandate to not only preserve the surrounding but also give back to society. Lion conforms to the Australian carbon dioxide framework seeking to ensure that greenhouse gases do not interfere with the prevalent climatic conditions through global warming. Many corporations opine that corporate social responsibility activities relate to issuing grants and financial assistance to the destitute in society. Similarly, Lion has a stable financial kitty set up to fund humanitarian initiatives in the surrounding environment. The company seeks to provide financial assistance to the needy in Australia and New Zealand. Similar to Foster’s group, lion fails to address the main challenge ailing the alcohol producing and retailing companies. This is because Lion’s corporate social responsibility program does not offer a solution to ailing Australians and New Zealanders suffering from impoverished health (McWilliams & Siegel 2000). Both companies use different strategies but aim at similar objectives. The debate on whether alcohol in itself is a societal vice arouses heated debate over different platforms. Protecting detrimental consequences befalling consumers of the drink are retrospective and irresponsible. Organizations lack the capacity to confront the ill tendencies as they are aware of the magnitude alcohol has on impairing the social fabric. It remains irrefutable that the blame game as to who is wrong does not solve the problem. Foster’s group marketing strategy advocating for responsible consumption does not provide the much-desired solutions to an ailing society. Similarly, Lions sugarcoating activities and coupling up the entire production list in a single marketing basket does not address the salient issue. These strategies fail to address the core objective and intention behind corporate social responsibility. Though the companies operate voluminous well-funded financial kitties, the much ailing society continues to flock in the corridors of justice seeking for legal redress. Competition continues to disintegrate humanity values as corporation’s desire increased returns. Foster’s group and Lion share striking resemblance concerning the corporate social responsibility problem (CSR & sustainability info for Foster's Group Limited, 2013). Neither of the two companies is ready to pay for the consequences of the products manufactured. They utilize shadowy tactics to confuse clients and other stakeholders that the production cycle is healthy and sanctifies. With advanced competition and heinous business antics taking center stage to avail financial advantage, companies in the alcohol industry show little or no concern over the languishing clients. The fact that clients engage in the consumption of alcohol for relaxation is an unwarranted excuse. Both lion and Foster’s group complies with salient stipulations on corporate social responsibility and environmental preservation. Both of the companies conserve the environment as they seek to benefit surrounding communities. This is because Lion engages in the global reporting initiative while Foster’s group has a unique system of checks and balances. This implies that, the two companies seek to engage in environmental preservation a significant element in modern times. Further environmental degradation warrants dire consequences not only to the surrounding community but also to the organization. The striking challenge facing both companies emanates from the industrial setting. Alcohol as a product results to joy and sadness in equal measures. It is increasingly difficult for organizations to pursue corporate social responsibility while their core product causes social disintegration amongst other vices (LVMH versus Diageo, 2013). This challenge faces vehement reinforcement from conservationists and other humanitarian groups who water down the efforts of alcohol producing companies. According to critics, any effort to undertake corporate social responsibility emanating from the alcohol producing companies is a blame shifting technique. This hinders the achievement of sustainable corporate social responsibility efforts. Conclusion In conclusion, corporate social responsibility is a vital task requiring conclusive redress. Modern companies have to adorn corporate social responsibility for them to thrive and succeed amidst stiff competition. In the alcohol industry, corporate social responsibility poses a dire challenge. The main reason is because, alcohol inflicts through social damage causing unwarranted disintegration. Social members raise up in arms seeking legal redress for their relatives or friends who languish in mass poverty or suffer chronicle illnesses. With adequate marketing awareness and issuance of grants to the afflicted societal members, the alcohol-producing agents offer no remorse to the plight of those suffering. It is inconsequential of the amount consumed because even little alcohol consumption causes slow tissue wear and tear. In eventuality, alcohol companies have to answer to numerous claims of damage infliction and social disintegration. This challenge requires timely redress seeking to ensure that the issue does not arise into the future. References AU Beer | Lion. (n.d.). Lion. Retrieved October 6, 2013, from http://lionco.com/brands/beer-spirits-wine/australian-beer/ BMC Public Health | The illusion of righteousness: corporate social responsibility practices of the alcohol industry. (n.d.). BioMed Central | The Open Access Publisher. 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