Coca-Cola Amatils CSR Strategy: Focus on Community-Related Initiatives - Case Study Example

Coca-Cola Amatil’s CSR Strategy: Focus on Community-related Initiatives Introduction This report is about Coca-Cola Amatil’s corporate social responsibility (CSR) strategy. Coca-Cola Amatil is a bottling company licensed by the Coca-Cola Company to operate in the Asia Pacific region (CSRHub 2016). The company has operations in five countries, namely New Zealand, Australia, Indonesia, Papua New Guinea and Fiji (CSRHub 2016). The specific focus of the report is on how the company engages the community through its CSR activities. The report will analyse the various activities that Coca-Cola Amatil undertakes which are focused on the interest of the community and how the company ensures that the community is involved in the CSR activities. As part of the analysis, comparisons will be made between Coca-Cola Amatil’s strategy and other companies’ approaches to engaging the community through CSR activities. The analysis will also involve a discussion on kind of communication that the company is involved in with the community that is the target of its CSR activities. As well, the report will discuss how Coca-Cola Amatil’s activities and communication processes are organised to ensure that its CSR initiatives targeting the community are successful. The relationship management theory will be used to illustrate how Coca-Cola Amatil interacts with the communities that it targets through its various CSR activities. Coca-Cola Amatil’s CSR Strategy CSR is defined by the World Business Council for Sustainable Development (WBCSD) (cited by Amin and Zhang 2013, p. 73) as the continuing commitment by businesses to behave in an ethical manner and making a contribution to economic development and at the same time improving the quality of life of the business’s workforce and members of their families as well as that of the local people and the wider society. Another definition of CSR as provided by the WBCSD is that CSR is an organisation’s “commitment to contribute to sustainable economic development, work with employees, their families, the local community and the society at large to improve the quality of life” (Amin & Zhang 2013, p. 73). This means that organisations that engage in CSR aim to help their employees, their families and the community and society at large in addition to the primary motivation of making profit. This is achieved though various activities or initiatives that target the aforementioned groups. Coca-Cola Amatil’s CSR initiatives Coca-Cola Amatil’s CSR and sustainability programmes are based on four key pillars. These are to sustain and conserve the environment, to provide a wide array of products to the company’s customers, to maintain a good work culture as well as positive values among the company’s employees, and to contribute to the socio-economic development of the communities within which the company operates (Coca-Cola Amatil Indonesia 2016a). With respect to initiatives that target the community, Coca-Cola Amatil partners with communities in the different countries in which it operates in order to “deliver a shared benefit” from its presence in these countries (Coca-Cola Amatil n.d). The various initiatives are as follows. In Australia, the company has funded various charitable organisations and programmes, provided community grants, sponsored sports events from local to international levels, and is also involved in workplace giving Coca-(Cola Amatil n.d). In New Zealand, Coca-Cola Amatil works with communities by investing in programmes targeting wellness, environmental awareness, and inspiring the youth (Coca-Cola Amatil n.d). In Fiji, Coca-Cola Amatil sponsors school games and provides financial support to various sports events including rugby and golf tournaments (Cola Amatil n.d). In Indonesia, Coca-Cola Amatil’s CSR programmes that target the community are aimed at making a contribution to the social development of the communities in locations that the company has operations (Coca-Cola Amatil n.d). These include environment-related activities like tree planting and clean up days, provision of health services; education-related services such as education assistance and workshops; community-wide initiatives such as disaster relief assistance, water assistance and assistance on infrastructure; and providing support in religious activities (Coca-Cola Amatil Indonesia 2016b). In Papua New Guinea, the company is involved in provision of water, promoting economic activity for women, and helping in eradicating diseases such as tuberculosis and malaria. Comparison of Coca-Cola Amatil’s CSR initiatives with initiatives of other organisations Many companies across the world also undertake CSR initiatives that target sustainability in general and communities in particular. For example, Hitachi has a global community and it targets this community through activities and contributions that focus on establishing strong relationships with various stakeholders as well as community organisations (Hitachi 2016). The company offers both volunteer and financial support to not-for-profit organisations. The company also supports contributions to the community at various levels through volunteer work, donations, and its North America Community Action Committees (Hitachi 2016). Another company that is engaged in CSR activities that target the community is BHP Billiton. On its website, BHP Billiton (2016) notes that it believes that it has a “responsibility to make a broader contribution to sustainable development”. The company also notes that it makes voluntary social investments in the communities where it operates and that it also funds the BHP Billiton Foundation, which is a charity that makes investments in global and national projects. Further, according to the company, the investments in CSR are in accordance with a number of the Sustainable Development Goals of the UN, including reducing inequality, providing quality education, and addressing climate change (BHP Billiton 2016). Nature of Coca-Cola Amatil’s communication regarding CSR and the community All organisations do have internal and external stakeholders. Internal stakeholders include people within the organisation such as employees and the management. On the other hand, external stakeholders include people outside the organisation who are affected directly or indirectly by the organisation’s activities. These include customers, the community, the government and others such as the media and civil society groups. Internal communication is communication that happens among internal stakeholders of an organisation while external communication is communication between the organisation and its external stakeholders (Aagaard 2016, p. 91). Since the focus of this report is Coca-Cola Amatil’s CSR initiatives that target the community, there is no doubt that the main form of communication involved is external communication. External communication is the main form of communication being used by Coca-Cola Amatil since the company targets the community with its CSR activities. However, according to Aagaard (2016, p. 91), even as an organisation focuses on external communication for CSR activities, it should not ignore internal communication. This is because too much emphasis on internal communication can create the perception that CSR is a communications approach as opposed to an integral component of the business strategy. As such, Coca-Cola Amatil ensures that its CSR plans are well discussed within the organisation before the community is informed for further debate and suggestion of other appropriate proposals. Identification of publics and stakeholders for Coca-Cola Amatil’s CSR approach Coca-Cola Amatil employs the strategy that is used by the larger Coca-Cola Company to identify the stakeholders who are targeted by a given CSR initiative. The Coca-Cola Company works proactively together with all its external stakeholders, a process that enables the company to identify and address issues that affect the stakeholders (The Coca-Cola Company 2015). This is achieved through the fact that the company brings together experts and people from diverse backgrounds and organisations. These people pool their knowledge to determine the CSR initiatives that can have the most significant impacts for both the company and the targeted stakeholders. The Coca-Cola Company engages different stakeholders in various formal and informal settings throughout the entire company’s system. The engagements range from organising meetings with local, national and regional groups to discussions with the various bottlers that are affiliated to the company, consumers and suppliers (The Coca-Cola Company 2015). Working with local, national and regional groups enables the company to identify the various communities that targeted for CSR activities as well as their needs. The benefit of working with a wide array of stakeholders, communities included, is that this enables a firm to target the main audience groups (Boateng 2014, p. 148). According to Boateng (2014, p. 148), the main audience groups are the opinion leader audience and the general public. The opinion leader audience refers to the groups of people that have the highest likelihood of being critical and proactively seeking out CSR information about the firm in order to create their perceptions, such as the media and CSR experts. On the other hand, the general public does not actively seek out information, but gets access to information through channels such as the media, which in most cases has an effect on their perceptions about the firm. The general public includes members of the local community and consumers. With regard to communities, Coca-Cola holds community meetings, facilitates plant visits, promotes partnerships on common issues, conducts lectures at universities, and sponsors various activities that bring people from the affected communities together. Through such engagements, the company is able to listen to the contributions made by the community and incorporate some of the issues in its CSR activities. By working with communities, the company is able to achieve a greater impact in regard to social, environmental and other issues than would be achievable working alone (The Coca-Cola Company 2015). How Coca-Cola Amatil organises its communication processes to ensure that CSR initiatives targeting the community are successful Coca-Cola Amatil widely engages the community in regard to its CSR activities. Relationship management theory dictates that CSR needs to act as a framework for establishing support networks between an organisation and its stakeholders (Kevin & Bartlett 2009). Some of the methods through which the company communicates to its audience and communities in particular to establish support networks include direct engagements as noted above (through community meetings, plant visits, having partnerships on common issues, conducting lectures at universities, and sponsoring various community-based initiatives). The company also engages people though its annual reports. For instance, its 2015 annual report titled “Real commitment: 2015 sustainability report”, the Coca-Cola president for the South Pacific region noted that water is a top priority for the company, since water is the company’s primary ingredient and is also necessary for growing the agricultural inputs that the company uses (Coca-Cola Amatil Limited 2015, p. 38). The company also noted that “Safe, accessible water is also essential to the health of people and communities, critical to ecosystems and indispensable for economic prosperity—all things our business requires” (Coca-Cola Amatil Limited 2015, p. 38). On the same page of the report, there is a photograph of the company’s employees and a group of people holding bottles of drinking water supposedly provided by the company. The photograph is captioned: “Providing clean water and sanitation” in Bali, Indonesia (Coca-Cola Amatil Limited 2015, p. 38). This shows that provision of clean drinking water to the community is one of the CSR initiatives in which the company is involved. See figure 1. Figure 1: A photograph showing Coca-Cola Amatil staff and members of the community holding bottles of drinking water in Bali, Indonesia. Source: Coca-Cola Amatil Limited (2015, p. 38) What comes out from the communication strategy that Coca-Cola Amatil is using is that the company identifies projects that are not only appropriate for the community but also aligned with the company’s business. This is how most successful CSR initiatives are structured, and as noted by Sundar (2013, p. 333), the idea is to align the firm’s interest with the interest of the community. Also, it can be seen that Coca-Cola Amatil is using different CSR approaches for communities in a different locations. This can be seen from the fact that in Australia, the company focused on initiatives such as funding charitable organisations and programmes, providing community grants and sponsoring sports events while in Indonesia, the company concentrates on providing clean water and other environment-related activities. The concept behind this approach is that in countries that lack sufficient government funding for things such as water (for instance Indonesia), facilitating the provision of water and sanitation services may be far more valuable to the community while in governments with robust provision of services, focusing on other areas such as conservation programmes and sports may be more appropriate (Rangan, Chase & Karim 2015). Conclusion Coca-Cola Amatil’s CSR strategy shows that the company engages a wide array of stakeholders to identify the needs of different stakeholder groups. This report has focused on Coca-Cola Amatil’s relationship with the communities in the areas in which the company operates. The company engages in external communication with these communities through direct interactions via community meetings, plant visits, having partnerships on common issues, university lectures, and sponsorship of various community-based activities. Through relationship management, the company engages communities to ensure that its CSR activities are aligned with its business as well as the communities’ needs. References Aagaard, A 2016, Sustainable business: integrating CSR in business and functions, River Publishers, Gistrup and Delft. Amin, MR & Zhang, Q 2013, ‘Confucius’ teaching and corporate social responsibility’, in J Okpara & SO Idowu (eds), Corporate social responsibility: challenges, opportunities and strategies for 21st century leaders, Springer-Verlag, Berlin, pp. 67-88.’ BHP Billiton 2016, Our contribution, viewed 27 October 2016, . Boateng, SL 2014, Essays from a marketing PhD: year one, Pearl Richards Foundation, Accra. Coca-Cola Amatil Indonesia 2016a, What is CSR & sustainability, viewed 25 October 2016, . Coca-Cola Amatil Indonesia 2016b, Communities, viewed 25 October 2016, . Coca-Cola Amatil Limited 2015, Real commitment: 2015 sustainability report, viewed 28 October 2016, . CSRHub 2016, Coca-Cola Amatil Limited CSR ratings, viewed 28 October 2016, . Hitachi 2016, Corporate social responsibility, . Kevin, J & Bartlett, JL 2009, The strategic value of corporate social responsibility: a relationship management framework for public relations practice, viewed 28 October 2016, . Rangan,VK, Chase, L & Karim, S 2015, The truth about CSR, Harvard Business Review, January-February Issue, viewed 28 October 2016, . Sundar, P 2013, Business and community: the story of corporate social responsibility in India, SAGE, New Delhi. The Coca-Cola Company 2015, Stakeholder engagement, viewed 28 October 2016, . Read More