Corporate Social Responsibility Structures and Website of BMW, General Motors, and Toyota - Case Study Example

Introduction Most businesses are set up to create profits for their owners (Grant, 2005). Entrepreneurs create and maintain business by commercialising innovation (Drucker, 2007). Businesses therefore make money by providing a given solution to the public and then position itself to gain continuous revenue from such an activity. However, businesses are required to operate in a sustainable manner that would enable them to preserve the society and hence remain in business into the future (Barnajee, 2010). The UN Principlies for Responsible Investment urges businesses to have good Environmental, Social and Governance structures that makes it a strategic obligation for organisations to set up and honour very strong ethical positions in their operations (UNPRI, 2011). This therefore requires businesses to have good governance systems that would be responsive to the needs of the individuals and entities affected by the operations of a given company. Each group of these stakeholders should be given ethical treatments and structures. One group of stakeholders that have become very important in recent times is the generation unborn. This makes it imperative for businesses to operate in an environmentally sustainable manner. This paper examines the corporate social responsibility structures and website of three global businesses in the car manufacturing industry namely BMW, General Motors and Toyota. These entities have special reporting systems and structures for their ethics and corporate social responsibilities that are communicated to the public via their websites. Their websites are examined closely for the relationship between their ethical and CSR structures and the stakeholder groups affected by their existence in the wider community. Commonalities The first and striking commonality between the three websites examined for BMW, GM and Toyota is the fact that it presents information that builds on the longstanding traditions of ethics and responsibilities over the history of the business entity. In other words, everything presented is based on past information and this presents all three companies as trying to use their website to present information about the past, present and future ethical and CSR traditions in their operations. Secondly, all three websites represent the interest of their stakeholder groups through their CSR websites. Although there is a variance about the degree to which they do this, each one has at least made a conscious effort to group its stakeholders under different headings and present information relevant to them via the website. Also, all these businesses seem to place a high emphasis on environmental factors and concern. Each of them has disclosed information about their concerns for carbon emissions and efforts to manufacture cards that cut down on carbon emissions. Additionally, each of the websites has disclosed some information about their activities that seek to make the world a better place. This is typically done through charitable foundations, sponsorship drives amongst other things. Although there are variances in the degree to which each website discloses its information, they all seem to cover information relating to how they have helped the wider society over the years. Finally, it appears that the issue of corporate governance is a source of competitive advantage for all these car manufacturers. There is therefore clear evidence that each of the websites report information that is connected directly with top-level management and seem to be a tool for competitive advantage in the automobile industry. In summary, the commonalities I discovered for the websites are their use as a reporting and communication tool by the companies, their stakeholder outlook, environmental elements, social development attributes and the competitive advantage elements. Effectiveness of the Websites SIRAN (2005) states that as part of best practices, the top companies around the world would have to dedicate some space on their website to the dissemination of reports and information about their ethical and corporate social responsibility activities. Waddack (2006) identifies some attributes of a good international CSR website for organization. This includes: 1. Details of past, present and future ethics and CSR activities 2. Sufficient disclosure on ethical, social, environment and governance concerns 3. Interactivity 4. Localization of global concerns The websites of the three global car manufacturers were matched against these yardsticks as well as other practical concerns about the industry to get an idea of whether the sites were attaining their effectiveness objectives or not. BMW Their website states the relationship of the company with other stakeholders in the society using a functional approach. In this quest, they have disclosed the various stakeholders under various headings including sustainability management, economics, product responsibility, environmental activities, employees and societal development roles. This disseminates sufficient information to all stakeholder groups and it gives details of the present and future ethical standards and practices. The main strength of this is that every stakeholder group can easily go to the website and get the information it is interested in quite easily. Another strength of the BMW CSR website is that has a special information delivery page for its customers. This gives the customers an understanding of their responsibilities and encourages them to participate in the CSR and environmental campaigns it is involved in. It also displays explicity, BMWs efforts in making the world a better way by way of research and improvement of existing vehicles to cut their emissions. This puts them in a very favorable position with the wider society. The downside of the BMW website is that it gives very little room for interactivity. A consumer or stakeholder group that comes onto this site is being told what to do and such a stakeholder has little recourse to contribute or ask for a specific action to be completed by BMW. Also, the BMW website is highly centralized. There is little a local pressure group can contribute through the website to the company. It therefore means that the website is not serving its true purpose of acting as an agent of change in partnership with the ordinary member of society. GMC The General Motors website also has very simple systems and structures for disseminating its information. Unlike the other sites, the GM website is not so large and takes a shorter time to be downloaded. This can allow stakeholders with very slow internet systems to access the site anyway. Secondly it discloses direct information about the various stakeholder groups and have links to more detailed explanations on these sites. It also shows the efforts that the company is making in research for the improvement of environmental efficiency in the cars they manufacture. Also, the ethics of GM and its strong history is clearly and succinctly presented by their CSR website. The corporate structure of the company is clearly defined. It links the CSR and ethical systems strongly with the top level management of GM. However, there are numerous efficiency matters with the GM website and how it attains its ends of deploying information about the ethical and CSR matters in the organization. First of all, there is little involvement of the end user of GM vehicles in the CSR system. This does not make them active contributors to the vision of GM. The website is too globalized. It does not focus on local projects and activities. This therefore makes it impossible for users of GM products outside America to have any connection with the company by interacting with them. The website is also closed for dialog and this makes it less effective in fulfilling the reason for which it was set up. Toyota Toyotas website has a structure and presentation system quite distinct from that of GM and BMW. The Toyota website sets out the information about its ethics and CSR in a very practical matter. Upon opening the website, one sees a video of the CEO presenting information about the CSR and ethical systems of the company. It is a 12-minute video which gives a direct link between the company and the wider society in very simple terms. The other navigation keys on the site leads to practical elements of the Toyotas contribution to the society, environment and corporate governance. It explains the project and activities that Toyota has been involved in within these three areas of concern. This gives room for a very high degree of interactivity between Toyota and its various stakeholders. Toyota also has local websites for the regions within which they operate. This enables the company to localize their corporate social responsibility and ethical disclosure through their websites. This enables them to present what they have done so far in a very clear-cut manner. Also, the information is comprehensive and specific. It is straight to the point and allows an ordinary person to get a good understanding of what Toyota is doing in the ares of CSR and ethics. The downside of the Toyota website is that it is quite complicated. There is therefore the chance that people using old models of computers and slow internet would not be able to access their site. On the other hand, there is the issue of the website having too much information that might not be easily analyzed by a layman. This therefore means that the website is not really user-friendly enough for the attainment of a global reach. Conclusion on the Effectiveness of the Websites In relation to CSR and ethics, the websites of these three car manufacturers are being utilized for the dissemination of information. However, the effectiveness of these websites is variable. From the analysis done above, it is evident that the Toyota website is the most effective. This is followed by the BMW website and then the GM website. Although all of them satisfy basic requirements of best practices, some websites are more effective than others. Potential Role of Websites in the Promotion of CSR Potentially, the websites of these car manufacturers can have some positive effects on some groups of stakeholders connected to these global businesses. First of all, websites can be a tool for the disclosure and wide dissemination of their ethics and CSR accomplishments. This can boost their reputation and increase their competitive advantage over their fellow automobile manufacturers. For instance, the Toyota website discloses the global social development that the company has embarked upon like their support for the American Red Cross which is noted for helping people in serious need around the world. This builds up a positive reputation about Toyota as being an agent for social change and development. Secondly, the websites are tools that will open up these companies for interaction with other stakeholders in the wider global society. This means that websites can be a communication point for ordinary members of the society to present their petitions and concerns for improvement. This is something that would not be normally possible due to the bureaucracy and other elements of distance that separates the commoner from the boss of GM or Toyota. The various funds of GM, Toyota and BMW can fairly be accessed by those who genuinely need help via the websites. Also, the website can be an avenue for the presentation of opportunities to the public. This acts as a live channel for the involvement of the wider society in the efforts being made by these car manufacturers in their bid to improve their activities. For instance, the GM website encourages the public to contribute to their fund whilst the BMW website shows their customers how they can contribute to their research into cutting carbon emissions by remaining loyal to them. The Websites and Stakeholder View Investors Although profits are still important elements of businesses, investors consider other matters like going concern, social change and legal compliance (Simpson, 2005). The website of Toyota, GM and BMW have special pages for investor relations which discloses information in these areas in a specialized manner. This gives assurance about going concern, voluntary ethical standards, CSR and other forms of obligatory legal compliance that they are involved in. Potential Employees In choosing a job, employees look out for job security, fairness and career development (Malkovich, 2010). The Toyota website has a specialized segment for prospective, current and future clients. BMW and GM have sections for prospective employees. However, these information have limitations in scope although it provides some degree of information about ethics and job security. Potential Supplier Normally, a supplier would look out for a business with a good reputation, solvency and growth in a client (Thompson, 2008). Toyota, GM and BMW have their financial statements online which suppliers can examine and take decisions about. This, coupled with the information about ethics and CSR gives sufficient assurance to prospective suppliers on their operations with these car manufacturers. Recommendations BMW 1. BMW needs to provide more interactive devices and tools to enable more people to communicate with them. 2. There is the need for BMW to update its information more regularly to provide information on the necessary accomplishments it makes in ethics and CSR GM 1. General Motors will have to localize its plans and agenda in relation to ethics and corporate governance. 2. GM must also provide practical information about what they have accomplished. The information on their websites are too authoritative and do not provide a clear picture of activities they have been involved in. 3. There is the need for the GM website to be made more interactive than how it is now. This way, the company can utilize its website as a tool for communication. Toyota 1. Toyota must provide more information about their ethical structures and systems since the website is more of a reporting tool and says little about the structures. Primary Reference Sites BMW Responsibilities (2011) BMW Group Available online at: http://bmwgroup.com/bmwgroup_prod/e/nav/index.html?http://bmwgroup.com/bmwgroup_prod/e/0_0_www_bmwgroup_com/verantwortung/ueberblick/verantwortung_ueberblick.html Accessed: 8th July, 2011 General Motors Company (2011) Corporate Responsibility Available online at: http://www.gm.com/company/aboutGM/corporate_responsiblity.html Accessed: 8th July, 2011 Toyota Values (2011) Our Values Available online at: http://www.toyota.com/about/our_values/ Accessed: 8th July, 2011. Other References Banerjee, Subhabrata Bobby (2010) Corporate Social Responsibility: The Good, Bad & Ugly Edward Elgar Publishing Drucker, P. (2007) Innovation & Entrepreneurship 6Edn. Oxford: Butterworth-Heinemann Grant, Robert, M. (2005) Contemporary Strategy Analysis Wiley-Blackwell Publishing. Malkovich, Ester (2010) Human Resource Management Mason, OH: Cengage Simpson, James (2005) Trends in Corporate Governance and Ethics for Global Businesses New York: McGraw Hill. SIRAN (2005). Reporting Comparison and press release. Posted at http://www.siran.org/csr.php, viewed 6/7/11; press release at: http://www.socialinvest.org/areas/news/SP100benchmarkingl.pdf, viewed 6/7/11. Thompson, John L. (2008) Strategic Management in International Business McGraw-Hill UNPRI (2011) Principles for Responsible Investment Available online at: http://www.unpri.org/about/ Accessed: 6th July, 2011. Waddock, Sandra (2006) “Building the Institutional Infrastructure for Corporate Social Responsibility.” Corporate Social Responsibility Initiative, Working Paper No. 32. Cambridge, MA: John F. Kennedy School of Government, Harvard University. Read More