Table of Contents
Introduction
The company chosen for this assignment is Reckitt Benckiser. It is a well-known British multinational consumer goods company with a team 37,000 employees. Their only vision is to provide a healthy living lifestyle for people across the globe. They invest heavily on research and development, environmental and social sustainability targeted towards the society. Moreover, they also act sustainably and responsibly towards the society. Reckitt Benckiser refers their business as ‘better business’, as they are successful in providing healthier and fitter life for the people. They are a major producer of hygiene, health, and home products worldwide. The case study will focus on the strategies and techniques that Reckitt Benckiser uses in implementing their environmental accountability to society. Furthermore, emphasis will also be put on how the company is socially responsible towards society in which it operates. Moreover, the case study will also highlight how well the company maintains its social/sustainability reports.
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Discussion
The different engagement techniques and strategies the company is using in implementing their social and environmental accountability to society
Reckitt Benckiser is using different strategies and techniques in implementing their environmental and social responsibility to society. Reckitt Benckiser is fully committed towards addressing and recognising sustainability opportunities and issues that are vital for the stakeholders both externally and internally (Reckitt Benckiser Group plc., 2016). Moreover, Reckitt Benckiser believes being clear when they are communicating about their sustainability preferences and performance and shares this news to the media. The materiality report of the company in the year 2016 showed that there were 198 hidden issues. They have reduced 35% of CO2 emissions in 2007 at their factories and reduced their water usage, energy usage, waste water, and also they have lowered down the total number of accidents that is happening in their company. The company also took a remarkable initiative to save the children by the programme named “Save the Children”. Reckitt Benckiser has also disclosed some of their corporate social responsibility initiatives such as: Firstly, they are aiming towards reducing carbon footprint by 30% per unit by the year 2020 (Reckitt Benckiser Group plc., 2016). Secondly, they are also aiming for reducing more water discharges and wastes. Lastly, they have a vision of saving more lives in the coming years. Another prominent initiative named “Trees for Change programme” is taken by the company to remove carbon monoxide from the environment. Their 2020 goals are targeted towards reducing 35% energy, and 40% reduction in the carbon emissions segment (Reckitt Benckiser Group plc., 2016).
Figure 1: Reckitt Benckiser sustainability priorities
(Source: Reckitt Benckiser Group plc., 2016).
Reckitt Benckiser communicates with its potential stakeholders by all modes of communication such as telephone, focus groups, meetings, etc (Reckitt Benckiser Group plc., 2016). They communicate with both internal and external stakeholders for the current emerging issues in terms of environment and sustainability so that together, hand in hand, they can solve them.
Figure 2: sustainability priorities
(Source: Reckitt Benckiser Group plc., 2016 ).
Reckitt Benckiser manages the expectations of its stakeholders quite smoothly. First and foremost, they communicate proactively with their stakeholders. It helps the stakeholder group to handle issues, risks more efficiently. Secondly, they are also successful in establishing proper agreement with the stakeholders this in return helps Reckitt Benckiser to manage their expectations to a large extent (Reckitt Benckiser Group plc., 2016).
Figure 3: Carbon, water impact and water use in 2016 by Reckitt Benckiser
(Source: Reckitt Benckiser Group plc., 2016)
The customers of Reckitt Benckiser are quite happy due to the effective initiatives were taken by the company. The “Save the Children” is one of the most successful initiatives ever taken by Reckitt Benckiser in recent times. By harnessing their entire business process in innovation, brand initiatives, and employee initiatives they have developed this excellent programme “Save the Children”. They have mainly established this programme in Nigeria, Pakistan and in India. For example, it has been observed that the school children in Kalkaji in India wash their hands often in the washing station. It is completely made possible by the partnership between Save the Children and Reckitt Benckiser (Reckitt Benckiser Group plc., 2015). In the past few years, the company has also provided its aid to the families who have completely lost everything due to natural calamities. They have also kept aside an emergency fund which helped the victims of Nepal Earthquake, people affected due to flooding in Mozambique, etc. Reckitt Benckiser’s long-term strategy includes in reducing the waste generation by their factories worldwide (Reckitt Benckiser Group plc., 2016). Moreover, their hazardous waste decreased by 19.4% per unit compared to 2012. Their remarkable continuous waste generation has reduced the hazardous waste generation by 42.5% per unit of their production. Needless to say, it was achieved by Reckitt Benckiser’s hard work by identifying the alternatives to landfill their destructed stream. They have also launched ‘race to zero’ programme and global employee challenge for encouraging recycling ideas and innovative waste reuse as mentioned in the company’s annual report. According to Wall Street Journal, Reckitt Benckiser is growing day by day and standing out of the crowd by just focusing on the health care products (Reckitt Benckiser Group plc., 2015). On the other hand, as per, The Economic Times Reckitt Benckiser’s smart initiative regarding Swachh Bharat have boosted up their sales by 14%. In the present year 2017, they have signed an agreement for acquiring Mead Johnson. Furthermore, they have stated in their annual report that it is believed as one of the important step for them as a leader in the consumer health segment as they are hoping that company’s revenue will increase by 90%. Reckitt Benckiser’s compliance management committee is attempting a review of quality and safety management systems. There are many initiatives taken by them on the compliance and training segment for increasing awareness and understanding slavery and human rights for their suppliers as well as for their employees. Reckitt Benckiser has made eLearning mandatory for their suppliers and management group (Reckitt Benckiser Group plc., 2015). They are also quite responsible and committed to ensuring that raw materials are used in their packaging and products that can be aligned and meet their goals beyond applicable regulations and law, safeguarding safety and health, protecting the environment and bio diversity. Moreover, they strongly oppose deforestation that is in return helping them to achieve sustainable development.
Figure 4: Save the Children by Reckitt Benckiser
(Source: Reckitt Benckiser Group plc., 2016).
The PR team of Reckitt Benckiser is excellent, as they are responsible for promoting the social causes and any release of new products by the company. They are actively involved with the journalists for keeping them updated with the important things happening in the company that needs to be covered by them.
Discuss how the company has verified its sustainability/social reports. Critically evaluate the assurances, if any, the company has provided as a form of verification.
The sustainability report of the company is the key ingredient for continuing their communication with their potential stakeholders on company’s approach to the sustainability issues and the risks attached with their long-term profitability. The sustainability report is mainly aimed at their audiences who have supported them immensely throughout their sustainability initiatives (Reckitt Benckiser Group plc., 2015). It includes the trade customers, investors, shareholders, employees, suppliers, etc. The report is always prepared at the end of the year and the report is calendar annual year basis. The previous reports of the company can be found on their website under reports and policies. Reporting standards of Reckitt Benckiser is excellent as they prepare their reports using G4 sustainability guidelines and Global Reporting Initiatives.
Furthermore, they prepare their reports using the guidelines and principles set out in the AA1000 Accountability Principles Standard and in the AA1000 Assurance Standard. Reckitt Benckiser took one of the best practices while reporting the corporate sustainability. Their key performance indicators are determined by the following: Firstly, the meaningful sustainability aspects of their operations (Reckitt Benckiser Group plc., 2015). Secondly, the external sources which are used by Reckitt Benckiser as guidance to report and measure the sustainability aspects. The sustainability report is solely prepared by the Board of Directors of the company. Reckitt Benckiser has carried out this sustainability report by their expert and experienced team. Moreover, the Board of Directors of the company have established a strong objective for measuring and preparing the sustainability data for meeting the needs of the Reckitt Benckiser’s stakeholders at any point of time. The data is verified by the Ernest and Young. The Pricewaterhouse Coopers has provided them assurance in the year 2016 over the selected data.
It is reported currently they are ending their relationship with regards to audit with PwC after continuing for 20 long years. Reckitt Benckiser is ISO 14001 certification. The data presented by the company is solely verified by the team of their internal auditors. The data presented by them collaborates with the external key stakeholders such as media.
Financial sustainability – a theoretical concept or an emerging reality?
Financial sustainability is not a mere theory or concept anymore but is regarded as the emerging reality presently (Accounting, Finance, and Operations Management., 2016). The stakeholder engagement holds quite an importance for the company for their normal business activities. Their potential stakeholders include customers, employees, etc. Reckitt Benckiser has emerged as one of the most sustainable organisation in the recent times. They are committed to running their business responsibly in a sustainable manner (Reckitt Benckiser Group plc., 2015). Furthermore, Reckitt Benckiser has also realised that the products they produce have both indirect and direct environmental impacts. Hence, they have proven themselves as one of the most environmental friendly company.
The company is also well aligned with the compliance rules and regulations. They operate globally so they always maintain all rules and regulations properly. Their environmental objectives are also magnificent. Firstly, they always ensure that the environmental issues are properly addressed when important decisions are taken by new product development, supply chain, etc. Secondly, they always aim for using natural resources and energy efficiently and wisely by minimising waste and recycling the products (Reckitt Benckiser Group plc., 2015). Thirdly, they are also targeting to engage their customers, suppliers, and their potential stakeholders on environmental issues by reducing the greenhouse gas emissions to a large extent. Lastly, they also ensure that their employees are well aware of the environmental issues for knowing why they hold an important place for the company. Reckitt Benckiser also provides proper training to the employees with regard to the environmental responsibilities. The social responsibilities are linked with the company’s shareholder group appropriate to the activities and towards whom the programme is largely focused includes the employees of Reckitt Benckiser, and in the community on which they operate. They consider sustainability is an important component in their product innovation process. They are always inclined towards providing sustainable and safe products to the customers. Reckitt Benckiser is constantly innovating their manufacturing and design for using less energy, water, and packaging.
From the year 2001, it has been observed and witnessed that they have restricted themselves from using some ingredients which are harmful to society and the environment. They are also successful in maintaining the Restricted Substances Lists for minimising the use of harmful ingredients (Reckitt Benckiser Group plc., 2016). They always believe in the fact that responsibility goes hand in hand. They have created an image of the good and socially responsible company by taking various initiatives that benefitted the society to a great extent.
Conclusion
The entire case study highlighted the importance of financial sustainability. It has been largely witnessed that Reckitt Benckiser is one of the greatest company in maintaining excellent financial sustainability. They have proved themselves as one of the most socially responsible company currently. Financial sustainability is one of the most discussed topics in the recent times globally. Reckitt Benckiser took many environmental initiatives for being a sustainable company. One of the most highlighted and successful programme of Reckitt Benckiser is “Save the Children” by this programme they have helped and still helping numerous children all over the globe. On the other hand, they have taken some initiatives for reducing water, the Greenhouse gas, and CO2 emissions. The stakeholders hold an important place in the company. Reckitt Benckiser also gives training in form of the e-learning to the employees so that they will be well aware of the environmental issues. The company is continuously striving for being one of the best sustainable companies.
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