Profit Or CSR As The Driver For For-Profit Organizations (Essay Sample)

Profit or CSR as the Driver for For-profit Organizations?
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Why is it not Acceptable for a For-profit Company to Profit From Poverty
According to World Bank report on Poverty and Shared Prosperity (2016), 10.7% of the population live on less than 2 dollars a day (p.21). Most of these are concentrated in the developing countries. Though companies’ chief aim in business is to make a profit, ethics dictate that both the buyer and the seller should mutually benefit. Businesses today cannot be influenced by profit margins alone but should also factor in social issues. It will be therefore be improper for a company to make a profit from the poor when the poor do not get a benefit equitable to the amount of money taken from them.
Companies which seek to sell their products to the poor should do so while ensuring that they reduce the level of poverty in their target markets. This can come by when innovative technologies targeting the poor are used to lift them out of poverty. This will ensure sustainability of market since increased level of income usually translates to increased purchasing power.
Another reason why it is not acceptable to profit from poverty is that the business will prove not to be sustainable. In ever changing business environment, a business cannot expect to continually derive profit and ignore the state of the members forming the market. At long run, purchasing power will shrink and the organization will be forced out of business.
Outline of Unilever’s Commitment to Deliver Products to the People at the Bottom of the Pyramid
Unilever uses sustainable living brands to drive growth. It does so by improving health and well-being. Unilever’s brands like Lifebuoy, Pureit, Domesticos and Signal have helped improve health and good hygiene practices. For instance according to the Unilever Summary report (2016) Lifebuoy runs the largest hand-washing programme and has continually scaled up its campaigns over the years to reach 337 billion people from 2010 (p.13). The report also outlines how Knorr was used to tackle malnutrition in Nigeria, how its Vaseline brand was used to cure dermatological infections in Kenya, Philippines and Jordan and its campaign initiated by Signal to raise oral health awareness. (p.13)
Unilever has reduced the environmental impact which their wastes have on the environment and has encouraged environmentally friendly practices in the production zones where it sources its agricultural raw materials. According to the report, the company revitalized its climate change, waste and water strategies and adopted a multi-faced approach (Unilever Sustainable Business and Communications, 2016, p.14.). The approach covered areas such as sourcing, operations and products. The report acknowledges that 60% of the agricultural materials were sourced sustainably, the factory operations reduced carbon emissions by 39% per ton of production in 2015 and the waste associated with its consumer products reduced by 29% (p.14).
According to the summary report, the company has committed itself to enhancing the livelihoods of women farmers and has partnered with farmers in different parts of the world. The company supports women farmers by educating them on how to increase their yields, improving quality and efficiency. The company also entered a three year strategic partnership with civil society organization Solidaridad to develop entrepreneurship skills of small scale farmers and young farmers (Unilever Sustainable Business and Communications, 2016, p.16).
Unilever has also mobilized collective action to eliminate deforestation and ensure sustainable agriculture for smallholder farmers (Unilever Sustainable Business and Communications, 2016, p.18). To eliminate deforestation, the company has transformed its supply chain to ensure that the sources of the palm oil are “fully traceable and certified sustainable” (Unilever Sustainable Business and Communications, 2016, p.19). The company also conceived time-bound plans to ensure that all palm oil sources were certified by 2018 to ensure sustainability of palm farming for small scale farmers.
The company has improved access to water, sanitation and hygiene. It has used its health and hygiene products such as Lifebuoy to ensure sanitation and hygiene. It has partnered with governments to help deliver “sustainable access to safe drinking water, sanitation and hygiene (WASH)” (Unilever Sustainable Business and Communications, 2016, p.21). It has done so by mobilizing greater private sector action, developing market based solutions, engaging citizens and developing new business processes. To help mobilize greater private sector participation, it has facilitated the establishment of WASH4work coalition “to address WASH challenges in the workplace, in communities where workers live and across supply chains” (Unilever Sustainable Business and Communications, 2016, p.21). To ensure public participation in India the company launched Swachh Bharat programme to “promote good hygiene habits” (p.21).
Is Unilever’s Plan a CSR, Strategy or Both?
Unilever’s plan is a combination of both corporate social responsibility and strategy. Corporate Social Responsibility (CSR) is a business approach which deals with viable growth by enhancing economic, social and environmental factors to benefit all the people involved in the business (Mullerat, 2010, p.14). It is a wide concept addressing such areas as human rights, health, social development and climate change. According to Langabeer and Napiewocki (2000) a business strategy is a detailed plan on how to achieve business’ vision, attain set goals, compete favorably with competitors and improve its financial gains (p.100). The business strategy is usually integrated in the company’s business model and dictates the actions and mode of approach to business. Unilever’s approach can be said to be CSR because it benefits the people by ensuring their general wellbeing, protects the environment and ensures sustainability.
It can well be said to be a strategy because some of the company’s undertaking such as agricultural sustainability is aimed at securing the source of agricult...