Li esbet h van den Boogaar d

Corporate Social
Responsibility in
the Food Industry
How internal and external communications
support CSR
Liesbeth van den Boogaard
(1963) is working for Master-
foods (previously Mars B.V.)
in the Netherlands since 1997.
She is currently in charge of
External Affairs & Communi-
cations. Before that she
worked for three years in
Belgium for EDS in the area
of InformationTechnology
management. In the
preceding five years she
worked in countries in
the Western Pacific region
in various positions in
diplomatic missions. She
started her career as an
organisation advisor for PTT
Post in 1986 in Rotterdam.
She is holding Master degrees
in Business Adminstrations
and Management of IT
systems and a BSc in Home
Economics. Liesbeth enjoys
good food, classical music,
travelling, hiking and
gardening.
The purpose of this thesis is to map what Corporate Social Responsibility (CSR) is and
how it is being implemented by multinationals in the food industry. The role of the
(corporate) communications professional in implementing and communicating about
CSR will be specifically highlighted. The theory of CSR is described and the
management of tangibles and intangibles that together shape the multi-faceted
activity labelled CSR. The tangibles that are described in this thesis are considered as a
must have and considered part of the Corporate Ability. Amongst others CSR is an
important extra tool for organisations to enhance their image.
Corporate Social Responsibility has been a popular topic for some time in the media,
for academia and for agencies organising conferences on topics of public interest. In
spite of this popularity very few in-depth studies on this topic are available. CSR
focuses on the corporations perceived Social Responsibility and stands next to
Corporate Ability (CA), the ability of organisations for producing products or services.
CA is a must-have for every organisation whereas CSR is something extra that may
have a strong influence on purchase intentions of consumers. CSR can be applied on
corporate and brand level. Stakeholders have views of organisations and of brands.
This thesis describes the implementation of CSR on a corporate level. The central
research question of this thesis is as follows:
HO W C A N I N T E R N A L A N D E X T E R N A L
C O MMU N I C A T I O N S S U P P O R T C S R ?
To attune business unit level communications and corporate communications to CSR,
organisations have to work with Common Starting Points (CSPs). CSPs are central
values that function as a basis for translation into all forms of communications used
by the organisation. To be able to define CSPs the communication officer has to have
knowledge of what CSR means, what the motivations are, which tangible and
intangible components influence CSR, how it is communicated and in the end will be
audited.
What is CSR and what are the motivations?
The most used definition of CSR is the following:
Economic, Social and Environmental development that meets
the needs of the present without compromising the ability
of future generations to meet their own needs.
Cor por at e Communi cat i on Cent r e 26
One thing is clear from this definition. CSR is based on three interrelated pillars: the
economy, the environment and social aspects. In other words, the triple bottom line
(TBL), people, planet, profit. Entrepreneurial activity in the triangle where these three
dimensions come together is truly CSR in the broad sense of the word. The planet
dimension is the ultimate bottom line. The economy (profit) depends on the global
ecosystem (planet) and society (people) depends on the economy.
The motivations to integrate CSR into an organisation are a mix between in-
organisation investments and community-investments. In this mix all motivations are
equally important and enhance each other:
Improving Image
CSR has a direct influence on the image of an organisation as the corporate image
is mostly influenced by behaviour. The corporate image can be described as the
picture that stakeholders have of an organisation. For global organisations the
corporate image has to be maintained globally.
Attracting and motivating employees
One of the most important things an organisation needs is motivated employees.
Employees have to be able to identify themselves with the organisation. Therefore
organisations have to show humanity and social responsibility.
To distinct from competitors
Because of the growing quality of production methods it gets harder for
organisations to distinct themselves in the field of product quality. The image of
the organisation-behind-the-brand is becoming more important.
Long-term financial advantage
CSR encourages a focus on long-term profitability instead of short-term
profitability. Privately-owned organisations most of the times already have a long-
term view.
Involvement with society
Organisations want to be involved with the society on a global, regional and local
level. Organisations are becoming more important in shaping global society. That
is why multinationals have to take their responsibilities. Not only on a global level
but also in the regions and local communities in which they operate. Regarding the
local community, multinationals have multiple headquarters so they also have
multiple local communities they should take into account.
Cl as s of 2002 Abs t r act s 27
To comply with standards and values of society
Organisations have to comply with standards and values of society to deserve their
licence to operate. These standards and values are different all over the world.
Taking into account these cultural differences is therefore really important.
An important factor when discussing the subject of CSR is stakeholders. Stakeholders
do select the organisation they do want to interact with. So stakeholders decide on
interdependence and not the organisations managers. Organisations can display
buffering behaviour towards stakeholders or they can show bridging behaviour.
Organisations that have CSR high on their agenda should always try to bridge the
issue.
Tangible and Intangible components
Tangible components of CSR are measurable actions or activities an organisation can
undertake to show it acts in a socially responsible manner. Tangible components have
a strong connection with the Corporate Ability of an organisation. The first tangible
component is ISO/HACCP. ISO and HACCP are international standards and
enhance confidence in products and services produced by the organisation. The
contribution to communications about CSR-activities is that standards make it easier
for organisations to communicate with their stakeholders. Stakeholders know what
these standards mean. The second tangible component is quality management.
Quality management is a basic condition for implementing CSR as it ensures
continuous improvement of processes. The third tangible component, ethics
management, defines if the organisation is a responsible entity or if the employers of
the organisation are seen as responsible. In all situations, organisations, or the
individuals that work for the organisation, have to bear responsibility. Chain
management, the fourth tangible component, is important to improve transparency,
to combine knowledge, to take advantage from the increase in scale and to fight free-
riders behaviour. Trust, co-operation and harmony are the key-elements of chain
management. CSR is still the responsibility of each individual organisation but all
organisations can work together through trade associations, vertical integration (co-
operation with competitors) or diversification (co-operation with other players in the
chain) to create transparency.
The intangible components of CSR are more about CSR associations then tangible
components. An organisation has less influence on the intangible components but
they are just as important to the stakeholders. The first intangible component is issues
management. Issues management is about how organisations deal with issues.
Organisations have to manage these pro-actively and join in stakeholders
communications to prevent them. Top-managers have to be involved in the issues
management process. Furthermore organisations have to posses the following
Cor por at e Communi cat i on Cent r e 28
reputation management capabilities: dialoguing capabilities, advocacy capabilities,
silence capabilities and crisis communications capabilities. The second intangible
component, the evolving society, is describing that organisations have to be aware that
their surroundings are constantly changing. CSR can help organisations in difficult
times to focus on long-term success instead of short-term profitability. To implement
CSR into the organisation the fourth intangible component, sustainability, has to be
taken into account. Most organisations have a cultural lock in - the inability to change
corporate culture even in the face of clear market threats. Organisations get stuck in
convergent thinking - providing well-known solutions. Divergent thinking has to take
over; the context of decision making has to be broadened. In order to be able to destroy
and create at the pace of the market the right mental models have to exist within the
organisation. Internal communication has an important role to play in the process of
changing mental models in organisations.
Communicating and Auditing
Profiling an organisation as socially responsible is dangerous because it attracts a lot
of attention and the expectations are high. Not communicating at all means that
stakeholders remain ignorant of the CSR activities of an organisation. Choices have to
be made on how far CSR has to be embedded in the organisation and how to
communicate on CSR. The corporate situation has to be analysed and a strategy has to
be defined after which CSR can be practised. In this planning process and while
performing CSR activities internal and external corporate communications strategies
have to be defined. The main goal of the internal communications process is to obtain
employee commitment. Creating an internal support base is important because the
internal stakeholders function as ambassadors to external stakeholders. In planning
the communication strategy this main goal has to be kept in mind all the time. The
process of internal communications never stops. In planning and executing external
communications stakeholders involvement and opinions have to be kept in mind.
The model for initiating external communications is similar to the model for initiating
internal communications. Additionally the process of external communications has to
be constructed with five building blocks. First stakeholders have to know what the
organisation stands for. Second stakeholders have to know what the organisation can
do for them. After that organisations have to communicate about CSR and only then
they can persuade and try to inspire action.
Cl as s of 2002 Abs t r act s 29
ompany, Communicatie een sIeuteI
Good Company
Five buiIding bIocks
The last phase of the internal and external communications check is auditing. Every
activity has to be audited from the plan up to the activities. Auditing CSR makes it
measurable. Organisations want to make CSR measurable because they understand
hard data best, it justifies their CSR initiatives, it evidently improves performance and
enables organisations to perform a good benchmark. CSR can be audited against
stakeholders expectations, organisation policies, regulations, external benchmarks,
professional standards and programs and targets through an environmental, an
ethical and/or a social audit.
The benefits of social auditing can be summarised as:
An input of systematic information on what is happening outside the
organisation;
Recognising and working with stakeholders;
Feedback to stakeholders on the organisations achievements;
Strengthening loyalty and commitment among stakeholders;
Continuous risk assessment;
Improving management performance through informed decision making;
Allying increased profitability with social concern;
Gaining legitimacy in the eyes of society;
Cyclical audits should enable continuous improvement to take place, if
cognisance is taking of the results of the audit
These benefits are illustrated by the audit cycle:
Cor por at e Communi cat i on Cent r e 30
Benefits of auditing
Leipziger, Jones, Coleman, Corporate Citizenship
Audit Cycle
Leipziger, Jones, Coleman, Corporate Citizenship
Cl as s of 2002 Abs t r act s 31
Multinationals in the Food Industry
Three case studies show a big difference between organisations in how they are
implementing CSR. Unilever has chosen to profile itself as socially responsible and is
clearly communicating about CSR whenever it gets the chance. Nestl also values CSR
at the heart of its organisation but is not as clearly profiling its CSR-activities as
Unilever. Coca-Cola is still seeking what to do but is already communicating in some
ways. All three the organisations have the tangible components well taken care of. The
intangible components deserve more attention. Unilever and Nestls CSR-activities
are more integrated on corporate level and Coca-Cola performs more activities on
business unit level.
Based on the theory a rating mechanism for CSR and communications has been
developed. Scoring organisations in this way makes it easier to compare the
differences in their communications strategy related to CSR.
Unilever, Nestl and Coca-Cola are rated on how they implement CSR into the
communication strategy in this Figure.
Unilever Nestl Coca-Cola
Implementing CSR
The existence of a global CSR policy + + +/-
The existence of a local CSR policy ? ? +
Clearly engaging in CSR activities (local and global) +/- +/- +
Internal Communications
Communications on corporate level + + +/-
Communications on business unit level +/- +/- +
Involvement of employees ? ? ?
Internal audit + + +
External Communications
CEO is spokesperson on CSR + - -
Department on CSR + + ?
Focus on triple P Integrated Planet People
Which generation of corporate Action Persuasion Connection
commmunications (building blocks) (bridging)
Involvement of external stakeholders ? ? ?
Materials available
Website + + +
Reports + + +
External audit (published) + + -
L I T E R A T U R E :
1. R. Foster and S. Kaplan, Creative Destruction, Why Organisations that Are Built to
Last Underperform the Market and How to Successfully Transform Them, Doubleday,
2001
2. McIntosh, Leipziger, Jones and Coleman, Corporate Citizenship, Pitman
Publishing, London, 1998
3. Kaptein, Ethics Management; Auditing and Developing the Ethical Content of
Organisations, Kluwer Academic Publishers, 1998
4. Jeucken, Sustainable Finance & Banking; The Financial Sector and the Future of the
Planet, Earthscan Publications, 2001
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and Consumer Product Responses, Journal of Marketing, January 1997, page 68 84
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Corporate Brands: When do Organizational Associations affect Product Evaluations,
April 2002, ERIM Report Series, ERS-2002-43-ORG
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Companies, Rotterdam, 2000
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enterprise, The Hague, 2001
9. Janssen and Groesbeek, Handboek Maatschappelijk Ondernemen, 2001
10. VNO-NCW, Maatschappelijk ondernemen; een handreiking, Den Haag, 2001
11. SER, De winst van waarden; Advies over maatschappelijk ondernemen, SER
adviesrapport nummer 2000/11
12. Boudhan, Vonk and Nelissen, Maatschappelijk ondernemen; Dienen en Verdienen,
1996
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14. www.sustainability.com
15. www.mori.com
16. www.skal.com
Cor por at e Communi cat i on Cent r e 32