Online Users

Custom Search

Categories

« Reflect on what you have completed so far | Main | Supply and Demand Assignment »

05/23/2012

Using CSR as a Tool for Customer Loyalty and Stakeholder Value: A Case Study of Unilever in Ghana


Using CSR as a Tool for Customer Loyalty and Stakeholder Value: A Case Study of Unilever in Ghana

 

Introduction

In most of the business core studies, the usual focus of the researchers is the activities in the field of corporate social responsibility (CSR). Because of the influence coming from the globalization, privatization and liberalization processes creates a great impact in influencing upon different societies across the globe. The corporate activities are monitored by the government and various organizations with an aim to ensure the alignment of their public statements with their practical activities. The credibility of such monitoring is however contingent upon reliable and good quality corporate social responsibility of the organizations.

Company Overview: Unilever, Ghana

Unilever is a Dutch company specializing in food, home and personal care products, has operations in 100 countries in Asia Pacific, Latin America, Africa and Middle East, Europe and US.  In 2003, it employed 52,000 people in Africa and the Middle East, with 234,000 worldwide.  Unilever has been in Ghana since 1963, with brands like Sunlight, Omo, and Blue Band margarine. Unilever Ghana has not done quite as well, market wise in the years 2005 and 2004 but there are brands of products for which it still dominates the market. Indeed, it is a market leader and the annual report suggests that the prospects are bright. This optimism is also shared by the workers who in general expressed a lot of faith in the company’s ability to prosper and in the process continue to treat them well.

The CSR

Corporate Social Responsibility (CSR) is a concept wherein companies integrate social and environmental concerns into their business operations and in their interaction with their stakeholders on a voluntary basis. The important aspect of this responsibility is voluntarism. Businesses are expected to recognize the opportunity and the responsibility to set high standards for protecting the natural, human and economic environment of the citizens in their areas of operation.

CSR Practices

Unilever, in conjunction with the Ministry of Health and UNICEF, recognized the growing problem of iodine deficiency and formulated a business plan to supply iodized salt more cheaply.  Unilever in India had experience with a low-cost iodized salt called Annapurna.  The Popular Foods team in Africa decided to rethink its business systems to provide Annapurna to low-income families in Ghana.  It keep capital costs down, they outsourced production of iodized salt, creating over 200 jobs and partnerships with over 60 suppliers within Ghana.  They developed partnerships with local manufacturers, investing time, resources and training to help them raise the quality standards. They also saved on brand development costs by drawing upon the experience of Annapurna in India.  This included running a series of road shows to raise awareness of Annapurna and aligning the brand’s health messages with those of Ghana’s Health Service, in order to build consumer confidence.  To reach remote villages, Unilever and UNICEF have teamed up with a local bank to provide micro credit facilities to enable village women to buy Annapurna and other products for onwards sale.  Now over 400 women are involved, giving them a useful source of income and helping to decrease iodine deficiency in remote parts of Ghana. 

For the customers, the CSR is important to ensure that the organizational policies add value to the customer satisfaction and earn their loyalty. Aside from the broad commitment to social welfare, there is an assurance that the products and services offered to consumers are of the highest quality and that these products and services are provided with due regard for the welfare of employees.

For stakeholders, the company provides training for small scale artisans as part of its responsibility. This is helpful but it will be even more helpful and educative to all stakeholders including the academic community if the results of post training evaluations or tracer studies are publicized. This will allow society to reflect if the money being invested is yielding desired results. It may also lead to suggestions for modifications where necessary.

Conclusion

Corporate social responsibility is an essential element of present and future social policies. The strategy is to develop the multinational economic and financial groups that is needed in global market economy or firms that going through serious of internal crisis. The strategy is a replacement for many socially and ethically irresponsible practices to avoid or lessen the possibilities of bankruptcies, fraudulent actions, and even disrespecting for the basic working values.

References:

Britwum, A., Enu-Kwesi, F., & Akorsu, A., (2006) Unilever: Ghana, Centre for Development Studies (CDS) Research Report, University of Cape Coast

Singh, A., Kundu, S., & Foster, B., (2006) Corporate Social Responsibility through the Supply Chain: MNCs to SMEs, World Bank Institute & School of International and Public Affairs, Columbia University

 

comments powered by Disqus

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

The comments to this entry are closed.

Get posts by email address:

Delivered by FeedBurner








Blog powered by TypePad
Member since 09/2011