Achieve The Triple Bottom Line

Published Date: 02 Nov 2017

In order to achieve the triple bottom line of social, economical and environmental performance, companies basically require thinking and acting sustainable for their long-term survival (Slaper and Hall, 2011). Most companies which could not be successful in establishing high profit, they have to operate in a secured long-term social stability and high productivity manner in the supply chain, as well as economic performance in the consumer market. Therefore business industry within short time period has explored sustainability objectives mainly derived from the range of environmental protection issues to international as well as national social, economic and ecological issues (Gerard, 2012).

Keeping in mind the importance of sustainable development, most of the corporation’s businesses are in struggle to adopt the various policies of Corporate Social Responsibility (CSR) which is a process to achieve sustainable development in societies by treating their stakeholders ethically or according to international norms (Cochran, 2007, Kuang et al., 2010). Such CSR policies have increased corporation’s management responsibilities to play their role actively in fields of economical, moral obligation (ethical), legal, environmental and discretionary (Kathryn et al., 2012; Chang, 2007; Papafloratos, 2007). Therefore, CSR policies are considered as a strategic systems approach that evaluates and examines the behavior and impact of a company on its society and specifically the environmental issues while keep preserving its competitive advantage (Smith, 2007).

Since last decade, CSR policies for the sustainable businesses have been divided into two sectors. One business community is in favor of adopting such CSR policies which are more focused on new product development (NPD) i.e. the transformation of market opportunities into a product that meets the needs of consumers and other internal and external stakeholders as a potential source of competitive advantage (Pujari, Wright, & Peattie, 2003; Krishnan & Ulrich, 2001; Calantone, Vickery, & Droge, 1995; Brown & Eisenhardt, 1995).

While on the other side, most of the business companies like Xerox, Electrolux, BMW and 3M, are trying to engage extensively in "Go Green" based CSR activities in addition to NPD approaches, which are leading them towards the development of environmentally driven innovations with the ambition of developing new products and services with potential environmental benefits (Isaak, 2002) (Fig.XXX). Such environmental friendly products are termed as environmental product development (EPD) which motivates the redesign of existing products and the creation of new ones to make them more energy-efficient or less material-intensive, significant waste reduction, extends the life cycle of products, and brings out new features and qualities in a product set. (Gutowski et al., 2005; Hart, 2003; Baumann et al., 2002; Markusson, 2001; Brezet & Hemel, 1997; Mackenzie, 1997; Graedel, Allenby, & AT&T, 1995; Shrivastava, 1995). Therefore, General Electric and Toyota have successfully converted CSR practices into superior financial performance as their energy efficient and environmentally responsible products are widely accepted by environmentalists and consumers (Arena, 2006).

In recent years, among various business industries, mobile phone industry prominently has gained a great boom due to dramatic high percentage of mobile phone usage. Mobile phones have become an important tool for the use of various applications like wifi, payment, Internet, entertainment, GPS navigation, agricultural production, municipal management, transportation and logistics and financial services. Therefore, to be fully active to take the challenge of contributing to sustainable development due to high pressure of its stakeholders, mobile phone industry is strongly encouraged to adopt environmentally and socially-sound lending CSR policies.

With this scale and growth comes greater economic, social and environmental responsibility, the mobile phone provider industry has been selected for the current research work and there is need is to look deeper and develop an understanding that how such mobile phone companies are endeavoring to fulfill their economic, social and environmental responsibilities, in pursuit of a harmonious and sustainable development with industry, society and the environment.

1.2 Problem Statement

Since last decade, we are witnessing a tremendous growth on Corporate Social Responsibility (CSR) in the mobile phone industry which reveals that CSR plays not only a major contribution to overall organizational structure improvement and the values and expectations of society (Joyner et al., 2002; Coldwell, 2000; Richardson et. al, 1999; Grunig, 1979) but it helps also in the national economic development by improving the quality of life of the whole workforce (Chang, 2007) for long term basis.

Therefore, mobile phone companies mostly now are claiming boldly that they aren’t in business just for the sake of profits, but also have an intention to adopt social, economical and environmental sustainable business practices. But upto which extent the triple bottom line of social, economical and environmental performance are being considered by mobile phone companies or which CSR initiative are needed to give to their businesses a more holistic sense in order to ensure their viability (Esrock and Leichty 1998), that is still not clear.

Sometimes, mobile phone companies are fully involved in favor of just improving working environment and employees performance while paying less attention about their eco-performance which needs to divert their attention towards use of less hazardous batteries and damages to environment and health hazards along with the matters of recycled content, fuel efficiency, toxic content reduction, and emission-related performance (Prakash, 2002; Chen, 2001). Therefore, there is need to address the problems for those mobile companies whose CSR policies are not effectively based on all such prospects for the sake of their sustainable development.

Furthermore, there are also big conflictions among the mobile phone companies due to their diverse CSR policies which are either in favor of eco-product development (EPD), sustainable product design (SPD), new product development (NPD) or Environmental product development (EPD). There is still a big problem to explore that which would be the best strategic CSR policies to adopt by mobile phone companies in order to remain socially responsible and environmentally sustainable business due to drastic technological changes?

Before furnishing the current explorative research’s questions and objectives, there is need to highlight briefly the mobile phone company’s CSR policies and initiatives and their impact on social and environmental sustainable business practices.

CSR policies of mobile phone companies

Recently, companies in many sectors – including the mobile phone industry – have begun to realize that their responsibility extends beyond their own company and production facilities to social and environmental practices and performances of the companies with which they do business. The following paragraphs provide an overview of the corporate social responsibility efforts of the main mobile phone companies.

Nokia

Nokia CSR policies focus on code of conduct, global employment guidelines, labor conditions standard, occupational health and safety policy, environmental policy, human rights approach, environmental management systems and risk and opportunity management process. Nokia is active in driving environmental sustainability with its wide product range, recycling, manufacturing and supply chain activities and participation in the Global eSustainability Initiative (GeSI) materiality analysis (Nokia, 2012). Nokia is focused on honing the direction that it gives to its suppliers and measuring their performance, ensuring that they closely follow Nokia comprehensive set of supplier requirements for environmental and social performance (Nokia Sustainability Report, 2011).

But surprisingly, Nokia is still not part of an energy-intensive industry and the CO2 emissions and water use in their own facilities is very limited. The energy consumption of Nokia data centers has been increased due to extensive use of Internet access devices, causing the greater environmental impact of their own activities and in some extreme cases, non-compliance with various regulations and customer requirements can cause risks to their operations (Nokia Sustainability Report, 2011).

Samsung

Samsung starting point has been environment and recycling, but the shift on broader CSR type of activities like employee safety and health issues as well support for local communities is visible in the company reports between 2001-2010. (Samsung, 2011). The main themes in Samsung's Sustainability agenda are: Integrity management, Green Management, Social Contributions, Products and Services, and Partner Collaboration. Furthermore, Samsung has operating consultation centers, conducting yoga lessons and meditation programs, as well as volunteer activities to help employees stay productive in a supportive working environment. Samsung Electronics established a dedicated Employee Health Research Center and hired highly-qualified occupational health experts in 2010 in order to better understand potential occupational health risks (Samsung sustainability report, 2012).

While on the other hand, during London 2012 Olympic Games, Samsung being an Olympic sponsor has to face 9-day-long great protest in Seoul, South Korea by the Asian Citizen’s Center for Environment and Health (ACCEH) protestors to force it to review its CSR duties in relation to the workers rights in Korea which is just busy in ‘green washing’ their image, while simply ignoring their CSR duties. Another flaw was observed in its CSR policies was that Samsung was blamed for incurring occupational diseases to its 146 former employees, such as leukaemia, non-Hodgkin lymphoma which voted Samsung as the third worst company in the world by global citizens, and the International Journal of Occupational and Environmental Health (IJOEH), published a Samsung CSR deficiency issue bringing the company’s atrocities to light (Jade, 2012).

Apple

In contrast to Nokia and Samsung, Apple does not provide any structured information related to its CSR or sustainability activities. However, the company provides lots of information related to its environmental and recycling activities as well as supplier responsibility (Apple, 2012). Apple is also increasing its philanthropic activities that have been criticized to be small in comparison to activities of e.g. Bill Gates and Warren Buffett. (Mitroff, 2012). Moreover, Apple had to change its decision to remove devices from EPEAT (Electronic Product Environmental Assessment Tool) rating system due to the public pressure. EPEAT rating system is a program of Green Electronics Council that helps consumers to assess the environmental impact of a rated device (GEC, 2012).

Moreover, Chinese NGO Institute of Public and Environmental Affairs (IPE) performed research and field investigations and revealed that "the pollution discharge from this enormous industrial empire "Apple" has been expanding and spreading throughout its supply chain, seriously encroaching on the local communities and their environment… the volume of hazardous waste produced by suspected Apple Inc. suppliers was especially large and some had failed to properly dispose of their hazardous waste" (Meyer, 2012). Apple must have to be as evolutionary on CSR and sustainability matters as it is with its products. 

1.3 Research Questions

Although CSR has gained enough popularity in recent literature, theory, and practice, but CSR still has some vague concept that the researchers are doing strenuous efforts to define it beyond the confines of corporate sustainability or philanthropy. In some business community circles, it is considered as a response to the present and anticipated climate change challenges, while others considered it as a tool of fair trade, responsible investment and corporate governance (Kenneth et al., 2012).

In the current research work, keeping in mind the great importance of CSR activities/policies and its effective reputation management practice for the sustainable development of the mobile phone companies, following questions are furnished from the background and problem statements discussed above:

What is the extent of mobile phone companies which are already involved in CSR activities and either their CSR initiatives are beneficial for them?

Which are the key drivers which is forcing the international mobile phone companies to participate actively in CSR activities for their sustainable development?

Profit-oriented mobile phone companies, whose CSR activities are mainly based on providing the customer’s and societal needs during their business planning, what is the role of their CSR policies in the sustainable development?

If CSR policies/approaches of mobile phone companies are in favour of "Go-Green" strategy or to become "Green Entrepreneurs", which extra initiatives have to be added in their CSR policies?

Those mobile phone companies, whose CSR initiatives are mainly in favor of long-term profitability and brand reputation enhancement, how much their initiatives are contributing to the sustainable development?

1.4 Objectives

By the end of this study, it is hoped to achieve the following objectives:

To evaluate the drivers that compels international mobile phone companies to participate in CSR activities.

To analyze CSR activities and their impact on sustainable development.

To develop comparative case analysis of established CSR activities of the two leading mobile phone companies of Apple and Samsung Electronics.

To recommend possible policy initiatives to the industry, companies and future researchers which can improve CSR performance and generate sustainable development.

1.5 Hypothesis

As the current explorative research work is basically based on literature review, CSR reports, surveys and dissertations outcomes, therefore any specific hypothesis will not be adopted at the moment. This is because of extensive controversies and doubts on the actual results, motivation, and benefits of CSR approach which is normally considered to be a positive approach. However some key variables will be discussed in detail which may provide the base for future hypothesis development, when a more holistic perspective will be achieved.

1.6 Motivation of the Study

The genesis of this study is the belief that long term competitive advantage requires socially responsible practice by mobile phone provider companies. As the technology is changing dramatically and only those mobile phone companies can keep its competitive advantage and sustainable development that are fully aware and sensitive to the impact of CSR activities like economic factors, ethical orders, environmental and legal requirements and discretionary demands. This study will make us able to analyze that how such factors can influence on the firm’s corporate image and financial performance and how they can create higher living standards, while preserving the corporation’s profitability or the institution integrity.

Moreover, this study will encourage various business industries to make profits while subjecting their 'processes' to responsible behavior and it will divert their attention not only to have high profits at any cost but also on the fact that how they have to make profits.

1.7 Thesis Structure

Chapter

Literature Review

Chapter

Introduction

Chapter

Methodology

Results & Discussions

Conclusion & Recommendations

Chapter

Chapter

The research framework has been structured in the following manner:

Chapter 2 presents the detailed relevant literature review related to framework of the research study; Chapter 3 highlights the research methodology; Chapter 4 reveals the results of the research and their theoretical and practical implications. Finally, Chapter 5 discusses the conclusions based on the results of the research and the recommendations to the industry, companies and future researchers which can improve CSR performance and generate sustainable development.