Thorntons Company’s Corporate Social Initiatives

Introduction

Corporate Social Responsibility (CSR) refers to the initiatives sponsored by a firm to promote the wellbeing of the community in which it does its business. In the recent past, the concept of CSR has gained root where each corporation is seeking to gain customers’ loyalty by giving back to the society (Benn & Bolton 2011; Crane, Matten & Spence 2008). The UK firms are among the most CSR conscious firms around the globe. This paper explores the concept of CSR with specific reference to a UK firm, Thorntons. The paper will examine the environmental and social initiatives undertaken by the identified company to guarantee the welfare of the society.

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Critical Analysis of Thorntons’ CSR

Water and Energy Conservation

The majority of the projects initiated by Thorntons to promote CSR are directed toward conserving the environment. The environmental conservation plan involves the preservation of water and energy by reducing the overall consumption of the two important resources. In the recent past, the company has recorded a sharp decrease in the capacity of water it consumes in its production processes. Water conservation is an important CSR component since it ensures that the society has enough of this resource. If the company decides to spend water without saving it, perhaps the region in which it operates would run short of water in the near future. In addition to conserving water, the company also ensures that it conserves energy by reducing the overall amount of energy it consumes on a daily basis. The world has experienced a shortage in the overall exploitable energy resources, a situation that underscores the need to conserve the rare resource. Thorntons is aware of the current energy deficits. Hence, it ensures that the available energy resources are used in the best way possible. According to Grant Thornton (2014), adopting CSR helps a company in various ways, as shown in Figure 1 below.

Key drivers
Source: Grant Thornton (2014).

In Thorntons, energy is conserved by identifying all the unnecessary operations that consume energy and scraping them from the company’s processes. In 2015, the company achieved a 10% decrease in the energy consumed annually (Charity choice 2015). One of the major benefits achieved by the company because of conserving the water and energy is that it reduced its overall operations costs. The government usually charges the companies operating in the UK some fee in exchange for the supply of water and electricity. The bills are calculated based on the number of units consumed within a certain period. Therefore, a reduction in consumption will lead to a decrease in the bills payable by the company. Figure 2 shows the extent to which the environment has been damaged following companies’ failure to adopt CSR activities.

The cost of damage to the environment by business sectors
Source: (Boychenko 2013)

Other than the savings, the company also ensures that the surrounding communities get enough water for their domestic use. If the company did not limit the amount of water it uses, perhaps the water sources would run dry in the near future. This outcome will not be in line with the concept of CSR. Lastly, by controlling its daily water consumption, the company reduces the overall amount of energy required to pump the water to the reservoirs. This strategy saves the government some money, which could be used for development purposes. Additionally, it reduces the overall greenhouse gas emissions into the atmosphere. It is important to note that much of the energy consumed in the UK comes from burning fossil fuels. Fuels usually emit carbon, which is harmful to the environment. Therefore, by reducing the amount of energy required to pump the water, the company indirectly contributes to the conservation of the environment. However, although the company has achieved much in terms of conserving the environment, it needs to partner with the local community and/or sponsor environmental conservation projects such as tree planting to gain an edge over its competitors (Porter & Kramer 2006). The company may also educate the community about the importance of conserving the environment. Reducing usage alone cannot ultimately offer a solution to the pollution problem.

Ethical Supply Chain

The other CSR activity undertaken by the company is the supply of high-quality goods to customers at reasonable prices. The company achieves this goal by outsourcing its raw materials from highly reputable sources. The major suppliers of its products are Barry Callebaut and Cargill, which provide excellent raw materials (Charity choice 2015). Besides maintaining good connections with farmers from the Ivory Coast, the companies ensure that they grow high quality and healthy products, which are worth their prices in the market. The company regularly audits the suppliers to ensure that they comply not only with the local laws but also with its quality standards. Hence, the suppliers conform to the laws of the countries from which they obtain the cocoa, which they sell to Thorntons. In addition to maintaining high quality for its goods, the company also discloses the health issues attributed to the product.

In the recent past, chocolate overconsumption has been linked to various health issues, which sellers need to unveil to buyers. According to the company’s website, the business is aware of the issues and that it minimizes them by not adding artificial sugars to its product. Additionally, the company educates buyers about the dangers of consuming too much chocolate. This goal is achieved by attaching a script containing such information on each packet. The health of the minors is also considered by the company’s failure to add flavors to the product. Adding flavors to the chocolate would lead to overconsumption by the minors, a situation, which may lead to deteriorated health. However, although the company is ahead of its rivals in terms of embracing the CSR concept, it needs to look for a permanent solution to the health issues associated with its products. As it stands now, the company does very little to promote the health of its customers since it sells its products, despite knowing the health issues they may cause. In the future, the company should strive to achieve zero-sugar for its chocolate.

Government and CSO’s Role in Achieving the Described CSR Activities

The CSRs activities described above are largely influenced by the UK government, civil society organizations (CSOs), non-governmental organizations, and other businesses operating in the country. The first one, the government, is responsible for enacting legislation, which regulates the operations of businesses across the country (Galbreath 2006; Peloza & Falkenberg 2009; Gond, Kang & Moon 2011). In the recent past, the world has become environmentally conscious due to the climatic changes that have been experienced in the past few decades. Consequently, the UK, just like other nations around the globe, has enacted various legislations that hold companies responsible for any pollution that they cause. The Environment Protection Act of 1990 requires companies such as Thorntons to take care of the environment by reducing their overall emissions to the environment. The decision by Thorntons to reduce the overall water and energy consumption is congruent with the Act since the plan endeavors to help in reducing the overall amount of coal used to produce energy.

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It is important to note that coal is the major source of energy for the UK. This finding underscores the need to reduce its consumption since it is responsible for greenhouse emissions. Other than the Act, the government has several institutions that regulate the consumption of water and energy by UK firms. One of the key governmental institutions that have ensured that Thorntons remains environmentally friendly is the Food and Drink Federation (FDF) (Albareda, Lozano & Ysa 2007). The stated organization assesses the operations of each company in the UK and sets the energy and water limits, which firms should use. Thorntons, as a member of the institution, has signed a contract to reduce the overall energy consumption. According to the company’s website, the company has managed to comply with the limits set by the body, a move that indicates its commitment to conserving the environment.

Other than the FDF, the company is also a member of the Federation House Commitment (FHC), which regulates water usage by companies. Thorntons signed an agreement with the mentioned institution compelling it to reduce its water usage by 20% by the year 2020. On the other hand, NGOs and CSOs play a pivotal role in causing companies to comply with pollution laws. Such organizations act as watchdogs for the government. They raise the alarm concerning any organization that causes pollution to the environment (Arenas, Lozano & Albareda 2009; Fischer 2004; Quairel-Lanoizelée 2011). Additionally, NGOs work closely with local firms to sponsor environmental conservation initiatives. NGOs may be more effective compared to governmental institutions since the latter organizations are present on the ground, implying that they are aware of the environmental situations.

For the ethical supply chain, the government equally plays an important role in ensuring that Thorntons’ supply chain and the production processes are in line with customers’ health needs. The Food Standards Act of 1999 protects customers from irresponsible firms that may offer unhealthy food products (Hamid 2016). Through the Foods Standards Agency, the UK government regulates companies’ supply chains, production processes, and distribution channels to ensure that they meet the set health standards. Such standards compel Thorntons to outsource its products from ethical companies to guarantee its customers healthy chocolate. The UK advertising industry is one of the most regulated industries in the world, with the government playing a direct role in controlling the sector. False advertisement is a criminal offense in the country. Customers are empowered to demand the package as promised in the adverts. Besides, under the advertisement legislations, customers have the ability to rescind a purchase agreement with the seller on the grounds of a false advertisement (Nava et al. 2013). This situation compels Thorntons to place scripts regarding the ingredients used to make the chocolate products and to disclose all the material facts regarding the health issues associated with the products. The scripts warn customers against consuming much of the product in the backdrop of the emerging numerous chronic illnesses.

Critical Analysis of the Influence of FHC in Thorntons’ Water Conservation Strategy

As stated previously in this paper, Federation House Commitment (FHC) is one of the institutions that have played a vital role in helping Thorntons to achieve its CSR objective of reducing water consumption. The stated organization provides incentives aimed at attracting firms to show commitment to reducing their overall water consumption. One of the incentives available to the member companies is technical support for water conservation. Once a company subscribes to be a member of the organization, it receives a technical team to help it in assessing areas, which lead to water overconsumption (WRAP 2012). Based on the assessment, the technical team in liaison with the concerned company develops the water consumption targets to be achieved by the company in question. For Thorntons, FHC helped to identify areas in which water leakages continued without the knowledge of the company. Before the company subscribed to FHC membership, it used the utility monitoring software to track water usage.

It fully relied on the data obtained from the software, assuming that no wastage was occurring in the company’s operations. However, the assessment of water usage in the company by FHC’s technical team revealed that it paid for extra 30,000 cubic meters whose use could not be traced (WRAP 2012). Following the lead, the team identified areas in which water was apparently being lost through leakage. The identification and the subsequent fixing of the water system resulted in savings for the company. The availability of such technical support is a major source of inspiration for companies to apply for membership to reap from water conservation. However, although technical support is arguably one of the major drivers of the embracement of water conservation in Thorntons, the shortage of technical staff may prove otherwise. In the past, FHC has been criticized for its failure to offer such support when it is needed. The problem is associated with the low number of technical staffs coupled with the rapid growth of its members.

In addition to the technical support, the organisation plays a critical role in encouraging companies to honour the water conservation agreements they make with FHC when they subscribe for membership. This goal is achieved by making annual assessments of water consumption for the member companies and publicising the companies that achieve high decrements in water expenditure (WRAP 2012). The information acts as an incentive for companies to achieve the set targets to receive publicity in the backdrop of the rising awareness among customers about the need to conserve the environment (Crane 2008; Carroll 2008; Lawrence & Weber 2008). It is important to note that customers are increasingly engaging companies, which are environmentally conscious. In fact, they tend to shun those that are reluctant to conserve the environment. Since Thorntons became a member of FHC, its annual achievements have successively been publicised, a move that encourages it to cut wastage to obtain a better reputation in the future (WRAP 2012). However, as much as publicity is a crucial element of encouraging firms such as Thorntons to reduce their water consumption, FHC needs to develop more incentives to achieve better results. Publicity alone is not encouraging enough to cause firms to abide by the agreements. There is the need to partner with the government to offer other attractive goodies such as tax incentives to the companies that achieve their targets.

Why the UK and the CSR Activities Are Selected for This Analysis

One of the reasons why the author picked the UK to analyse the concept of CSR is that the country hosts the most socially responsible companies in the world. In the UK, the concept of CSR is widely applied. Most companies in the country know how to utilise it to gain a competitive advantage over the rivals (Quairel‐Lanoizelée 2011). Additionally, the country’s laws regarding environmental conservation in line with the selected CSR activities are among the most elaborate around the globe, hence making the activities suitable for analysis (Nava et al. 2013). It is important to note that the embracement of CSR by companies is largely influenced by the laws of the land, which underscore the need to analyse the topic from a country with straightforward legislations. Based on this view, the author deems it fit to analyse the topic based on the country.

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Conclusion

In the recent past, companies have realised the need to embrace the concept of CSR to achieve a competitive advantage against the backdrop of the rising awareness of the need to conserve the environment. This paper has explored the CSR concept with reference to Thorntons, which is a UK chocolate producing business. The analysis has confirmed that CSR is an important aspect of the contemporary business and that companies need to embrace it. The two major CSR activities, which Thorntons engages in include water and energy conservation and ethical supply chain. The listed CSR endeavours have been described in details in this paper.

Reference List

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