Discuss about the Business Ethics for Responsibility of Business Firms.
The practice of engaging in business activities that benefits society as a whole is a major responsibility of business firms. This corporate social responsibility poses new challenges for business organization as the demand is also to apply sustainable principles in the business process. Sustainable social responsibility means companies are expected to consider both social and environment risk in business operations regularly. This is essential because firm needs to be good corporate citizen too and they must face challenges by maintaining corporate social responsibility too. A carefully planned strategy may help in meeting both organization objectives and fulfilling corporate social responsibility (Chandler and Werther 2013). Corporate social responsibility promotes attachment with the community and making companies ware that they are not just responsible for isolated financial benefit but they have the responsibility towards the welfare of the community too. Some of the factors that enhance CSR include the demand for corporate disclosure from consumers and key stakeholders, generating consumer interest by ethical ways of business, ethical concerns of investors and demand for skilled employees. The positive outcome for business forms includes not just improved financial performance, but also increases customer loyalty and enhances the reputation of the company (Servaes and Tamayo 2013) .This report will look into the ethical and social responsible action taken by the New Belgium Brewing Company located in Fort Collins, Colorado. It will explain the environmental issues faced by the company and what strategies they have taken to address the issues. It will critically analyze the actions taken by the company to gain competitive advantage in business. Finally, it will provide justification on whether New Belgium’s action is a symbol of socially responsible organization or not.
1.0 Strategic approach taken by New Belgium Brewery to address environmental issues
The New Belgium Brewing Company was established in 1991 after Jeff Lebesch acquired the strain of yeast best suitable for brewing Belgian style ales. The brewery along with laboratory for quality assurance and technological advancement made it famous as an organization with environmental efficiency. They also continuously make efforts to produce new variety of brews. NBB is committed to making an impact on not just key stakeholders but on the planet too. They work to address environmental issues like cost involved in energy to reduce impact on environment, create environment friendly technology to reduce waste and ways to reduce hazardous gas emissions (Newbelgium.com 2016).
As mentioned in New Belgium’s core values and beliefs, they have environmental goals in business such as reducing resource consumed, enhancing energy efficiency and recycling product during the production of brews. These values are also reflected in their action. They have worked to improve energy efficiency by investing in energy saving technologies such as the wind turbine. This was a unique initiative by the company as NBB was the only brewery company to utilize wind power in the United States. Other activities that illustrated their commitment to conserve energy in their business process include the grid installation and communicating with electric suppliers to identify redundant operations that are consuming unnecessary electricity. In such cases, NBB takes action to save power by shutting down those operations. They have also invested a lot of money in energy saving technologies like brew kettle, 20-kilowatt photovoltaic array, sun tubes, steam condenser and many others. While the brew kettle conserved energy by heating the wort sheets only instead of whole kettle surface, the sun tubes allowed access to natural lighting throughout the brewery (Sarason and Hanley 2013).
A very innovative investment towards maximizing energy efficiency was taken by approaches like extracting methane from waste water. This also helped in meeting other power needs of the brewery. As part of environmental responsibility, they also supported the Clean Water Act and ensured that their beer was also manufactured with quality water. For their environmental stewardness goal of recycling, their strategic approach was to recycle all possible products in the brewery such as packaging boxes, beer glasses, caps and other materials. They also made sustainable efforts to enhance environment by distributing used barley and grains too farmers to feed cattle (Bamforth and Cabras 2016). They were also serious about reducing pollution and took actions to encourage more employees to buy recycles products and guided them to use environment friendly transport service. These actions indicate that they were really serious about advocating business process that promotes safety of environment. Their exceptional work towards environmental responsibility was also recognized when they were included as member of Business for Innovative Climate and Energy Policy (BICEP) and they signed declaration to address and regulate climate changes (Pandey et al. 2013).
To reduce impact on environment, the New Belgium Brewery has always introduced green technologies in each of their breweries. They have always paid attention to finding new methods and technology to reuse, conserve or extract energy. Hence, NBB has achieved a lot in their quest for environmental sustainability and this much efforts has not been taken other brewery company in the United States. They have achieved a lot compared to other countries which in evident from certain activities. For example their aim is to produce 1 gallon beer by using 3.5 gallons water and this figure is less compared to other company’s consumption of of water for producing beers. They have taken exaggerated steps to achieve perfection in environmental goals because they have been able to recycle almost 99% of waste products and get 100% of its power from renewable resource. This means they have taken their best approach possible to reduce environmental hazards. They are still not planning to stop and their latest goal is to reduce carbon emission from products by at least 25%. This is an impressive figure and they have been able to sustain the efforts by the guidelines for sustainable business practice. It enable them to maintain environmental sustainability by supporting eco-friendly suppliers, analyzing the power consumers on packaging products from starting to ending and constantly updating technologies to save energy cost (Fish 2015).
They have created a positive image by their smart decision to making to reduce environmental hazards in business operations and now they act as role model for other companies to achieve environment goals of business. They have taken such strong initiative because they are aware of the association of carbon footprint with each business activity. They are clearly aware of the consequences of environmental issues and so they have taken strong initiative to build trust and creative image with their suppliers as well as with brewery industries. They are of climate changes due to greenhouse gas emission and so they try to identify areas where their brewery is releasing more greenhouse gases. They have detailed estimates of total emission and they constantly identify ways to reduce the emission (Newbelgium.com 2016).
View regarding key competition gained by social strategy
New Belgium Brewing Company is also aware of its social responsibilities and they have taken steps to enhance deprived community lives through philanthropic activities like charities and fund raisers. This initiative can give competitive advantage to the company when consumers see that the company is serious about its corporate social responsibility in business. This will be good for their business too as they can build trust with customers and build positive image in the community. They have also earned rich dividends for their efforts by loyal followers and visitor. This report will first discuss philanthropic activities of the company and then decide its competitive advantage gained by NBB. The consumers can get insight into the social responsibility undertaken by the company by their different philanthropic activities. Since the foundation of the company, NBB has spent about seven million dollar in social cause. They also take out the profit earned from each barrel of bear to contribute for human welfare. They recognize the corporate responsibility towards the community and they distribute funds in each state according to the average sale in the state (Stead and Stead 2016). By this approach, they try to support the community that consumes their beer. They are also a member of a social network called ‘One Percent for the Planet’.
In case of distressed people who are homeless or have lost their houses in natural disaster or fire, NBB have taken the initiative to provide a shelter for those families. They have a specialized community for philanthropic activities and they take decision on allocation of funds. Some employees in the brewery are the members of the Philanthropy Committee. In order to execute social responsibility in an efficient manner, they get linked with non-profit organization that provides innovative solution to social cause and meeting social objectives. The Committee also supports those groups which focus on community involvement in their business operations (Lynch 2016).
NBB regularly post community activities and propose any new philanthropic events that they are going to organize. They also take feedback from employees to identify opportunities of providing a helping hand to the company. In this non-profit organization also get a chance highlight their community activities. For raising funds or grants easily, NBB has also created a website where interested organization can easily apply for grants or donate funds. Their concern for social cause is also demonstrated from reports where they mainly focus on sustainable agriculture, water conservation, energy conservation and many others. They are also focused on preventing damage to the environment and support those events that cause minimum damage to the environment. Another example of social activity is the event called ‘Tour de Fat, where NBB sponsors environmental and social non-profit organization. Sustainable transportation was promoted by this event by showing to the world people exchanging cars with commuter bike. The company was found to be a common supporter in all such events or festivals in United States (Reid and Gatrell 2015).
Other evidence of their philanthropic activities suggest that they have donated upto 8 million dollar in 2015 and their employees also volunteer to take their time out for fund programs. An example of their philanthropy program is the local grant program whre they inspire their consumers and the community to enhance their health of the planet and embrace sustainable choices in life. They had also taken the initiative to educate youth from diverse range of background about the link between nature and human and how they can make safe choices for the safety of environment. NBB also agrees that as beer comes from natural products, a vibrant ecosystem is necessary to produce high quality beers. Hence, they have planned to protect the ecosystem and encourage sustainable and regenerative agriculture in their premise (Newbelgium.com 2016).
Hence, from the above philanthropic activities, one can conclude that NBB has gained competitive advantage by making their own unique brand image. This has been possible because of its high quality products as well as commitment towards a sustainable and safe environment. The company has a large number of suppliers and high demand for their philanthropic events. Consumers have more trust on the company due to value of their products and their role in social environment. Unlike other companies, they have not just focused on their own profit, but also taken steps to reduce impact on environment through investment in energy saving technology. They reflect an adequate example of a corporate brand which is driven by innovation, quality and social responsibility. For their success in sustainable social responsibility, they also have been awarded with Ethic Award for their role in promoting environmental excellence through their innovative technology. In different beer festivals also, their brews have been awarded medals. Hence this form of accolade is also a proof of their competitive advantage in the brewing industry. Through their efforts, they have created a positive image with their customers. There is a normal notion that an alcohol producing company can never think about the welfare about the community, but NBB had managed to go beyond that notion and prove that their best to contribute the safety of the community. Despite commendable actions towards achieving social excellence, they still have scope for enormous improvement and get recognized as a corporate citizen (Pullman et al. 2015).
Certain groups of people in the society think that an alcohol or tobacco producing company can never become a socially responsible organization. However, New Belgium Brewery have proved the people wrong by taking strong action to curb environmental hazards and contribute to the cause of mankind. I believe that New Belgium is an epitome of a socially responsible corporation due to their best possible action taken to enhance the environment. A range of examples of their activities for the cause of the environment and human welfare will prove the fact true (Lock and Seele 2016).
Firstly, they have promoted environmental friendliness by finding alternative methods of brewing beers that is cost-efficient and saves energy too. The brewery had purchased a number of energy-savings technologies like sun tubes, steam condenser, grid installation, photovoltaic array installation and many other technologies. The purpose of all this technology was mainly to save energy through these innovative technologies. Secondly they also realize the importance of clean water and supported the Clean Water Act and also ensured that their beers are produced from safe and clean water. NBB had promoted environmental sustainability by taking strategies for recycling waste. They do not waste a single by-product in the brewery. While the spent grains are given to farmers for cattle feeding, they utilize bacteria from waste water to convert it into a high protein food for fish. Hence through their environmental stewardship of reducing, reusing and recycling products, they prove that they are a socially responsible corporation (Servaes and Tamayo 2013).
The sustainability report about the company suggests they have been contributing to green building techniques from a long time. It is because of their concern for environment and use of energy saving technologies only they have found place as a member of BICEP. Their approach towards the achievement of sustainability is an inspirational achievement and no other company from the same industry has managed to achieve what NBB had achieved. They also recognize the fact clean water is a basic human right and since they utilize maximum water for making beers, they identify ways to reduce water consumption as far as possible. They make sure that they do not use any cleaning agent that is toxic for the environment. Therefore, this activity suggest that as corporate citizen, they respect and support water conservation policy.
They are concerned about the prosperity of their coworkers and have encouraged smart growth practices in the organization by supporting environment and social friendly systems. By various funding projects, NBB officials have seized the opportunity to protect natural resource and make people embrace environment friendly transportation too. For a vibrant future of the earth, NBB has used tools to collaborate sustainable business practice. As a socially corporate citizen, the staffs at NBB have established a group that sponsors events to help needy co-employees or other community members. The staffs themselves will to become a scout and arrange food and funds for needy people. Normally business entities are involved in their own financial objective, but NBB’s great efforts to advocate social responsibility is a source of inspiration for many other corporate organizations (Aguinis and Glavas 2013).
Their advocacy for humanity is seen by the effort of the philanthropy committee and various fund raising events. In these events they have appreciated those groups that incorporate environmental and social sustainability in their business operations. They want to inculcate the social advocacy in each staff at NBB that is why they regularly maintain a bulletin board to make employees aware about their community welfare activities. Different awards and recognition is also indicative of their success as a socially responsible corporation. They have been able to build a brand image for their brews and also built a positive image with their consumers (Sarason and Hanley 2015). They have gained a lot through this venture too. For their efficient ethical, social and environmental responsibilities, NBB was awarded the Environmental Protection Agency’s regional Environment Achievement Award. This form of recognition has further motivated them to work for social cause of the community.
Despite their image a socially corporate citizen, they can still take measure to improve their business operations. For example, although NBB mainly use renewable resource for energy consumption, they are also heating up the brewery with natural gas. Secondly, through expansion of their units in different branches, cost of fossil fuel has increased. So they can take steps to open units at a close distance to the existing brewery units. They will also face challenges to regularly keep up with the reputation as corporate citizen. Hence their actions have motivated many other companies to display social advocacy and think about the welfare of the society too.
Conclusion
From the critical analysis of the case study on New Belgium’s engagement in sustainable social responsibility, one can get an idea of the ethical and social responsibilities of a business firm. The whole case on New Belgium Brewery is centered on the theme of sustainable social responsibility and the company is an ideal example of how to execute this responsibility in real world practice. The sustainability and corporate social responsibility principles make a company more innovative, trustworthy and competitive. This can be achieved by efficient integration of financial, environmental and social goals of the company. The activities of NBB is an example of environmental protection, respecting human rights, following ethics, engaging in philanthropic activities, incorporating safe and efficient business practices and building stakeholder relationship. This report gave an idea about the history of New Belgium Brewery and analyzed its effort to carry out corporate social responsibility. Through their investment in energy saving technologies, recycling strategies and green technology, it can be said that NBB has given their best to reduce the impact on environment through their overall operations. The report also gives detail on their level of social concern for the community and the action they have taken to address social issues. This was evident by their philanthropic events and funding events to support the need people in the community. Finally the report also gives justification on why NBB can be considered as a socially responsible organization and provides evidence to consider it as an organization that promotes social and environmental excellence through their business operations.
Reference
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