The term corporate social responsibility is a business approach which business organisations pursue to ensure welfare of the environment besides earning profits. Tai and Chuang (2014) in their work define corporate social responsibility as the responsibility which demands the commercial organisations to operate as responsible citizens and not only mere profit making tools. They highlight that corporate social responsibility encompasses benefiting stakeholders of the business organisation in order to ensure long term sustainability of the corporate organisations. Visser (2010) in his work titled ‘The age of responsibility: CSR 2.0 and the new DNA of business’ mentions the concept of CSR 2.0 which stands on the concept of CSR 1.0 which business organisations undertook largely to achieve their own goals like supporting start-up firms only the acquire the later at a future stage. The fifteenth page of the work mentions that CSR 2.0 stands on ‘common partnerships’ and ‘stakeholder involvement’. The model advocates transparent CSR reporting and governance by multiple stakeholder panels. The model further goes on to mentions that CSR 2.0 requires business corporations to empower their subsidiaries to take CSR initiatives. It can be pointed out that while the CSR reporting and stakeholder governance applies to all the business organisations, the shift from central CSR to decentralised CSR is more applicable for multinational corporations. The five principles of CSR 2.0 are creativity, scalability, responsiveness, glocality and circularity. Tim Hortons is a Canada based international chain of coffee restaurants owned by the Restaurant Brand International (Rbi.com, 2018). The paper would explore the concept of CSR 2.0 and its application at the Tim Hortons including the five principles CSR 2.0.
The Time Hortons is a Canadian chain of restaurant which started its journey in 1960s founded by Tim Horton, a hockey legend and opened the first store in Hamilton, a port in Ontraio, Canada. The firm then a sole proprietorship firm, partnered with its first franchisee, Roy Joyce. The restaurant introduced but sized snacks food format in 1976 and in 1977 Tim Hortons opened its first outlet in Quebec, Canada. The Canadian restaurant chain offered muffins and cookies in 1981 and croissants in 1983. The restaurant entered the United States in 1984, thus graduating into a multinational firm. Tims added soaps to the product line in 1985 and in 1986, the restaurant offered a promotional tactic called ‘Roll Up the Rim’ which turned out to successful. The restaurant by 1990s had emerged into a famous Canadian restaurant chain and opened its 500th restaurant outlet in Quebec. The chain marked the opening of its 1000th outlet in Ontario, Canada. Tom Hortons in 1995. The restaurant chain in the same year merged with Wendy’s International which enabled the brand to get a stronger foothold in the United States of America. The restaurant chain expanded further to touch 2000 outlets bench in 2000 and carried out its first initial public offering, thus marking the transformation of the chain into a public limited company. The public limited restaurant chain offered co-branded Double Visa Card which were redeemable while in 2014 the restaurant introduced online mobile payment facility. Burger King and 3G Capital acquired Tim Hortons to form Restaurant Brand International, the third largest brand in the restaurant industry. Tim Hortons retains its individual identity status and retains its own official website (Rbi.com, 2018) (Appendix 1).
An analysis of the timeline of Tim Hortons discussed above since inception shows that the Canadian restaurant chain has achieved its goals. Firstly, the excerpt shown above shows that the restaurant chain has achieved a sales of $ 6716.9 million in 2017 which was $ 6405.2 in 2016. This shows that the restaurant chain has experienced commendable growth in revenue generation (Timhortons.com, 2018).
An analysis of the sustainability report 2017 published by Restaurant Brands International, the owner of Tim Hortons shows that the organisation is monitoring its utilisation of forest resources in order to reduce destruction of forests. The company is further aiming to eliminate destruction of forests which means it has partly succeeded in achieving its sustainability efforts. The analysis of the business growth of the Tim Hortons shows that the company has succeeded in achieving its sustainability and profit aims partially. The restaurant chain is collaborating with coffee growing communities to improve their productivity and returns the small scale coffee farmers get by selling coffee beans. It can be pointed out out from the discussion that the Tim Hortons has taken up several CSR activities as a part of its core business strategy. However, the restaurant chains should take (Kleine, 2014)
The corporate social responsibility initiatives of the Tim Hortons make the Canadian chain unique in the restaurant industry. This is evident from the analysis of the sustainability initiatives of the restaurant which encompasses a wide area right from supporting children development efforts to collaborating with local coffee growers. The Horton Children’s Foundation, the child development CSR arm of the Tim Hortons hold camps. The aim of these children’s camp is to create awareness among children about the necessity of conserving the environment. The Horton Children’s Foundation employs employees in different capacities like wellness, food services and camp management. Jamali and Karam (2018) mention in this regard that this employment generation functions of CSR activities is a new area of study and is drawing interests from CSR experts. It can be mentioned in this respect that this initiative of the Tim Hortons makes it unique within the restaurant industry. This is because this initiative creates environmental awareness among the children and employment opportunities among the local population.
The second CSR initiative of the Tim Hortons is the Tim Hortons Coffee Partnership lends uniqueness to the corporate social responsibility of the Canadian restaurant chain. Farooq, Rupp and Farooq (2017) mention that corporate organisations are responsible for benefitting the local communities and grass root level suppliers, the farmers who provides them with raw materials. The partnership of the Tim Hortons with coffee farming communities in four countries namely, Brazil, Colombuia, Guetamala and Honduras. This initiative of the restaurant chain educates farmers to adjust their cultivation pattern with the changing patterns of the market.
An analysis of the two CSR initiatives of the Tim Hortons shows that the first initiative is more unique compared to the second initiative. This is because the children’s camp initiative is unique to the restaurant chain. However, the initiative of supporting coffee farmers is practiced by several multinational companies which makes the initiative less unique. For example, Nestle, the largest food manufacturer works to improve economic conditions of farmers and on a global scale, compared to four countries which is undertaken by the Tim Hortons (Nestle.com, 2018).
The corporate social initiatives of the Tim Hortons are creative, scalable, responsive, glocal and circular thus qualify the five principles of CSR 2.0 theory proposed by Visser (2010). The first principle of CSR 2.0 is creativity which business corporations achieve by the virtue of their innovative power. Anderson, Poto?nik and Zhou (2014) mentions that financial strength of multinational corporations attribute it with material, technological and manpower to carry out innovation in their business operations. This is evident from the innovative packaging system the Canadian coffee has adopted to benefit its environment. The restaurant in order to reduce its waste generation and environmental impact has introduced lids with double layers for beverages it serves. This enables it to recycle the lids and reduce the amount of waste it sends for disposal. Similarly, using recycling materials to make packages also provide testimony to the capability of the restaurant chain to benefit environment by adopting creative business ideas (Timhortons.com, 2018). Thus, it can be inferred from the discussion that the restaurant qualifies the first principle of CSR 2.0 which is creativity.
An analysis of the corporate social responsibility of the Tim Hortons shows that the multinational restaurant chain qualifies the second principle of CSR 2.0 which is scalability. Visser (2016) opines that corporate organisations indulge in large scale community development projects as a part of their CSR but it is difficult to quantify or scale their initiatives. Vallström, Lindholm and AbuBakr (2017) support this opinion by scalability is an important aspect in measuring the actual benefit of the CSR initiatives taken by the companies. The CSR reports of the Tim Hortons show that the company measures the actual benefit of its CSR initiatives on the yardstick of three key performance indicators namely, economic, social and environmental outcomes. For example, the company measures total coffee production by the farmers by taking into account average yields of coffee and cost of production. The firm takes into account the total revenue generated by the farmers at the grass root level working under the community development program of the firm. Similarly, the company measures the social impact by the community development programs by measuring the number of farmers participating in the coffee farmers’ development programs. Similarly, the restaurant takes into account the areas of land under the sustainable coffee farm management (Timhortons.com, 2018). It can inferred from the analysis that the Tim Hortons qualifies on the parameters of scalability, the second principle of CSR 2.0 proposed by Visser (2010).
The Tim Hortons qualifies the third principle of CSR 2.0 which is responsive. This can be pointed out that the firm has responded to the changing scenarios in the macroeconomic environment. This is evident from the business decisions of the management of the Tim Hortons. The Tim Hortons has developed a robust environment friendly strategy which forms a part of its core business operations, thus showing the responsiveness of the café chain. The management has adopted methods like reducing wastes by recycling hot beverage cups and partnering with waste management experts. These experts enable the café to recognise in areas in which it is required to reduce wastes. In fact the company has collaborated with municipal bodies and NGOs like Stewardship Ontario to exhibit as well as encourage recycling of hot beverage cups (Rbi.com, 2018). This decision enabled the firm to exhibit its responsive by integrating TBL as a part of its core business process. However, the restaurant maintained its independent status as well as Canadian origin, in order to retain its customer base. This analysis shows that the restaurant is responsive to the market trends and change its identity (partnership to public limited) (Filatotchev, Bell & Rasheed, 2016).
The Tim Hortons qualifies the fourth pillar of CSR 2.0, glocality which is an amalgamation of the words global and locality but to a lesser extent in comparison to the first three principles. An analysis of the market segmentation of the restaurant chain shows that the firm segments its market geographically namely, Canada, its home country and the United States. Marsden and Arce (2017) opines that firms have to adjust their international business strategies to the local market conditions like customer preferences in order to succeed in the local markets or host countries. It can be pointed out that according to this opinion it can adjudged that the Tim Horton qualifies in the fourth principle, glocality. However, going by the Hofstede’s tool it can be pointed that the social conditions of the US and Canada are almost similar (Appendix 2). The competitors of the Tim Hortons like Starbucks are present in multiple markets like the US and China, each having their specific market conditions. Thus, in the light of this fact the glocal status of the Tim Hortons cannot be questioned but it cannot be fully appreciated (De Villa, Rajwani & Lawton, 2015). This is due to the presence of the restaurant chain in only two countries which share similar market conditions. Thus, the restaurant chain qualifies the glocality principle to a far lesser extent compared to the previous three principles.
The Tim Hortons’s qualification of the fifth principle, circularity cannot be sufficed to a sufficient extent. Visser (2010) mentions that as per CSR 2.0 circularity is a cyclical process in which business organisation recycle their wastes to make them fit for use or use them in some other productivity. For example, a factory recycles the waste water to reuse it again. It can be pointed out in this light that the official website of the Tim Hortons does not mention any such waste management measures. It can be pointed out again that the holding company, Restaurant Brands International (RBI) however does mention waste management and recycling. However, considering the fact that the official website of the Tim Hortons does mention the CSR activities like community development and children awareness camps but not recycling of wastes, the qualification of the restaurant on the scale of circularity remains inconclusive. Thus, it can be inferred that the application of circularity principle at the Tim Hortons cannot be proven strongly.
There are several facts which makes the Tim Hortons a business worth interest in becoming a responsible company. The first fact which makes the business interesting is that the firm in spite of being a subsidiary to RBI, has maintained its own market identity which is evident from its individual official websites as well as product line (Timhortons.com, 2018). Secondly, the restaurant chain has an extensive CSR strategy which encompasses recycling of waste products, reusing of wastes to manufacture packing, protection of bio reserves and empowerment of coffee farmers. These CSR strategies of the Tim Hortons shows that it a highly responsible towards the environment. However, the position of being the leader in the market is held by Starbucks with presence of over 20000 locations globally against a mere 4300 location which the Tim Hortons boasts (Starbucks.com, 2018). The development of a cyclical process by the Tim Hortons cannot be proved strongly since the official website remains silent on the matter. However, the official website of the restaurant does mention that it is heading towards a net zero footprint objective. This is evident from the official website of the coffee chain which clearly mentions that the firm engages in preserving the Trifinio ecosystem in El Salvador, Guatemala and Honduras. Thus, this a strong evidence to prove that the Tim Hortons is moving towards net-zero footprint by encouraging afforestation. Similarly, by supporting local coffee farmers the firm is assisting to improve their income and economic conditions. Thus, it can be pointed out that the Tim Hortons besides reducing its carbon footprint is also promoting reduction of inequality by promoting economic development of the coffee farmers.
Conclusion:
It can be concluded from the discussion that the CSR strategies of the Tim Hortons are not satisfactory. This can be proved from the fact that the firm qualifies on the parameters of creativity, scalability and responsiveness. However, the firm shows poor performance on the principle of glocality while fails on the parameter of circularity of CSR 2.0. The scope of the research was limited to the Tim Hortons and its owner company RBI, however, considering the fact that former retains its independent market identity as well as an individual official website, the evidences from the website of the Tim Hortons gained precedence over that of RBI while drawing inferences. Moreover, the presence of the Tim Hortons in only one host country namely, the US and its CSR encompassing only four countries, it can be concluded its CSR credentials are weak. The business area and revenue generation capability is also limited to two countries which is very weak before the market leaders, the Starbucks boasting a true glocal presence. This shortcomings of the company necessitates two recommendations to the management of the Tim Hortons. First, it can be recommended that the Tim Hortons should enter new markets like Europe and Asia, which are culturally diverse. This would enable the restaurant chain to strengthen its glocality. Secondly, the company should launch a waste recycling project in all its locations which would enable it to qualify the fifth parameter of CSR 2.0.
References:
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