Economic Responsibility of Hershey Company for CSR- myassignmenthelp

Question: Discuss about theEconomic Responsibility of Hershey Company for CSR. Answer: Introduction Economic Social Responsibility can be defined as ensuring that a company attains economic profitability for itself and ensuring that there are economic benefits in the communities it has its various business activities. Clark Maurice, (1916) contributed that economic responsibility from the social stand-point isnt basically concerned with the self-reliance and self-dependence but with interdependency. Many companies today have stressed so much on practicing corporate social responsibility as it has more social benefits than costs. This paper evaluates the economic responsibility of Hershey Company and the benefits the company has accrued from practicing CSR. Economic Responsibility of Hershey Company According to Hershey Company, (2016, p.5), in order to achieve a successful business, theres need to have a responsibility model that ensures theres a positive impact of the companys business operations in its communities. They have stated in their CSR policy that they have a culture of producing high quality products that are environmentally sustainable. The company publishes report on progress of its CSR each year on its website. In the companys annual report in fiscal year 2016, in regard to the economical social responsibility, its noted that one of efforts of the company is to ensure theres increased investments in the communities it operates in. As per the definition of economical responsibility described above, this is one of the essential parts whereby the company ensures theres increased economical activity in the communities where it carries out its business activities. In the most recent published CSR report for the fiscal year 2015, Hershey Company, (2016, p.2) states tha t they have a well structured growth to ensure that the companys brand gain customer loyalty. They have been forced to make certain adjustments in recognition of the changes in the economy in most parts especially in Asia so that the company can continue being profitable. One of these changes included reorganization. Fair Trade Practices of Hershey Company As one of the factors that determine the effectiveness of economic responsibility, Hershey Company has over the years practiced fair trade. The company had presented that increasing prices may not be the best solution to absorbing the possible high costs of materials and energy. By increasing the selling prices, the cost may be reduced but the customers purchasing power decreases which would result in decreased sales volume. Theres therefore emphasis on strategic pricing and fair trade. The company founded that it operates in a very competitive market and the best thing they do in order to compete well is to enhance product development. (Hershey Company, 2016. P. 7) A company thats very much concerned with increasing profitability, ensuring fair trade practices, achieving consumer purchasing power and value may be said to be practicing a well structured economic responsibility. Shahzad and Sillanp, (2013) argued that corporate social responsibility includes making a company economically profitable. They further argued that fair trade practices help the company support the producers (farmers in this case), and in raising awareness for going global. It enables the company ensure that the farmers, suppliers and the employees in this case have attained high economic self-sufficiency. The firm is also able to improve the working and living standards of its workers. As for the consumers, it ensures that they are able to get the various product they need and in fair prices. (p. 240). This is what the Hershey Company has practices over the years and it has benefited the company through improved public image. Responsible Sourcing of Hershey Company In order to ensure successful economic benefits, the company has further ensured that the products meet the needs of the consumer and ensure that the living standards of the farmers and suppliers are improved. In order to be economically responsible, a company has to take into consideration the economic wellness of the suppliers and producers of its raw materials. This is referred to as responsible sourcing. The company under this strategy has influenced improved infrastructure for the farmers, development of support programs to enhance the livelihoods of the supplier and farmers, and provided primary education and training for the children and farmers respectively. Hershey Company has had great efforts in promoting the Cocoa farming in Mexico with a motive of improving the economic wellness of the community and this has impacted greatly on the lives of the farmers and suppliers of the product. According to Chorn et al. (2010) economic responsibility aim to increase economic value fo r all stakeholders involved in bringing products and services to market. (p. 2) From the economic part of it, it can be observed that Hershey Company is one of the companies that lay much emphasis on the social economic impacts of its strategies. In the companys annual report 2016, one of the greatest challenges is the economic changes. Hershey Company, (2016) maintains that economic market conditions are a threat to the financial performance of the firm. In order to overcome this challenge, the company has therefore over the years strived to build social and economic development initiatives that benefit both the consumers, suppliers, employees, and other stakeholders. Benefits of Sustainable Economic Responsibility to Hershey Company As reported by Business Wire, (2013) the Hershey Company had been recognized as one of the top 100 companies in America that has achieved high corporate social responsibility. Some of the benefits that the company has enjoyed as a result include maintaining of highly skilled workforce, increasing its profitability, customer loyalty has been enhanced greatly, it has achieved a good public image, and it has improved the shareholders value. One of the motives behind practicing economic responsibility is to ensure profit maximization. In addition to this, it can also be argued that economic responsibility does have benefits that outweigh the costs. McWilliams et al, (2006, p. 9) argues that the social economic benefits can exceed the costs of the firm. Its can be further argued that economic responsibility reduces the conflict of interest in that the managers of a company like those of Hershey Company are more concerned with increasing profitability to achieve high shareholder value rather than doing things for their own economic-interests. Schreck, (2009) justify that the economic conflict of interest is lowered as managers see the economic benefits of the CSR to the shareholders and would not worry about the possible costs of CSR on the shareholders value. It can be noted in the case of Hershey Company that the firm is in a good financial and profitability condition. Conclusion Economical Social Responsibility for Hershey Company has proved to have benefited the company greatly. In general, Hershey Companys CSR has taken the company into the height of being recognized as one of the best companies that has a good practice of CSR. The profitability of the company as well as the public image of the firm has been greatly impacted. The paper founded that the benefits of economic responsibility of Hershey Company outweighs the costs. References Business Wire. (2013). The Hershey Company recognized as one of Americas 100 bestcorporate citizens. Retrieved from https://www.businesswire.com/news/home/20130412005450/en/Hershey-Company-Recognized-America%E2%80%99s-%E2%80%98100-Corporate-Citizens%E2%80%99 Chorn, B., Sisco, C., Pruzan-Jorgensen, P.M. (2010). The business case for supply chain sustainability. BSR. Clark, M. (1916). The changing basis of economic responsibility: Journal of Political Economy. 24, 3, pp. 2009-229. Hershey Company, (2016). The Hershey Company annual report. Retrieved from https://www.annualreports.com/Company/hershey-co Hershey Company, (2016). 2015 corporate social responsibility report. Retrieved from https://www.thehersheycompany.com/en_us/responsibility.html McWilliams, A., Siegel, D.S., Wright, P.M. (2006). Corporate social responsibility:Strategic implications; Journal of Management Studies. 43, 1, pp. 1-18. Schreck, P. (2009). The economic impact of social responsibility; The business case for corporate social responsibility. Heidelberg; Germany: Physica-verla. Shahzad, K., Sillanp, I. (2013). The role of fair trade in developing corporate social responsibility: An empirical examination based on multiple cases. Phuket; Thailand