1. Portfolio Part A1 reflection
Use maximum 100 words to reflect the case study attached in appendix A1. Answer the
question posed therein.
2. Portfolio Part A2 reflection
Use maximum 100 words to reflect the case study attached in appendix A2. Answer the
question posed therein.
3. Portfolio Part A3 reflection
Use maximum 100 words to reflect the case study attached in appendix A3. Answer the
question posed therein.
Portfolio Part B:
4. The green product or service (300 words)
Describe how the offerings of the chosen company focus on sustainability

5. Review of relevant literature (300 words)
Refer to a few key literature sources in order to explain how the selected company may best
pursue sustainability for its offerings.

6. Industry ranking reflection (500 words)
Rank the company relative to its competitors based on sales and based on efforts made to
invest in environmentally sound technology or corporate responsibility.

7T. Reflection on measurable sustainability achievements (800-1000 words)
Section 7T does only apply to Transitional Students / SG6002T. Transitional students must do
this section. All other students please leave this section out

 

ANSWER

Portfolio Part A

Part A1 Reflection

Tesco promises to develop a sustainable supply chain by sourcing meat products directly from farmers. From an ethical theory perspective, it is clear that the company demonstrates ethical responsibility. The company also acts with honesty by ensuring that the products it offers reflect the features described on the pack. This approach also demonstrates ethical responsibility. Integrative theory of CSR also suggests that organizations should work towards the satisfaction of social demands. Tesco attempts to meet the social demands of consumers and farmers by holding itself accountable to sustainability.

Part A2 Reflection

Business partnerships and collaborations enhance the diffusion of sustainable innovations. If a company that manufactures electric cars also offers a complementary asset such as charging station, consumers will be motivated to buy the electric car; hence promoting sustainability by reducing the use of fuel cars. For example, the Car2Go concept which involves car sharing promotes sustainability by reducing the amount of fuel used if each consumer would drive his or her own car. Collaboration enables corporate brands to pool resources together to break traditional barriers and develop sustainable innovations. Partners also merge different capabilities to develop sustainable innovations.

Part A3 Reflection

From the case study, it is clear that the company utilises the concept of closing-the-loop and recycling to reduce waste and produce eco-friendly products by recycling its used computers. The challenges faced in this closed-loop recycling include difficulties in eliminating plastics and lack of cooperation from consumers. The plastics used to make computers are often mixed with other products which make it difficult to be recycled. Furthermore, most plastics cannot be recycled completely because some parts are non-recyclable. Customers are also required to collaborate by sending back their used computers to the manufacturer. However, some customers may neglect this responsibility. The company faces the challenge of convincing customers to collaborate with them in the implementation of this project.

Portfolio Part B

The Green Product – Sustainable Food and Packaging at McDonalds

McDonald’s is an American based multinational corporation dealing with the production and distribution of fast foods around the world. Its sustainability report provides a new business model with sustainability in several areas including food, planet, communities, people, and sourcing. McDonalds works collaboratively with direct suppliers to enhance responsible business throughout the supply chain. The company focuses on the Three E business model which involves three value requirements: environmental responsibility, economic viability, and ethics (McDonald’s, 2010). Sustainability is visible in various activities of the company including packaging, energy, anti-littering, recycling, communications, greening restaurants, greening the workplace, and producing sustainable food.

The anti-littering campaign of the company aims at supporting the company’s environmental responsibility. For example, McDonalds produced a new food carrier in France made up of Croisillon to replace the initial lunchbox carton. This packaging model was accomplished through creative and innovative designs of universities in France. It was also implemented through partnership between HAVI Global Solutions in Europe and Van Genechten Packaging (McDonald’s, 2010). These partnerships and collaborations led to a sustainable packaging technology that has reduced packaging materials by 48.7% while maintaining the functionalities of the previous model. The sustainability outcome is that it has enabled consumers to dispose the packaging materials easily in order to protect the environment against littering.

Sustainable food has also been produced to support the Three E business model. Sustainable food is enhanced through collaboration with supplies worldwide. As part of this partnership approach, McDonalds sourced 100% of its coffee beans in 2007 directly from Rainforest Alliance farms in UK, which are certified for their green coffee production (McDonald’s, 2010). The company selects farms that meet certain certification criteria, including environmental protection, supporting communities, and protecting employee welfare. This green sourcing enables the company to serve sustainable foods in all restaurants and enhance consumer safety and health.

Review of Relevant Literature

The sustainability approach used by McDonalds can be analysed using relevant literature from corporate social responsibility, sustainable innovation and business model innovation. Yang and Rivers (2009) explained corporate social responsibility of multinational corporations using stakeholder and institutional theories.  The authors argue that multinational corporations adapt local corporate social responsibility practices in order to adapt to institutional environments in the host country. McDonald’s demonstrates this approach by partnering with certified farms in UK to serve sustainable food as required by the UK environmental and legal institutions. Yang and Rivers (2009) explain this in terms of stakeholder theory. They suggest that multinational corporations adapt CSR practices in order to gain stakeholder legitimacy. McDonalds can therefore identify the needs of stakeholders in order to innovate sustainable products to meet those needs and obtain legitimacy.

Sustainable innovation is also widely explained in literature. Asongu (2007) argue that organisations which use sustainable policies as part of their production process are always technological leaders because they are always looking for new methods to increase efficiency and reduce environmental impact. Sustainable innovation always enables companies to develop innovative products that create competitive advantage. Asongu (2007) suggests that a company can develop sustainable innovations by identifying sustainability goals such as zero gas emissions, zero injuries and zero illnesses, and then creatively designing innovative products to achieve those goals. McDonald’s already knows its goals for the protection of the environment, communities, people and profits. This knowledge arouses the need to produce innovative products that can enhance sustainability.

Industry Ranking Reflection

Some of the competitors in fast food industry are McDonalds, KFC, Subway, Pizza Hut, and Starbucks ranked in that order. Forbes has ranked McDonald’s at position 1worldwide in terms of presence and sales (Forbes, 2015). The company has 18,710 and restaurants worldwide, and it has provided 90 case studies about its sustainability initiatives in its sustainability report. The company’s CSR and sustainability innovation is the primary reason for its brand loyalty worldwide. Its sales revenue in 2014 was 27.44 billion, which is about 10 billion more than its second competitor KFC.

The second largest competitor is KFC which has 111,798 restaurants worldwide (Forbes, 2015). This brand member of YUM Brands Inc recorded total sales revenue of $19.33 billion. KFC focuses on sustainability by providing healthy foods that are customized to every host country. For example, chicken meat in China is produced in such a way that it meets the required standards in the country. According to Forbes, Subway is growing as the most valuable company in terms of branding. Its sales revenue was $16.45 billion in 2014, and the company operates 10,109 restaurants worldwide (Forbes, 2015). In terms of sustainability, Subway works with farmers and its employees to innovate sustainable food and food packages in order to win customer loyalty. Pizza Hut is another member of YUM Brands Plc. The company operates 5,890 stores worldwide, and it earned $19.8 billion sales revenue in 2014. Lastly, Starbucks is a direct competitor of McDonalds, producing green coffee which goes through a careful production process from the selection of farmers to production of sustainable coffee.

Conclusions

McDonald’s is a leading fast foods retailer in the world with a specific focus on sustainable innovation and corporate social responsibility. Its focus on a Three E model has enabled the company to focus on ethics, environment and economic profits. It is clear that these sustainability efforts have not just protected the environment and communities, but also enabled it to increase its economic profits. McDonald’s expansion worldwide has been supported by the sustainability efforts which have created a large customer base.

 

References List

Asongu, J.J. (2009). Innovation as an Argument for Corporate Social Responsibility. Journal of Business and Public Policy, 1(3), 1-18.

Forbes (2015). Top 10 Global Fast-Food Chains. Accessed August 6, 2015 from http://www.forbes.com/pictures/mlf45ejhgi/5-starbucks-3/

Garriga, E. and Mele, D. (2004). Corporate Social Responsibility Theories: Mapping the Territory. Journal of Business Ethics, 53, 51-71.

McDonalds (2010). Global Best of Green: building a better business through effective environmental practices around the world. Oak Brook, IL: McDonalds

Yang, X. And Rivers, C. (2009). Antecedents of CSR Practices in MNCs’ Subsidiaries: A Stakeholder and Institutional Perspective. Journal of Business Ethics, 86, 155–169