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Corporate Social Responsibility
Transcript of Corporate Social Responsibility
Presentation made by: Orville Seo, Ahnna Kim, Lisha Fei, Enoch Wu, Paul Shon
Brief Info on A&F:
-It was founded in 1892 by “David T, Abercrombie Co”
-The company runs 300 stores
-Offers wide range of items from clothes to personal care
-Main competitors are A&E and Aeropostale
-Poor economic responsibility
-Shares lost more than $650 million dollars in August 2013
-Company stock dropped to $3.02 billion dollars from $3.67 billion dollars
-Yes and No
-A&F signed up for Bangladesh safety plan
-A&F was the second retail store to do this
-A&F violated the law by firing a employee wearing the head scarf
-Participates as a volunteers to help for the great causes
-A&F hosted annual fund raising event, raising over $100,000
-Joined “Room to Read” program
-Built over 765 schools & 7040 libraries
-Donating 2.5 million books
-Funding 6500 scholarships to developing nation
-Donating to hospitals
-Sued A&F for trademark infringement
-Sold T-shirts including the slogan “GTL You Know The Deal”
-This slogan was from a show
-It was sold without the agreement of the use of the slogan
-Swedish multinational retail-clothing company, known for its fast-fashion clothing for men, women, teenagers and children
-Exist in 43 countries and employed around 94,000 people (2011)
-2,629 stores at the end of August 2012.
-Ranked the second largest international clothing retailer
-Production is outsourced to about 800 factories in Europe and Asia
Evaluating Corporate Social Responsibility
-Follows the zone of conviction; economic, legal, ethical and discretionary
-Contributes to the conservation of natural environment
-In 2010-2011, negative reports of CSP. In 2012, much improvement
-Economic responsibility-high profiting sales
-Legal responsibilities-obeying the rules of global government
-Ethical responsibilities-teaching workers in Bangladesh their rights, and more
-Discretionary responsibilities-3.2 mil garments donated to charity, and more
-Environmental actions- made progress in reducing its water and energy use.
-H&M introduced more eco-friendly sustainable products last year
Strategies of Social Corporate Responsibility
“Our vision is that all business operations shall be run in a way that is economically, socially and environmentally sustainable.” – H&M http://about.hm.com/en/About/Sustainability.html
-Accommodative strategies for pursuing corporate social responsibility
-H&M meets its economic profitability responsibilities of a net income of $18.68 billion (2010)
-No issues with the legal laws of international retailers
-Main strategy is to grow whilst maintaining good profitability and control
-Succeed by operating an environmentally, socially and economically sustainable company in the present and future within the company and responsibility by all H&M employees
-Early March 2010, The Independent reported a Bangladeshi sweatshop factory supplying H&M caught fire, killing 21 workers working late to meet a quota.
-August 2011, nearly 300 workers passed out in one week at a Cambodian factory
-The minimum wage in Cambodia is $66 (£42) a month
-On 2 January 2013, The Ecologist reported allegations by Anti-Slavery International that H&M is continuing its association with Daewoo in exploiting child and adult forced labour
-19 May 2013, a textile factory in Phnom Penh, Cambodia collapsed injuring several people
-On 24 January 2012, H&M was reported to have stolen an artist's work, using it on multiple items without consent from the artist.
-An original design from the work of an East Atlanta-based artist, Tori LaConsay
-Originally known as Fashion 21
-Founded in Los Angeles, California 1984
-First Fashion 21 opened on April 21, 1984
-Forever 21’s economic responsibilities are well met
-With 7 different brands, there are over 480 stores, it is located throughout the U.S. and in Canada, Europe, Japan, Korea, and the Philippines
-Sales of $3.4 Billion, very profitable
-Poor legal responsibility
-Laws were broken several times for labour issues
-Has faced several lawsuits regarding fair employment and labour
-Poor ethical responsibility
-Social welfare issues are highly stressed
-Give to Love Love to Give brand encompasses a collection of items where proceeds go to charity
-Give to Love Love to Give has donated over $9.5M worth of money and merchandise donations
-FEED Project's, The Humane Society of the United States (HSUS), Japan Disaster Relief, The American Red Cross, Susan G Komen for the Cure, The Samburu Project, Big Brothers Big Sisters, Starlight Foundation, American Society for the Prevention of Cruelty to Animals (ASPCA)
-Forever 21 is known for its bad reputation regarding labour issues
-November 1998, factory workers that produced clothing for company was called for a store boycott until working conditions and payroll improved
-Has been caught for having “sweatshop conditions” =A shop or factory in which employees work long hours at low wages under poor conditions.
-A recent investigation revealed that Forever 21′s vendors committed “significant violations” of the Fair Labor Standard Act.
-Recently, health insurance issues came up: Forever 21 changed max number of hours, of 29.5 hours a week
-Forever 21 has been sued more than 50 times for allegedly stealing the work of other designers and passing it off as their own
-Has copied: Anna Sui, Diane Von Furstenberg, Betsey Johnson, Trovata, Foley+Corinna, 3.1 Phillip Lim, Feral Childe.
-Gap inc. was founded on the principle of doing business responsibly, honestly and ethically
-Gap is commonly known as Gap inc. or The Gap
-American multicultural clothing and accessories retailer
-Founded by Donald G. Fisher and Doris F. Fisher
-Approximately 135,000 employees and operates 3,076 stores worldwide
Evaluating Corporate Social Responsibility
: High profits, still in recovery phase
: Not perfect but follows the rules of global government
: Excels in the field of ethics. Viewed as a leader in the small, but growing corporate movement to improve conditions for some of the world's most exploited workers
: Participates in community and charitable giving (WWF, The Global Fund, etc.)
: Clean water programs, works to reduce carbon emissions and to fight global warming
-Use of child labour
-Loss of life at Aswad Composite Mills due to fire
-stopped business with 136 factories due to:
industrial hygiene measures
Insufficient access to drinkable water
Verbal and Physical Abuse
-Ongoing efforts to improve labour standards
-Global monitoring system
-Works with stakeholder initiatives and labour unions to create a solution
Green the Gap vs. Gap inc.
Fooey inc. vs. Gap inc.
Zara is a Spanish clothing and accessories brand. It was founded by Amancia Ortega and Rosilia Mera. Ortega is currently the world's third richest man with a net worth of 57 billion US dollars. It is the world's largest apparel retailer and famous for being able to push new products out like no other company. The average time needed for a fashion retailer to develop a new product and on the shelves is about 6 months whereas Zara only needs 2 weeks. This gives Zara a huge advantage because they are able to push numerous new products out every year; approximately 10,000 new products per year.
-Discriminated African-American, Latino, and Asian American applicants and employees
-Refusing to hire workers which were minorities
-When hired they did not receive the desirable position
The company generated 13.79 billion dollars in revenue last year with profits of just over 1 billion. Zara currently has 1,770 stores worldwide. The approach used by Zara of zero advertising gives the company lots of working capital, therefore they are able to constantly open more stores worldwide.
Zara has set itself apart by not relocating its factories to low-cost countries such as: China or India or Indonesia. There are 3 main principles regarding Zara's corporate social responsibility. They are: good faith in relationships with stakeholders and society at large; an ongoing dialogue with the aforementioned stakeholders and social organisations; and, finally, transparency in our business activities generally, and, specifically, in the development of our sustainability strategy.
Although Zara is one of the world's largest retailers and generates billions in revenue, they are still committed to environmental protection and sustainable standards to ensure that resources are used and managed properly. Their environmental policy has 4 main principles:
• 1- We are committed to taking environmental issues into account when planning and carrying out our activities and those of our business partners, and encouraging environmental awareness among employees, suppliers and the public.
• 2- We are committed to compliance with the environmental laws that govern our activities, along with any obligations which may be implemented in the future. We will work hard to prevent pollution and reduce, insofar as possible, the environmental impact of our business.
• 3- Other efforts are geared towards achieving constant improvements to our Management System, to enhance its usefulness and improve on our efficient use of resources.
• 4- We make sure that all of our employees and the public are notified of this policy, establishing open lines of communication with government authorities, local communities and other stakeholders.
Zara outsources it's production to other companies throughout the world. It chooses the world's best manufacturers to produce its merchandise, a highly diversified production chain with most of its manufacturers based and located in Europe which: increases efficiency, is cost effective, is located in the heart of fashion and gives the company flexibility and quickness to keep up with current trends. The company ensures that the standards for product quality, health and safety are met with extraordinary results. 50% of products are made in Spain, 26% in the rest of Europe and 24% of merchandise is manufactured in Asia.
Zara has a CSR department within the company with permanent offices in India. Bangladesh, Turkey, China, Morocco, Brazil, Portugal and Spain. These offices ensure that the merchandise is made with maximum respect for labour standards.
Zara has not been involved in many legal problems although the company has been accused of outsourcing manufacturing to producers who use slave labour and terrorizing their own employees. Reports from 25 store employees said that stores abused employees and used a management style called: management by fear in stores located in Sweden and Europe. The union workers released a statement that Zara promised improvement and would change their management style in these retail locations.
Zara has donated over 2 million dollars to Haiti following the devastating earthquake. It donated through international organizations working in Haiti.