Canada Goose and CSR Commitments

Canada Goose and Corporate Social Responsibility (CSR) Commitments – Analysis of Healthy Practices, Ethical Considerations, and Stakeholder's Engagement
By
Student's Name
Professor
Course
Date
Table of Contents TOC \o "1-3" \h \z \u 1. Introducing Canada Goose and Stakeholder Engagement PAGEREF _Toc102300671 \h 21.1 Mapping the Situation PAGEREF _Toc102300672 \h 21.2 CSR Issues PAGEREF _Toc102300673 \h 31.3 Engaging with Stakeholders PAGEREF _Toc102300674 \h 41.3.1 Employees PAGEREF _Toc102300675 \h 41.3.2 Customers PAGEREF _Toc102300676 \h 41.3.3 Suppliers/Value Chain Partners PAGEREF _Toc102300677 \h 41.3.4 Investors PAGEREF _Toc102300678 \h 51.3.5 Media PAGEREF _Toc102300679 \h 51.3.6 Excluded Stakeholders PAGEREF _Toc102300680 \h 51.4 Stakeholder’s Classification PAGEREF _Toc102300681 \h 61.4.1 Defining the Principle PAGEREF _Toc102300682 \h 61.4.2 Power PAGEREF _Toc102300683 \h 61.4.3 Legitimacy PAGEREF _Toc102300684 \h 71.4.4 Urgency PAGEREF _Toc102300685 \h 71.5 Prioritizing Stakeholders PAGEREF _Toc102300686 \h 72. Canada Goose’s CSR Strategy – Critical Analysis PAGEREF _Toc102300687 \h 92.1 Historic CSR Strategy PAGEREF _Toc102300688 \h 92.2 Existing CSR Strategy PAGEREF _Toc102300689 \h 112.3 Comparing the CSR Strategy PAGEREF _Toc102300690 \h 133. Recommendations and Conclusion PAGEREF _Toc102300691 \h 144. References PAGEREF _Toc102300692 \h 175. Appendix PAGEREF _Toc102300693 \h 23
1. Introducing Canada Goose and Stakeholder Engagement
1.1 Mapping the Situation
Corporate Social Responsibility (CSR) and sustainable business practices are becoming immense pressure on global organizations. Organizations have mass accessibility to technology, resources, and related factors that compromise sustainability in the long run (Garnelo-Gomez, n.d.). This essay will critically analyze Canada Gooses' stakeholder engagement in relation to the current CSR issue being addressed as well as a critical analysis of the company's strategy. After which, a fully justified conclusion with a personal recommendation of what steps the company should take.
Goose is a Canadian apparel-manufacturing brand that offers luxury coats, gloves, hats, vests, raincoats, snow pants, and connected wearables for winters. The company manufactures apparel for men, women, and children. Goose is headquartered in Toronto, Canada. However, the company has a global market reach, which collectively includes European and Asian markets (Bloomberg, 2022). According to Global Data (2022), Goose has a market capitalization of USD2.4 billion and generated revenue of USD674 million in FY2021. Deni Reiss serves as the company's Chief Executive Officer (CEO). Goose has approximately 3,600 employees in the global talent base that serve different functions of the company. Besides, Canada Goose Holdings Inc. has more than 668 companies in its corporate portfolio, serving different domains of apparel manufacturing, retailing, and processing segments (DNB, 2022). The company has been accused of different CSR issues over the decades. Goose uses coyotes' fur materials in jackets and apparel to deliver the winter-based purpose of the product in the global marketplace.
1.2 CSR Issues
According to Porter and Kramer (2011), the capitalist system is a source of social, economic, and environmental problems worldwide. Freeman (2013) stated that capitalism also introduces innovative process controls and aligns stakeholders for shared benefits in this context. Businesses propose innovative solutions to address the problems and become change-makers (Garnelo-Gomez and Lawal, n.d.). Progressive businesses engage in CSR activities through philanthropy, managing externalities, stakeholder orientation, and related characteristics to express responsibility towards the problems (Garnelo-Gomez, n.d.a). However, Goose initially failed to align its material sourcing practices with the CSR characteristics, driving the corporate image to different issues and accusations.
The primary CSR challenge is the material sourcing practice used by Goose. The practice led to protests, email threats, and now recently, physical demonstrations around the world in front of Goose retail stores. Thus presenting a threat to the brand image Goose has been building thought the decades. According to George Lee, a plaintiff in the now-ended lawsuit against Canada goose. "Canada Goose's suppliers use cruel methods that cause strangulation and broken bones to coyotes and other animals who are inadvertently trapped and discarded (George Lee v CGOOSE US, INC., [2020])." These demonstrations have grasped the attention of Canada Goose as well as global organizations such as PETA.
The fundamental CSR issue observed in Goose's business practices is the corporate greenwashing activities. According to Vishwanathan et al. (2020), a company should be socially responsible and meet different expectations of the stakeholders whom environmental issues may influence. Businesses engaged in corporate greenwashing create a false impression of sustainability among the stakeholders (Gacek and McClanahan, 2021). Gacek (2020) argued that Goose greenwashed stakeholders about sustainability practices related to animal trapping methods, making the brand image irrelevant and a social trade-off for the stakeholders, particularly investors and customers. As evidence, Weikle (2021) specified in a report that Goose has been penalized in China for misleading customers about product materials and quality for winter jackets. The company used unethical marketing practices to position its brand in the Chinese market while using unsocial material sourcing practices. The Chinese regulatory fined Goose USD88,202 due to corporate greenwashing practices (Weikle, 2021). The identified CSR issue is a fundamental challenge for the corporate sustainability of Goose while operating in a global marketplace. The company is attracting criticisms from different stakeholders, which collectively requires an immediate transformation in business practices and CSR considerations.
1.3 Engaging with Stakeholders
1.3.1 Employees
Employees are the fundamental stakeholders for Goose. The stakeholders are responsible for ensuring internal functions and production for the company. According to Boguslaw (2021), Goose remained ignorant of the health and safety of its employees during the COVID-19 outbreak. The company failed to provide standard operating procedures (SOPs) to optimize health and safety at the workplace, breaching basic workplace standards. However, Reiss disregarded false allegations and ignorance of health and safety during the pandemic through a press release (Goose, 2020).
1.3.2 Customers
Customers are the most important stakeholders for companies, particularly in the retail sector, to generate profit. However, Goose raised a direct CSR issue by misleading customers. The company engaged in false advertisement practices in China. The action caused a lack of trustworthiness and integrity in the brand image. Goose used unsustainable materials and engaged in corporate greenwashing directly to cause a CSR accusation. The corporate team received no response on the matter (Reuters, 2021). Customers are making frequent brand switches, resulting in poor stakeholder engagement for Goose.
1.3.3 Suppliers/Value Chain Partners
According to the market reports, Goose has weak engagement with local and international suppliers. Rastello (2021) stated that the company is experiencing supply chain bottlenecks due to the continuous purchase of unsustainable raw materials to meet market demands. Bain (2019) further claimed that Goose does not limit suppliers from unethical treatments of animals, namely coyotes, while trimming fur for jackets and other apparel. The Supplier's Code of Conduct emphasizes ethical and transparent functions (Goose, 2020a). However, market reports are allegedly claiming value chain violations.
1.3.4 Investors
Goose maintains strong engagement with the investors. Investors' confidence is essential for Goose to receive funds for expansion and other business activities. Goose would make necessary alterations in the business model to retain investors' confidence as a stakeholder. According to Rastello (2021a), the pandemic situation influenced business viability for the global retail industry due to lockdowns and related paradigm shifts in the operational controls. Goose adopted a cost-minimization approach by eliminating third-party engagement in the channel and performing direct sales. The decision plunged the share prices and maintained investors' confidence (Rastello, 2021a).
1.3.5 Media
Relationships or stakeholder engagement with the media remains volatile for Goose. Goose's business model attracts frequent sustainability and ethical violations, allowing the media to respond aggressively. Goose's recent footwear campaign attracted negative media responses due to non-compliance with ethical standards in raw materials. The company attempted to keep the message nature-oriented. However, the media remained aggressive and criticized fur procurement practices (PRN, 2021).
1.3.6 Excluded Stakeholders
* First, the trade unions are excluded from the stakeholder's engagement for Goose. Trade unions are self-oriented and capture weak scope in the CSR issues. No direct relationship is observed between Goose and trade unions.
* Second, the competitors are trend-driven stakeholders for the company. Competitors would alter their standards based to capture market share, which mitigates the scope of CSR issues focused on Goose.
* Lastly, partners are profit-driven stakeholders for the company. Partners reflect indirect interests toward CSR practices based on shifts in market returns.
1.4 Stakeholder's Classification
1.4.1 Defining the Principle
Mitchell et al. (1997) proposed the stakeholder's analysis framework, which helps organizations identify, prioritize, and examine the influence of stakeholders on business decisions. The framework defines stakeholders as the group and individuals that could influence or alter the business decisions in the long run. According to Garnelo-Gomez (n.d.b), stakeholders, directly and indirectly, influence businesses. The proposed framework categorizes stakeholders based on power, legitimacy, and Urgency. Businesses would prioritize stakeholders based on the identified categories to manage risks and ethical standards accordingly.
1.4.2 power
Wood, Mitchell, Agle, and Bryan (2021) discussed the first parameter, namely power. Power is the degree of influence that stakeholders could invest in altering business objectives and decisions in the short and long run. Power also defines the capacity to influence businesses to perform necessary actions desired by the stakeholders for effective management. Stakeholders could use power through coercion, utilitarian, or normative approaches that could influence the operational viability of businesses during a fiscal period (Wood et al., 2021). Power is a notable parameter for stakeholders' engagement in business activities.
1.4.3 Legitimacy
Legitimacy is the second parameter defined in the stakeholders' framework. According to Mitchell, Agle, and Wood (1997), legitimacy is measured based on the relevance of a stakeholder in business objectives and decisions. The attribute confirms that actions should be socially acceptable and align with behaviors. Legitimacy defines risks for stakeholders involved in business decisions. For instance, misleading information produced by Goose is compromising the interests and purchase trusts of customers, making them legitimate towards marketing actions. Businesses must align objectives and SOPs to meet stakeholders' legitimacy and mitigate consequences in the long run.
1.4.4 Urgency
Urgency refers to immediate responses made by businesses to address the stakeholder's requirements. Urgency incurs when the relationship between businesses and stakeholders is time-sensitive or poses immense risks for one of the parties. The influence of stakeholders allows businesses to make robust responses through revised strategies and changes in action plans to mitigate risks. Businesses usually respond to urgencies through a crisis management plan, which keeps resource efficacy sustainable in the long run (Mitchell, Agle, and Wood, 1997).
1.5 Prioritizing Stakeholders
1 Dormant Stakeholders (Power) – This group contains power but lacks legitimacy and Urgency to influence the business objectives (Mitchell et al., 1997). As denoted in Figure 1, Employees at Goose are dormant stakeholders. They hold power to influence the business functions by protesting against false actions.
2 Discretionary Stakeholders (Legitimacy) – This group has no power or Urgency over the business objectives. However, the group influence behaviors by raising questions about unethical actions (Mitchell et al., 1997). As illustrated in Figure 1, communities have a legitimate influence on Goose's actions. The legitimate response would alter the business practices of the company.
3 Demanding Stakeholders (Urgency) – This group summons immediate response from businesses towards an issue. Businesses would require making necessary responses in minimal lead time to avoid consequences (Wood, Mitchell, Agle, and Bryan, 2021). As found in Figure 1, regulatory authorities and government bodies are the demanding stakeholders. The Goose must address the violations and make necessary compliances to avoid penalizations.
4 Dominant Stakeholders (Power + Legitimacy) – This group is legitimate to influence the behavioral attributes of a company. It has the power to change operational viability in the long run (Wood, Mitchell, Agle, and Bryan, 2021). As denoted in Figure 1, customers are the dominant stakeholders for Goose. Goose could not stay profitable by misleading information since customers could make an immediate brand switch.
5 Dangerous Stakeholders (Power + Urgency) – This group has the power to influence business viability. It demands immediate response measures through actions, revised policies, and strategic measures (Garnelo-Gomez, n.d.b). As illustrated in Figure 1, media is a dangerous stakeholder for Goose. Adverse information could influence share prices and stakeholder sentiments from other categories immediately.
6 Dependent Stakeholders (Legitimacy + Urgency) – This group does not have a direct influence on altering the business decisions. However, the behavioral change is legit and requires immediate response from businesses (Garnelo-Gomez, n.d.b). The public is the dependent stakeholder. The alterations influenced by dominant or dangerous stakeholders on Goose's objectives would benefit their interests.
7 Definitive Stakeholders (Power + Legitimacy + Urgency) – This group has a 360-degree influence on business viability and actions. Businesses would micromanage the interests of definitive stakeholders to mitigate consequences (Garnelo-Gomez, n.d.b). Investors are the primary interests for Goose in this category.
8 Non-Stakeholders (Zero Influence/Interest) – This category has no interests or influences on business decisions. The excluded stakeholders are part of this category since Goose's CSR practices do not influence their actions.
2. Canada Goose's CSR Strategy – Critical Analysis
2.1 Historic CSR Strategy
According to Carmelo-Gomez (n.d.c.), CSR activities engage vital community interests. Companies engage in CSR activities to initiate change for communities and drive a progressive future. However, traditional CSR strategies have 'bolt-on' effects, creating reactive orientation for the communities without direct value contribution (Garnelo-Gomez, n.d.d.). Unfortunately, Goose was following traditional CSR practices, which kept ethical standards and procurement practices unaddressed for the company in the long run. The traditional CSR initiatives disoriented community concerns and held weaker objectives to initiate change.
Goose focused on sustainability measures from environmental and production perspectives. The company made efforts to reduce carbon emissions. The management defined controls to mitigate greenhouse gas (GHG) emissions by reducing wastes and disposing of them in the environment. The company deployed optimized operational controls to maintain carbon neutrality. Goose integrated the environmental parameters into retail stores worldwide to keep processes aligned and effective in the long run. Besides, the traditional CSR initiatives encouraged customers to exhibit responsible consumption while making a purchase decision. The company outsourced 55% of the production activities to reduce accountability toward sustainability standards and environmental compliances (Goose, 2019).
Garnelo-Gomez (n.d.e.) observed that traditional CSR practices intended to mitigate risks during community ...