Patagonia CSR
Company PATAGONIA
1. Conduct a critical analysis of the company’s stakeholder engagements in relation to your selected issue. Your analysis should be in two parts (and in total around 1700 words - guideline):
• Mapping the situation (Max 500 words): Introduce the company (briefly) and the CSR issue being studied referencing relevant academic and/or practitioner literatures (you can also include references from news articles).
• Engaging with stakeholders (Guideline - around 1200 words)
o Identifyr elevantstakeholdersforyourchosencompanyinrelationtotheissue
being studied. Reflect on those stakeholders you include and those you do not,
explaining your decisions.
o Considering key stakeholders(choosingbetween5and7fromthoseidentifiedin
the previous point) and drawing upon the Mitchell et al (1997) framework, classify these stakeholders according to the attributes of power, legitimacy and urgency, justifying these placements; and discuss on how these different stakeholders should be prioritised (in terms of power, legitimacy and urgency).
2. Conduct a critical analysis of the company’s CSR strategy, comparing the approach followed at the time when the issue took place/the area of activity was launched (if considering a positive issue) with the approach followed nowadays. This part of the assignment, therefore, should consider two aspects: CSR strategy then and CSR strategy now and should be around 1400 words in total. You are encouraged to draw upon CSR concepts, theories and literature to build and support your answer.
• First, you need to critically analyse what CSR approach/strategy the company was following at the time the issue took place (or the area of activity was launched). You can build your argument around what the company said they were doing (e.g. from
CSR reports), on the approach the company adopted towards their stakeholders (e.g. how they treated them, communicated with them) and on information about the company published at the time (e.g. in the media, academic papers).
• Then you need to critically analyse what CSR approach/strategy they follow nowadays, explaining how (if) the approach has changed/evolved. You need to be critical and, therefore, you need to compare their approach to other approaches available (for instance, if the company follows a traditional CSR approach, compare it with a contemporary CSR approach). Please remember to refer to theory when providing your answer. You can also use examples from other companies.
3. The assignment should conclude with a brief conclusion which includes recommendations (your view on what the company should do in terms of CSR – e.g. what type of CSR approaches/strategies they should start/continue following). Guideline – 400 words. Please refer to theory to support your argument.
PATAGONIA CSR
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Patagonia CSR
Mapping the Situation
Company Background
Patagonia is one of the American companies linked to various CSR aspects. The company produces high-quality garments by considering customer preferences and demands. It has focused on a strong environmental stance that ensures that it retains and satisfies the customers. The company focuses on different initiatives such as product life cycle to assure a significant reputation and growth. Chouinard started Patagonia through mountain climbing in 1957, and the management established the first store in 1973 (Eich, 2021). It is known for its different philanthropic actions and commitment to saving the environment. The company's management stresses that the core actions that determine the company's success is high-quality resources, which result in better outcomes. The two key raw materials that the company considers in most of its operations are wool and down. The down used comes from different geese, thus leading to high-quality products. On the other hand, the major source of wool is Australia which provides high-quality wool at better prices. There are different wool and down principles that the company considers, thus determining the quality of the products that it produces.
Patagonia is driven by its current goals, focusing on productivity and promoting effective corporate social responsibility actions to its stakeholders. It also aims at minimizing different ecological experiences by embracing specific business models and favorable actions (Eich, 2021). Patagonia also aims at increasing natural capital and productivity. One of the aspects that guide the company is its value proposition which promotes sustainability. Sustainability is also the key differentiation that the company considers. Its differentiation strategy allows it to narrow its customers, thus paying premium prices to escalate its growth. Quality, environmental impact, and innovation also allow the company to charge a medium size compared to its competitors leading to a higher competitive advantage. The paper analyzes Patagonia's CSR strategies and recommends the right actions necessary for its growth and sustainability.
CSR Issue
The CSR issue under the study is linked to its environmental sustainability position. Due to the production of dying shirts, the company produces a byproduct that is a key threat to the environment and sustainability (Eich, 2021). Regardless of its attempt to reduce harm, it is still a key CSR issue since it impacts different stakeholders. Therefore, the key discussion is majorly based on the CSR, environment, and marketplace. According to Vishwanathan et al. (2020), a company should be socially responsible and meet different expectations of the stakeholders to whom environmental issues may impact. Generally, Patagonia is known for robust social-responsibility programs and initiatives that effectively sustain the stakeholders, such as communities and workers. CSR is based on four major categories, including economic, ethical, philanthropic, and environmental. A business is deemed successful whenever it considers all the elements. Despite its role in promoting CSR, the company does not successfully consider all the four categories; this leads to extreme sustainability issues.
Engagement with Stakeholders
Stakeholder Identification and Reflection
The stakeholders include customers, suppliers, community, government, employees, and suppliers due to their direct role or huge impact on environmental responsibility and management, a key CSR issue.
Customers
Customers are the key stakeholders of Patagonia Company concerning the CSR issue of environmental challenge and sustainability. The customers are essential for the company since their stake involves service quality and value. Therefore, the company should be responsible for its interests by promoting high standards of environmental management. Any company cannot exist without its customers. Patagonia is a customer-centric company and focuses on suitable responsibilities. The customers are a critical group of stakeholders who determine the success of any business. The more they are satisfied, the more the company retains them, thus determining the growth and success of any business. Therefore, it is the core responsibility of Patagonia to provide eco-friendly products to retain the customers as much as possible. It is also necessary to focus on high quality to ensure that they meet the customers' tastes. The main value that the customers offer to the company is Patagonia. Therefore, it is necessary to focus on suitable elements which would lead to higher growth and development. Lastly, customers must be involved while addressing the CSR issue since pollution affects their contact with the company.
Community
Community is the second group of stakeholders whose interests shape most of the activities of Patagonia. They are external stakeholders but have a huge influence on the corporate social role, especially in production. Community engagement is necessary since they determine the reputation of the company. The company enhances community engagement using different tools. Their engagement should also be proportional to the existing company resources. Therefore, Patagonia, a clothing company, leads to specific pollutions that may adversely impact the community. It is the company's social responsibility to ensure that any action should be in line with the environmental standards. Currently, there are existing issues of environmental degradation from different communities (Barnett et al., 2020). The only way to engage the community is through consistent communication to determine the key interests that would lead to growth and development. The key way in which Patagonia benefits the community is through enhancing environmental responsibility. The company achieves the responsibility by conducting different feasibility studies among the communities, especially those near the production line. Therefore, community engagement is fundamental for the successful growth of the company.
Employees
Employees are a group of internal stakeholders who considerably determine the company affairs since the management directly engages them. There is a direct stake of the employees in the company. They are responsible for earning adequate income that assists them in supporting themselves in other activities effectively. The employees play a key role in Patagonia's CSR issue since they determine whether the company is achieving different goals in line with the expected standards or not. Therefore, employees are necessary for determining the growth of a business by streamlining key company operations. It is also necessary to consider whether the company's actions align with the employees' interests. The two significant interests that the company should consider while engaging the stakeholders are health and safety. It means that the CSR issue impacts the employees since it jeopardizes their safety and security. Therefore, it is necessary to highlight common elements that are likely to promote the employees' interests and preferences, such as a secure working environment and high job satisfaction. It is also necessary to limit activities that may jeopardize the working environment of the employees, such as insecure jobs and poorly managed business environment, which would lead to employee dissatisfaction (Baskentli et al., 2019).
Suppliers
Suppliers play a key role when it comes to company productivity. They are responsible for determining whether company materials increase or decrease depending on the quality of the raw materials. For instance, the key raw materials for Patagonia company are wool and down. The identified raw materials comprise a byproduct that jeopardizes the environment of environmental safety. Therefore, it is the critical social responsibility of the company to engage the stakeholders and specifically focus on quality production. According to Morsing and Spence (2019), engagement of the suppliers is necessary by upholding their health and security. Therefore, the suppliers streamline the CSR.
Government
The government is responsible for different law-related issues that may impact innocent citizens. Based on the identified CSR issue, the government determines the legal actions among the environmental perpetrators. The government also plays a role in streamlining the company towards achieving its legal objectives. For instance, the legal objective of Patagonia is to provide clothing to the customers within the environmental standards that the government advocate for. Whenever the company goes below the identified standards, it would negatively impact other stakeholders such as the customers and customers. Therefore, the government is a type of external stakeholder that influences the company's actions towards sustainability and growth.
Lastly, the two types of stakeholders not included are investors and trade associations. The reason for not including the investors and trade associations is due to their fi...