3. Methods
The purpose of this paper is to obtain knowledge about CSR and to analyze the CSR program at Deutsche Post DHL critically.
Therefore, I will illustrate how Deutsche Post DHL presents its CSR program. I intend to point out the three main focus areas – environment, disaster management and education, rather than focusing on individual projects. Additionally, this part will give a summary of the positive and negative critique of the CSR program at Deutsche Post DHL. With these critiques, one will be able to prove the reliability of the CSR program at Deutsche Post DHL.
In the second section, I will focus on the conflict between the stakeholders and the shareholders perspective. Furthermore, I will give an overview of the different elements in Corporate Social Performance: social responsibility, social responsiveness and social issues. Subsequently to the theory, the report will demonstrate how Deutsche Post DHL implemented the theory. Additionally, the report aims to show Deutsche Post DHL’s level of CSP.
After the CSR debates, the report will introduce the morale ideas of Aristotle and how the Deutsche Post DHL’s CSR program bases on these ideas. Due to the word limit, this report will not include other morale foundations such as Machiavelli, Rousseau or Locke.
The last part will summarize the results before there will be a final conclusion.
4. How does Deutsche Post DHL present its CSR program?
In 2006, Deutsche Post DHL introduced a code of conduct which is compulsory in all regions and all departments. “The key pillars of this code of conduct are respect, tolerance, honesty and candor as well as willingness to assume social responsibility. The guidelines apply to all employees, irrespective of their place in the Group's hierarchy, and to divisions” (Deutsche Post DHL, 2010).
Additionally, Deutsche Post DHL has chosen “Living Responsibility” (Sustainability Report, 2009) as its motto, which ought to symbolize its variety of initiatives in the areas of environmental protection, disaster management and education. “They are designed to increase the employees’ motivation and their identification with the company as well as to make the group more well-known and respected and to improve its competitive position” (Annual Report, 2009).
4.1. Environmental Protection - Go Green
In 2008, Deutsche Post DHL initiated its ambitious GoGreen climate protection program. The company’s goal is to “reduce CO2 emissions for every letter and parcel sent, every tonne of cargo transported and for every square meter of warehouse space used by 30% by 2020 (compared to our 2007 baseline)” (Deutsche Post DHL, 2010).
Since the transport-related CO2 emissions are determined and offset through internal reduction measures and external climate protection projects, Deutsche Post DHL became the first logistics company offering carbon neutral packages. Furthermore, the company invented a pilot project with new transporters which are using less fuel and alternatives to fossil fuels (cf. Deutsche Post DHL, 2010).
4.2. Disaster Management - Go Help
Due to comprehensive expertise in logistics and the high profile worldwide, Deutsche Post DHL is well prepared for helping at natural disasters. Deutsche Post DHL’s support focuses on two core areas: Logistics support after natural disasters and disaster preparedness.
Primarily, the task of DHL Disaster Response Teams (DRT) is to eliminate shortages in the disaster area. For that reason, trained logistic experts are going into the affected areas and to the airports respectively in order to coordinate activities. These experts see to it that the transport of substantial relief goods such as food, medicine and sanitary articles is ongoing – even if there is no infrastructure (cf. Deutsche Post DHL, 2010).
After these teams are requested by the UN-Office for the Coordination of Humanitarian Affairs (OCHA), they are ready for action within 72 hours. There are three teams, which form a network covering almost all regions in the world that are affected by natural disasters on a regular basis.
Furthermore, Deutsche Post DHL supports locals, who are responsible for disaster preparedness. For optimal trainings, Deutsche Post DHL cooperates with the United Nations Development Program (UNDP). Together they invented the program Get Airports Ready for Disaster (GARD), which prepares airports to handle the flow of incoming relief goods (cf. Deutsche Post DHL, 2010).
4.3. Education Programs - Go Teach
Alongside the focus areas environment and disaster management, education is the third focus area at Deutsche Post DHL. The company believes that “Education is key to our children's future and our own success as the world's leading logistics company and one of the largest employers worldwide” (Deutsche Post DHL, 2010). Therefore, Deutsche Post DHL is cooperating with Teach First Deutschland in Germany.
Teach First Deutschland is an initiative launched in 2009. By working in a secondary school for two years as Fellows, outstanding university graduates help to ensure that even children and youths with fewer opportunities get a chance to move up. (cf. Teach First, 2010).
Additionally, Deutsche Post DHL wants to encourage its engagements in education all over the world.
5. How does the environment respond to Deutsche Post DHL’s CSR Program?
During the past years, Deutsche Post DHL obtained awards and positive critique as well as negative critique for its CSR program and its efforts.
5.1. Awards and positive critique
In 2008, Deutsche Post DHL has been rated as the best performer in the logistics and transportation sector by Climate Counts, which is a non-profit organization rating corporations on their efforts towards justifying climate change (cf. Climate Counts, 2010). “Climate Counts has found that [Deutsche Post DHL] has established clear and absolute goals to reduce the greenhouse gas emissions, with oversight on climate action at the highest level in the company” (Climate Counts, 2010). Therefore, the company got 67 out of 100 points in an overall evaluation.
Furthermore, Deutsche Post DHL won the Leo-Award in the category “People of the Year” for its Disaster Response Teams in 2008. The prize is awarded by the DVZ Deutsche Logistik Zeitung (cf. DVZ, 2008).
Due to “the company's readiness to assume economic, ecologic and social responsibility with a particular emphasis on the companies’ climate protection Program GoGreen”, Deutsche Post DHL received the German Sustainability Award for the most sustainable strategy. (Deutscher Nachhaltigkeitspreis, 2010). The award is an initiative of the German Sustainability Awards Foundation in cooperation with the Federal Government, the German Council for Sustainable Development, trade associations, NGOs, and research facilities. The prize aims to persuade companies to operate sustainably and help to raise awareness of the principles of sustainable development (cf. Deutscher Nachhaltigkeitspreis, 2010).
5.2. Negative critique
Rettet den Regenwald (2009), an environmental organization in Germany, criticizes Deutsche Post DHL for using ten transporters that consume palm-oil. Deutsche Post DHL is using these transporters in order to minimize CO2 emissions and to reach their goals within the GoGreen project.
According to calculations by the organization, the transporters will cover a distance of ca. 3.3 million kilometers which equals a 700,000 liter palm-oil consume (cf. Rettet den Regenwald, 2009). The palm-oil is produced in Southeast Asia where rain forests are deforested in order to build up palm-oil plantations. For a compensation of the CO2 produced during the cut-and-burn, it would be necessary to use each plantation for at least 423 years (cf. Rettet den Regenwald, 2009). Thus, it would be less damaging for the environment, if Deutsche Post DHL used normal transporters.
6. Corporate Social Responsibility Debates
Firstly, the discrepancy between the shareholder’s and the stakeholder’s perspective will be explained and illustrated through Deutsche Post DHL’s CSR program. Afterwards, the different elements of CSP will be clarified.
6.1. Shareholders vs. Stakeholders
CSR can be are divided into two general perspectives: the shareholder’s and the stakeholder’s perspective.
From the shareholder’s perspective, corporate social responsibilities are considered to be solitary towards the company’s shareholders. This means that the only responsibility for a company is to make profit to its owners, meaning profit maximization. One of the most famous promoters of this perspective is Milton Friedman, who won the Nobel Prize in 1976. He has proposed that companies are only responsible to their shareholders (Friedman M., 1970). Adam Smith, the founder of the classical economical theory, supports these beliefs as well. Smith has argued that an efficient market mechanism will guarantee that beneficial activities for a company are also good for the society. According to this point of view, the society determines its demands through the market and then the companies act in response to those demands (cf. Carroll A., 1996, pp. 29–32).
The stakeholder’s perspective highlights the bonds between the companies and the society.
According to this idea morale should be involved in company’s decision making. The main obligation for the company is defined as securing the long-term profits and growth, which requires a socially responsible way of action. (cf. Herchen O., 2007, p.11.)
At the present time, the stakeholder’s perspective seems to be the most approved idea. Stakeholders are defined as “any group or individual who can affect or is affected by the achievement of the firm’s objectives” (Freeman E., 1984, p. 25).
According to the stakeholder perspective of CSR, a company has to perform responsibly against all its stakeholders. For example, the company has to treat its employees accurately, obey the laws given by the government, act ecologically enough to please the environmentalists and however make enough profit to keep its owners satisfied.
6.1.1. Shareholders vs. Stakeholders at Deutsche Post DHL
Due to the fact, that Deutsche Post DHL is engaging in various social projects which require a huge amount of money such as the Disaster Response Teams, the company is not solely interested in profit maximization. However, not all projects require spending money. For example, the company saves money with its fuel-minimizing agenda within its GoGreen focus area.
Thus, from my point of view, Deutsche Post DHL wants to maximize its profits but it also considers its stakeholders and not shareholders exclusively.
6.2. Corporate Social Performance
Corporate Social Performance (CSP) is one of the most common terms when discussing a company’s role in a society. How a company meets or even exceeds its stakeholder’s expectations defines how stakeholders will evaluate the company’s social performance (cf. Husted B.W., 2000, pp. 24–25). CSR answers only the question, what should be done, but CSP covers also the company’s performance, meaning how a company will achieve their aims.
6.2.1. Social Responsibility
Carroll has divided social responsibilities into four categories, which derive from the stakeholders’ expectations: economical, legal, ethical and philanthropic responsibilities (Carroll A., 1996, p. 40).
The responsibilities are shown in the table below:
Table 1 Company's social responsibilities and societal expectations (adapted from Carroll 1996)
Economical responsibility is the basis of all other responsibilities and it means that a company must be economically profitable. According to this view companies’ responsibility is to produce their goods and services and sell them with profit. A company acts as a fundamental economical unit of a society. The society expects and demands the company to take care of this responsibility as well as its legal responsibility, which means that the company obeys the laws and rules of the society.
Ethical responsibility means that the company does the “right thing”, involves in “fair play” and avoids causing trouble. Philanthropic responsibilities involve good corporate citizenship - meaning that the company voluntarily helps the society and tries to raise citizens’ standard of living. The society doesn’t require this although it hopes for it. In that sense the last category seems not to be a responsibility for company (cf. Carroll, 1996).
6.2.2. Social Responsiveness
Social responsiveness is about company’s responses towards the social expectations, demands and wishes. It is not referring to managers’ morale or attitudes towards social responsibilities but basically describes how a company reacts in front of these requirements (cf. Carroll A., 1979, p. 501). The actions taken by a company can be reactive, defensive, adaptive or proactive.
The lowest level is the reactive. The company does nothing and tries to resist its responsibilities. It wants to do less than the expectations. In the next level, the company is defensive. Thus, the company does fulfill the minimum expectations. The company accepts its responsibilities but it acts defensively and reacts only on issues it has to.
An adaptive company tries to be progressive and it meets all the requirements it is confronted with. A proactive company is usually a leader of the industry. It meets and likes to exceed all its expectations and seeks actively new ways to create goodwill. (cf. Carroll A., 1996; Wartrick & Cochran, 1985).
6.2.3. Social Issues Management
“The third dimension of the model concerns the scope of social issues that management must address”(Buchholtz A.; Carroll A., 2008, p.57). The stages of social issues management are identification of the issues, analyzing them and developing a proper solution.
6.2.4. Corporate Social Performance at Deutsche Post DHL
What social responsibility categories does Deutsche Post DHL fulfill? Obviously, as a profit-oriented company, it fulfills the economic category. Since Deutsche Post DHL obeys the law, it satisfies the requirements for the legal category. Furthermore, the company behaves ethically and meets the society’s expectations with its social and environmental programs. Due to the fact, that the company is not doing more than expected, it is not reaching the philanthropic category.
Another question is, at what level the Deutsche Post DHL’s actions are taking place.
Since Deutsche Post DHL accepts its responsibilities as a multinational company (cf. Deutsche Post DHL, 2010), it should be at least at the defensive level. From my point of view, Deutsche Post DHL reached the next higher level – the adaptive level, because the company wants to implement a reliable corporate social responsibility program.
7. Morale Foundation – Aristotle’s Ethics
From Aristotle’s point of view, ethical knowledge is rather general knowledge than certain knowledge such as physics. Since it is not only a theoretical discipline, he considered that a person must have "experience of the actions in life" and have been "brought up in fine habits" in order to become good (NE 1095a3 and b5).
Thus, a person will not become ethical by studying what virtue is. Rather a person must truly engage in ethical activities. Aristotle differentiates between four types of people: vicious, incontinent, continent and virtuous (cf. Rorty A., 1980).
The first type of people is vicious. These people see only a small value in virtue and do not attempt to become more ethical.
Both, continent and incontinent people are facing a moral conflict. The difference between these levels is, that continent people are behaving virtuous most of the time, whereas, incontinent tend to be vicious in order to avoid conflicts.
The highest level, a person can reach, is the virtuous level. Those people truly enjoy their social activities and do not face any moral dilemma.
Although Deutsche Post DHL is not a natural person, one can find elements of Aristotle’s ethics in Deutsche Post DHL’s CSR program. Since the company seems to try hard in behaving socially responsible, one can say that Deutsche Post DHL is continent. But is it virtuous? From my point of view, Deutsche Post DHL is not virtuous, because it has to deal with the moral dilemma of behaving socially responsible on the one hand, and maximizing profit on the other hand.
8. Results
Deutsche Post DHL presents itself as a company which is strongly engaging in Corporate Social Responsibility. This self-presentation is supported by various positive critiques and awards such as the German Sustainability Award in 2009. None the less, the company has to face negative critique for using palm-oil fuel.
Since the company tries to satisfy the expectations from all people who are involved in the company or the company’s environment, Deutsche Post DHL is using the stakeholder’s approach. Furthermore, the company fulfills the economic, the legal and the ethical responsibility category, because Deutsche Post DHL is making profit, obeys the law and behaves ethically right. Due to the ethical behavior, one can conclude, that Deutsche Post DHL can be compared to the characteristics of a continent person according to the four different types of people by Aristotle.
9. Conclusion
To sum up, Deutsche Post DHL is seriously engaging in corporate social responsibility. The company is trying to help where it is needed, but Deutsche Post DHL is also trying to maximize its profit through its social activities. Therefore, the company is trying to find a “win-win” situation. On the one hand, the company is able to help the society and to minimize its negative impact on the environment. On the other hand, the company is trying to maximize its profit. Overall in the long-run, both win - the company and the society.
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