Automobile Industry and Sustainability

Question: Discuss about the Automobile Industry and Sustainability. Answer: Introduction This report is basically describing about two big companies in terms of their social values. For the discussion, two big companies Toyota and BMW has been taken. This report will focus on the differences between the companies in terms of range of issues which the companies are dealing in their social reports (Orsato Wells., 2007). Report will also focus on the specific issues of the companies. The descriptions of the companies are as follows: Toyota is the famous automobile manufacturer company of Japan. The company was started in 1937. Headquarter of the company is in Toyota, Aichi Prefecture, Japan. In the few years, Toyota has become one of the leading car manufacturing companies in the world. The company mainly targets low and medium income customers. The company has recently updated its brand cars for better customer services, reduction of carbon dioxide. The company has also changed its strategies for showing transparency to the general public. Like many other companies, Toyota has adopted unique set of values and principle that shape the business of the company in the market. The unique values of the company are the roots of formation in Japan. This is the most powerful and successful brand of Automobile manufacturer in the world. Headquarter of BMW is in Munich, Germany. The company manufactures and sells the passenger cars and motorcycles. The company has mainly three market segments and those are automobiles, financial services and motorcycles. BMW is basically a parent company of Mini and Rolls-Royce car brands. Along with this, the company also manufactures and sells a wide range of sporty cars and motorcycles. From starting, the company is always focused on the core values of business. The message of the values can be seen in its advertising such as television, press, media, motor shows, and trade shows etc (Toyota, 2015). Range of social issues dealt by the companies A business should not only b e accountable to the stakeholders but also it should be responsible for environment, society and towards a sustainable planet. Companies should use C RS activities in its business operations. Basically, CSR is the commitment in the business by the companies to give contribution in sustainable economic development by working with the employees, society and the local community to improve the quality of living standards. By analyzing the corporate social report of Toyota, it can be said that the report has little details related to the issues of its social responsibility but it is clearly providing the information about corporate social responsibility in the company. On the other hand, BMW has well-designed report of social responsibility in which the social issues are described clearly (Cool, and Schendel, 2010). According to the social responsibility report of Toyota, the company has concise, easy and simple strategy in the business operations which is appropriate for the stakeholders as well as customers. The strategy of the company shows that how technical staff of the company is responsible to manufacture better cars step by step. In the figure, the work of technical staff of the company is showing clearly. There is one weakness of Toyota that till 2015 that the Social responsibility Report of the company does not provide proper details of the social activities. It only tells about those things which have achieved by the company but it does not include important exiting social issues which are addressed by the managers and the potential customers. But, it should also be noted that Toyota is one of the leading company which have continuously done progress in improving and delivering the CSR to the society. The CSR of the company can be clearly seen in the fundamental changes to corporate principles and improved better cars (Zapata Nieuwenhuis, 2010) On the other hand, according to the social responsibility report of BMW, c0omoany wants to achieve highest level of sustainability by implementing relevant set of innovations and measures in teach stage of vehicle life cycle. The steps of vehicle life cycle in BMW are described in the given figure. The company releases sustainable value report every year. That report includes the description of CSR programs done by the company. There are various catagories of CSR activities adopted by the BMW such as supporting local communities, educating workers and employees, empowering labor and human rights, gender equality, environment concerns etc. basically, the CSR report of BMW focuses on the all the social issues that are addressed by the company (Zhu, Crotty Sarkis, 2008) Country differences By focusing on the CSR reports of both the companies, it can be analyze that there are lots of differences in the social reports of the companies. Toyota seems to be very practical and cautious while preparing its report. As compared to the BMWs report, it is even very humble. It can be said because the company is continuously working hard for providing efficient culture and adopting proper strategy for the society, government and stakeholders. By the report, it is clear that Toyota is very responsible to its shareholders, other stakeholders and suppliers. The company is also accountable for fulfilling its responsibilities for the local community, society and environment (Sturgeon, Biesebroeck Gereffi, 2008). So, responsibility category and stakeholder responsiveness of Toyota is higher than its competitors. According to the social responsibility report of Toyota, the company is highly responsive when it receives the complaints from the customers, especially senior people of the country. Toyota always tries to provide full customer satisfaction by the products and services. Along with this, Toyota has also achieved many awards i.e. The DJSJ Asian Pacific, The FTSE4 Good Index services and The MS-SRI. These awards prove that Toyota has implemented innovation and development in its products with the core values (Laasch, Conaway, 2015). On the other hand, the social report of BMW has deep information about the CSR activities of the company because the main of the report is to impress the shareholders and its customers. By its CSR report, BMW is successful in influencing its shareholders across the world. The social report of BMW describes how the company has implement ted the code of conducts for the business operations the report assures the general public that the company follows ethics standards in its business for the welfare of the society and environment. Company understands the impact of corporate operations on the society and environment. Company also understands that by investing in CSR products, company will be able to attract more and more customers (Jennifer, 2016) Apparent quality of the social accounting approach This factor will cover the qualities of both of the companies on the basis of Zadek et al.s (1997) eight criteria. This criterion will describe contribution of both companies in terms of best practices of the social accounting. There are mainly eight factors i.e. inclusivity, comparability, completeness, management policies and systems, evolution, disclosure, continuous improvement and external verification. The difference of BMW and Toyota is described in the tabular format: Criteria Toyota BMW Inclusivity Include how company gets feedback from shareholders by which company innovate and develops the cars throughout each process of producing. (Y) The company also includes stakeholders for every decision and for future activities. (Y) Comparability The reports of the company are compared to the past over time and listed standards in the report are well-matched. (Y) Standards are listed with the indicators comparing over the time. All the issues related to social and environment factors with CSR activities are described well. (Y) Disclosure The report is complete and showing the main accounts of the company and reported mainly positive factors. (Y) The report has described the procedure with the relevant sets of innovations. (Y) Management policies and systems In the report, social issues and the implementation of strategies are the important part. (Y) In the report, the procedures on then relevant issues are disclosed for the management. (Y) Completeness All the key activities with little details are described clearly. (Y) The CSR efforts of the company are described well. Report has benchmark and long term goals. (Y) Evolution The company has updated its report time to time with innovative ideas and strategies. (Y) BMW has updated its report annually with the code of conducts and ethics. (Y) External verification The report has been verified by an external organization. (Y) Also verified by external organization. (Y) Continuous Improvement Continuously improving the CSR activities and social performance. (Y) The efforts of the company has positive impact in terms of CSR activities and it is continuously growing (Y). Extent of values Then extents of the social reports by which their values can be reflected are as follows: Toyota BMW Core values Integrity and flourishing society. Integrity, respect for every person, responsibility for success and failure. Mission statements Sustainable growth, enrich lives of local community and always provide better cars (Toyota, 2015). To be most successful car manufacturer in the world and to come up with innovative products time to time. Business principles Contribute to economic and social development, and undertake open and fair business activities. Environment protection, educates workers, and support local community and environment. Toyota seems to very consistent in its report with what the company has done actually in the market. It can be seen by above described core values of the company. The company has the core value of integrity which is being followed by the company. Toyota has different approaches to solve the issues related to energy and resources. On the other hand, BMW always takes the responsibility of its success or failure. The company also has the integrity in its culture. The company is committed to responsible group and wants to provide best quality products to the entire world. The core values of company are demonstrated in the CSR report of the company. The core values can be seen in the quality and safety features in the car and in each product. On the other hand, in the CSR report of BMW, responsibility is one of the main values of the company. The company takes responsibility of every situation. The report demonstrated that the company gives respects to everyone and stands for all (GreenBi z, 2009). Conclusion Through the analysis it has been found about CSR that the report of the BMW is very simple but provides all the important information which is used to explain about the company. On the other hand, Toyota has less issues with more detailed diagrams which are important to know that how the company has achieved this. It is clear that BMW is more technical, well-informed and successful company in automobile industry. The content, design, and the format of the report of BMW are more complicated than Toyota. Toyota has simple format with little descriptions. It has been analyzed that Toyota is very responsible and devoted towards the sustainability in every aspect of the business. The company always creates better cars and focuses on the sustainability growth in the future. My group has both positive and negative sides for both the companies. No one can deny that there are many achievements for the companies and also failures to produce desirable cars. There can be failures due to many reasons such as carbon emission from electricity. It impacts the environment and companies business activities also. So, both of the companies have to understand the impact of natural situations and have to implement the CSR activities accordingly. References Toyota. (2015). Mission, Vision and Strategic Direction. Retrieved on 14th January 2017 from https://www.toyota.com.au/toyota/sustainability/cms/download/Mission_Values_Strategic_Direction_9-11.pdf Toyota. (2015). Corporate Social Responsibility Report. Retrieved on 14th January 2017 from https://www.volkswagenag.com/content/vwcorp/content/en/sustainability_and_responsibility/CSR_worldwide.html Jennifer, G. (2016). Principles of Responsible Management. Retrieved on 14th January 2017 from https://www.toyota.com.au/toyota/sustainability/cms/download/Mission_Values_Strategic_Direction_9-11.pdf Laasch, O. Conaway, R. (2015). Principles of responsible management: global sustainability, responsibility, and ethics. Stanford, USA: Cengage Learning GreenBiz, (2009). BMW and Toyota Create Most 'Sustainable Value,' Report Finds; GM, Fiat Among Laggers. Retrieved on 14th January 2017 from https://www.greenbiz.com/news/2009/11/02/bmw-and-toyota-create-most-sustainable-value-gm-fiat-lag Cool, K. and Schendel, D. (2010). 'Performance differences among strategic group members', Strategic Management Journal. 9(3). pp. 207-223 Zapata, C., Nieuwenhuis, P. (2010). Exploring innovation in the automotive industry: new technologies for cleaner cars: Journal of Cleaner Production. 18(1), pp. 14-20 Zhu, O., Crotty, J., Sarkis, J. (2008). A Cross-Country Empirical Comparison of Environmental Supply Chain Management Practices in the Automotive Industry: Asian Business Management. 7(4). pp. 467-489 Orsato, R.J., Wells., P. (2007). The Automobile Industry Sustainability: Introduction. Journal of Cleaner Production. 15(11-12). pp. 989-993 Sturgeon, T.J., Biesebroeck, J., Gereffi, G. (2008). Value chains, networks, and clusters: Reframing the global automotive industry: Journal of Economic Geography. 8(3). pp. 297-321