How Can an Emphasis on Ethics and Social Responsibility Improve Profits and Benefit a Business?

Based on my research, PepsiCo is an extremely ethical and socially responsible. PepsiCo bases their premise off of their values and philosophies as a reflection of the socially and environmentally responsible company they aspire to be. Every business decision that is made is based off of these philosophies and values. PepsiCo acknowledges their power and influences that they can make on different society’s and markets and use that to their advantage to make good and powerful actions to reflect on others. The company spends the extra time and steps to make sure that they fully understand what customers that they are dealing with and to be able to accomplish their needs and their desires in the products that they produce. PepsiCo’s mission is to, “be the world’s premier consumer products company focused on convenient foods and beverages. They seek to produce financial rewards to investors as they provide opportunities for growth and enrichment to

4. What was Pepsi’s meaning management game? Was it really a threat to Coke? How should have responded to Pepsi’s

In business, Anne Lawrence and James Weber (2014) identify enlightened self-interest as a corporation’s recognition that using corporate resource to serve others, including customers, employees, and the community as a whole, is in the best interest of the company. This social responsibility enhances the company’s image within the community, which increases both customer loyalty and satisfaction of employees. Some of the ways that businesses serve others is through philanthropy and backing environmental sustainability. Within his lecture on ethics and corporate responsibility, Dr. Kahlib Fischer (n.d.) encourages the importance of corporate social responsibility (CSR) in that it provides mutual benefit to both the organization and the community.

What I find to be the biggest indicator of concern is that PepsiCo’s profitability is currently declining, despite its ever-increasing sales figures. It has lost 2% on both its profit margin, and return on assets. The return on common stockholder’s equity, has dipped by 4%, and they lost $.02 over every dollar invested in assets in 2005. This goes back to my assessment of their sales and net income figures. Here again, I see indications that their spending has increased dramatically, which is having a negative impact on profitability. Since the soft drink industry is a high-volume, low-overhead industry, controlling and minimizing expenses is of paramount importance. I find this trend to be very troubling, considering PepsiCo’s sales haven’t stopped climbing, yet they are starting to lose their profitability. Should their sales dip, they will be very hard put to maintain themselves.

According to PepsiCo “Organic revenue grew 5 percent in the fourth quarter and in the full year, reported net revenue declined 1 percent for the quarter and 1.5 percent for the full year, reflecting the impact of previously announced structural changes” (PepsiCo, 2013). The cost of running the business paid off from a revenue standpoint but overall net revenue fell by one percent. Additionally, Pepsi remained exceedingly concentrated on generating appealing returns for shareholders, and returned $6.5 billion to shareholders in 2012 “through a combination of share repurchases and dividends,” (Pepsi, 2013) This increased costs for the company but the cost spending implemented paid off for shareholders who would be more willing to invest more in the company in the future.

Coca-Cola is a leading beverage industry in the United States and many other countries in the world. PepsiCo is also a leading worldwide beverage company, but they are also the parent company of the Frito-Lay and Quaker Oats Companies. This makes PepsiCo a leader in the beverage, snack and cereal industries. As consumers, we have indulged in their products for many years. My personal preference has always been Pepsi over Coke, which is why I was very interested in conducting this analysis. Regardless of the results, I will always seek out a Diet Pepsi over a Diet Coke and so will many of my physician friends at Children’s Hospital who start their mornings with a Diet Pepsi. These personal preferences are what contributes to a company’s profits through net sales. However, the key performance measurement tools used are not based on sales alone. Calculating liquidity, solvency, and profitability ratios on a regular basis give us a better insight on the performance and overall health of a company.

Pepsi –cola was started in the summer of 1898 in New Bern, North Carolina by Pharmacist Caleb Bradnham. PepsiCo Inc. started in 1965 with the merger of Pepsi-Cola and Frito-Lay. Since then, PepsiCo has continued to grow, adding new brands and product lines meeting the demands of the market. Throughout the years, they have strived and worked toward environmental sustainability. The ability to be financial stable gives PepsiCo the ability to give back and donate to those communities they are located in. PepsiCo’s mission to provide performance with purpose means delivering sustainable growth by investing in a healthier future for people and our planet. PepsiCo is continually increasing their triple bottom line.

In 2012, the United States Environmental Protection Agency awarded PepsiCo its prestigious Energy Star “Partner of the Year Award for Sustainable Excellence.” PepsiCo was honored with this award because of the continued effort to reduce greenhouse gas emissions (GHG). Even with an increase in products, the company has been able to maintain their carbon footprint. Their goal is to improve energy efficiency by twenty percent and to keep greenhouse gas emissions at a level amount. Some of the ways

Pepsi Co 's assignment taken as a whole is to amplify the value of its shareholder 's investment through sales intensification, expenditure gearshift and prudent investment of resources (Bongiorno, 1996, p 71). In this pose, Pepsi believes that its moneymaking triumph depends on

Corporate social responsibility has been one the key business buzz words of the 21st century. Consumers' discontent with the corporation has forced it to try and rectify its negative image by associating its name with good deeds. Social responsibility has become one of the corporation's most pressing issues, each company striving to outdo the next with its philanthropic image. People feel that the corporation has done great harm to both the environment and to society and that with all of its wealth and power, it should be leading the fight to save the Earth, to combat poverty and illness and etc. "Corporations are now expected to deliver the good, not just the goods; to pursue

Coca-cola boasts of being the world’s largest beverage company serving approximately one billion customers daily. The most dominant products distributed by Coca-cola are Coke, Fanta, Sprite and Diet Coke. This strategy is aimed at ensuring that every customer gets satisfied whenever they use a Coca-cola brand. Coca-cola has large distributions across the globe making it the largest distributor in the world. The late Roberto Goizueta termed Coca-cola to be an American company with large international business and a sizeable American business (Ferrell, 2008). This has helped a lot with brand selling as it is the most recognized brand in the whole world. “Coca-Cola has the most valuable brand name in the world and, as one of the most visible companies worldwide, has a tremendous opportunity to excel in all dimensions of business performance” (Ferrell, Fraedrich, & Ferrell, 2008). Coca-cola, however, has not been smoothly running over the decades in operation. It has on numerous occasions been criticized for overlooking some ethical standards that it should have rather upheld. This essay aims at looking into some of the issues facing Coca-cola, the most significant of them, how they were resolved and how Coca-cola should have solved them.

Some business leaders are taking good moral decisions and the reason behind that idea is that the core part of their business strategy is to create mutual benefit for both wider society and business as well. The growing desire of top management is to find out ways to create mutual benefit for both the organizations and the stake holders but the public still believes that companies are greedy entities which make decisions only in their self-interest, even at the cost of greater public welfare. It is the utmost obligation of the companies to discern the social issues while making the decisions (Yashiro, Yoshida and Suzuki, no date; Godwin, 2006; Schwab, 1996; Godwin, 2008; Werhane, 1998; Werhane, 2002; Heath, 2008; Mehalik and Gorman, 2006).

PepsiCo Inc. is one of the leading brands in the world's food and beverage industry. It operates globally with a strong customer base and a wide array of products. This paper analyzes the general business environment for this leading food and beverage brand in order to assess what strategies it has been pursuing to operate in this challenging and complex environment. The analysis of internal and external environment has also been done in a view to figure out the biggest strengths, weaknesses, opportunities, and threats for the company. The final section gives an overview of the company's resources, capabilities, core competencies, and value chain which can help it to achieve a competitive advantage in its industry.

As an increasing number of people become more conscious of what they consume health wise and increase their awareness of their impact on the environment, they begin to actively decide who to purchase from. Companies must become more aware of their consumer’s transforming habits and values. ‘Companies today are bigger than many economies…little republics…if companies don’t do [responsible] things, who is going to?’ (Deresky, 2014, PC4-9). It’s hard enough developing a competitive edge to beat out the competition, but to do so while still holding true to the acts of shrinking one’s environmental footprint and giving back to local communities seems realistically unattainable. For all intents and purposes, can performance with purpose work for the performance aspect effectively? (Deresky, 2014)

Companies with extensive responsibilities even argue about the system in pursuing social responsibility of business. According to Ulrich Steger, the company should prioritize the shareholders’ incessant interest but they should also be concerned of their social responsibilities, morals and environmental goals that the public expects them to be. Without a doubt, companies’ primary goal is to earn a profit. Emphasizing on profitability affects the fundamental values in the company, its morality. Companies ignore the ethics just to earn a mountainous income. This often causes extensive repercussions in the companies.