Canon Hong Kong: External Environmental Analysis and CSR Policies

Running head: CANON HONG KONG
Ethics and Corporate Social Responsibility
[Canon Hong Kong]
Name of the student:
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1CANON HONG KONG
Table of Contents
Task 1: External Environmental Analysis.......................................................................................2
1.1 Background study..................................................................................................................2
1.2 PESTLE analysis...................................................................................................................2
1.3 Porter’s Five Forces analysis.................................................................................................5
Task 2: Ethics and Corporate Social Responsibility........................................................................6
2.1 Background study..................................................................................................................6
2.2 Analyse the relevance of CSR to Canon Hong Kong and its influence over policies &
decision-making process in the company....................................................................................7
2.3 A critical evaluation of the effectiveness of the organization's response............................12
2.4 Recommending some areas of improvement.......................................................................14
Conclusion.....................................................................................................................................15
References......................................................................................................................................16

2CANON HONG KONG
Task 1: External Environmental Analysis
1.1 Background study
This section will cover an external environment analysis of Hong Kong in which Canon
Hong Kong operates. The company has its presence in the whole world. The year of the
foundation of Canon is traced in 1937. It is headquartered in Tokyo, Japan. The list of products
includes many such as SLR cameras, Photocopiers, Still cameras, Camcorders, Digital cameras,
LCDs, Lenses, Micro motors, Scanners, Ophthalmic instruments, magnetic heads and other
office peripherals (Canon.com.hk 2018).
1.2 PESTLE analysis
Political: The political state in Hong Kong is dominated by a question on whether the country is
a part of the mainland China. There are no tariffs imposed on imports to China for goods which
originally belong to Hong Kong. This is due to the economic integration of Hong Kong with the
mainland China under the Closer Economic Partnership Agreement (CEPA) signed in 2003
(GOV.UK 2018). The Shanghai-Hong Kong Stock Connect pilot scheme was introduced in 2014
which allowed international investors to invest in China and Chinese investors in Hong Kong
(GOV.UK 2018). It just suggests that foreign investors entering Hong Kong will have a fair bit
of chance to expand into and develop a business relationship with China. There is zero tolerance
for bribery. Hong Kong is one of the top 20 global countries in regards to Transparency
International’s Corruption Perceptions Index (CPI) (GOV.UK 2018). Nonetheless, Canon’s
business in Hong Kong is very safe and less challenged by corruption. The wages are revised
every two years in Hong Kong; however, minimum wages are still very low (Barnes et al. 2015).
This is good and productive also from the Canon’s perspective. Hong Kong does not impose

3CANON HONG KONG
trade tariffs on both import and export of goods. Licensing is only required to fulfil the
obligations and ensures to meet public health & safety needs (Tid.gov.hk 2018). Canon will,
therefore, have no issues in exporting and importing of goods and the required materials.
Economic: Hong Kong is a free trade zone which is an asset to any business. Even the exporters
will also enjoy doing business with the country. The licensing formalities are also very simpler
which mean the fewer trade barriers in regards to trade policies (Tong, Tak and Wong 2015).
The unemployment rate is about 3.4% (Heritage.org 2018). The fact suggests that Canon will
have fewer difficulties in finding the skilled professionals. Hong Kong being an exceptionally
competitive financial and business hub is one of the most resilient economies in the world
(Heritage.org 2018). Notably, such facts are very rare in most countries in the world. Canon
would perhaps have the more favorable economic condition than in most other countries it
operates in.
Socio-cultural: Hong Kong has an aging population (Tong, Tak and Wong 2015). The aging
population will create difficulties for the Canon Company in terms of recruiting the professionals
and also experimenting with the range of products. Hong Kong is quite a matured economy
which makes its customers more discriminating and sophisticated. Customers are more prone to
lower priced products while not compromising with the product’s quality (Vu et al. 2015).
Therefore, Canon will need to compete with its rivals with respect to price and quality features.
Digital technologies are in huge demands in Hong Kong. Customers are increasingly becoming
exaggerated for digital cameras, 3D printers & scanners, 4k embedded LCDs and a lot more
(Leung et al. 2015). It, therefore, means that Canon will need to keep an elevated focus on
spending over R&D.