Corporate Social Responsibility and Ethics Assignment

K E E N
2011
KEEN
Sustainability Audit
Amanda Aplet
Anna Kiritchenko
Melissa Buisan
Marshawna Williams
KEEN Contact: Chris Enlow - Care and
Community Manager
Email: [e-mail]
Phone: [phone]

Table of Contents
Introduction................................................................................................................ 2
Background................................................................................................................ 2
Grading Scale............................................................................................................. 3
Corporate Social Responsibility and Ethics.................................................................4
Environments............................................................................................................. 6
Social-Cultural Environment.................................................................................6
Economic Environment........................................................................................ 8
Competitor Environment...................................................................................... 8
Technology Environment...................................................................................... 8
Legal-Political/Federal Environments...................................................................9
Natural Environment.......................................................................................... 11
Metrics and Measurement of Movements.................................................................14
Positioning and Market Segmentation......................................................................17
Product Positioning............................................................................................. 17
Market Segmentation......................................................................................... 18
Global Issues............................................................................................................ 19
Products and Services.............................................................................................. 21
Branding and Packaging........................................................................................... 25
Sustainable Value Circle........................................................................................... 29
Sustainable Pricing................................................................................................... 30
Sustainable Marketing Communication....................................................................31
KEEN’s Hybrid.Life Campaign............................................................................. 32
KEEN’s Recess is Back Campaign.......................................................................34
KEEN’s STAND Campaign................................................................................... 34
Final Recommendations........................................................................................... 35
Works Cited.............................................................................................................. 40
Honors Pledge:
As a student of the Dr. Robert B. Pamplin Jr. School of Business Administration I have read and strive to uphold the University’s Code of
Academic Integrity and promote ethical behavior. In doing so, I pledge on my honor that I have not given, received, or used any unauthorized
materials or assistance on this examination or assignment. I further pledge that I have notengaged in cheating, forgery, or plagiarism and I
have cited all appropriate sources.
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Student Signature: Amanda Aplet, Anna Kiritchenko, Melissa Buisan, Marshawna Williams
Introduction
KEEN, Inc. is a shoe manufacturing company that is based here in
Portland, OR. KEEN footwear was founded in 2003 by Martin KEEN and
Rory Fuerst who had a taste for outdoor adventure. KEEN was not just built
on a shoe but they try to incorporate, what they all, HybridLife. HybridLife
is KEEN’s mantra for having good business practices that encourage
outdoor activities well taking care of each other and the earth. KEEN has
built their foundation on corporate social responsibilities by creating
economically friendly and sustainable products, encouraging life balance
through “recess is back” and giving back to help solve social issues around
the globe. What has KEEN not done? To answer, throughout this report we
have explored all aspects of KEEN, from production to culture to marketing.
Using the Natural Step Framework we have analyzed KEEN’s
organizational suitability efforts and made recommendations on where they
can improve the business to be more sustainable. One of our main
observations throughout this audit is that KEEN is very good about
encouraging a work life balance among their employees and to their
customer. Yet, we have discovered that there is a lot more they could do in
the production of their shoes. Adding to the aspect that KEEN has many
great core values but it is the little things that can make the biggest impact.
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Background
KEEN, which is privately held and moved its headquarters from
Alameda, Calif., to Portland five years ago, recorded about $200 million in
sales last year. With more than 5,000 retail sites in more than 50 countries,
the company projects $250 million in sales this year (Brettman, 2011).
KEEN was founded on the idea of making a cover toe sandal and its first
featured shoe was the Newport that also featured the thick black bumper
that covers the toes. KEEN soon found their market in promoting outdoor
and water activities. KEEN footwear has been a fast growing company since
the launch in 2003. Today, KEEN has introduced over 150 footwear styles.
As KEEN grew more variety of footwear styles were added, growing its
causal business and cold weather footwear as well as a line of bags and
socks. In 2006 KEEN moved to Portland, OR and at the same time Kirk
Richardson joined the company as president after 27 year at Nike and
James Curleigh joined in 2008 as CEO. That same year Richardson lead
KEEN’s corporate social responsibility and since 2004 after donating their
making budget to tsunami aid in Asia, KEEN continuously makes the effort
to donate to various organizations. This was the first step in KEEN’s long
term Hybrid Care program they partner with other organization that also
attack and contribute to social issues.
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Grading Scale
In order to come up with a realistic sustainability grade for KEEN, we
created a rating system that broke down the final grade to include the ten
aspects that we discuss throughout our paper. After analyzing each aspect
we gave it a score of 1-4, with 1 being the lowest rating and 4 being the
highest rating. Then we took the average of all ten ratings and were able to
determine a final sustainability grade for KEEN.
Corporate Social Responsibility and Ethics
In 2008, KEEN released their first and only whole-system self-
assessment they call the “report card.” The report card covers KEEN’s
corporate social responsibility practices, guidelines, and goals regarding
three key areas: environment, community, and growth (Report Card, 2008).
According to the report card, its purpose is to “provide information and
supporting metrics on the challenges, successes and disappointments we
are (KEEN is) experiencing during the journey toward social and
environmental best practices” (Report Card, 2008). The report card was
created following the sustainability reporting framework of the Amsterdam-
based Global Reporting Initiative. This framework, which is becoming the
global standard, indicates how to measure and report economic,
environmental, and social performance (Report Card, 2008). This
accountability report card is reported at the public disclosure level (“C”
level).
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As the Global Reporting Initiative indicates, KEEN created a CSR
team and Report Card Review Committee rather than a third-party reviewer
to “substantiate the report’s accuracy” and advise them on the creation of
their report card (Report Card, 2008). The committee is made up of five
experts: a non-profit organization officer, university professor, supplier,
third-party logistics provider and a KEEN employee, who all volunteered for
the task. Through a series of meetings, the team reviewed the report card
and provided input on the changes or additions that needed to be made to
the scope and depth of future reports. KEEN also plans on expanding the
size of the committee to include a wider range of stakeholders.
As briefly mentioned before, the report card addresses KEEN’s
relationship with the environment, the community, and growth with a focus
on the product line, supply chain, and headquarter operations. More
specifically, it provides an introduction to the purpose of the report,
explains and introduces the review committee, and proceeds to cover
detailed topics about the products themselves, delivery, environmental
impacts, labor, carbon footprint, supply chain, (etc.) and community
outreach and goals. The first appendix of the document provides a list of the
required topics required to be covered in their internal assessment. KEEN
uses the following index to summarize how they assessed themselves on
various informational requirements:
“I” means they included the requirement
“P” indicates partially included in accordance with available data
“ND” indicates no data available
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“NA” indicates not applicable due to KEEN, Inc. lack of presence in this
area
“NR” indicates not required for “C” Level Reporting
(Report Card, 2008)
KEEN is aware that a CSR document benefits their corporate and
brand image as well as builds a connection with customers. KEEN states the
following benefits of their report card: “(it) allows us to engage with
interested community members, helping us to link our vision and brand
values with our day-to-day actions. The report also guides our ongoing
efforts in setting goals and measuring progress, as well as gauging our
performance against peer companies” (Report Card, 2008). They are also
aware that their CSR commitment establishes transparency requirements
and they expect that their report card will influence them to “remain
accountable for ensuring openness in our business practices” (Report Card,
2008).
Corporate Social Responsibility and The Natural Step Framework
KEEN’s CSR focused report card causes little systematic increases in
environmental concentrations of substances from the earth’s crust. It is
largely electronic, so unless it is printed, the major extraction of substances
from the earth can be traced to the production of computers and the
electricity to run them. Similarly, their electronic statement causes
systematic increases in environmental concentrations of synthetic
substances related to computer hardware. Other than the negative effects
of e-waste, the report card causes no systematic increases in ecosystem
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degradation unless it was printed on glossy/toxic paper with toxic ink and
was not recycled. And finally, the report card creates no systematic barriers
to people meeting their own needs. Overall, the CSR focused report card is
digital and therefore does not directly influence the Natural Step
Framework, therefore we rank this aspect of KEEN as a 4 (highly
sustainable).
Environments
Social-Cultural Environment
Education and marketing and media influence the social-cultural
environment. Besides statements on valuing sustainability and striving to
progress in sustainability, we did not discover any evidence that KEEN is
trying to influence their customers by educating them on the importance of
sustainability. Considering that their targeting the micro-culture of outdoor
enthusiasts who value durability and functionality of outdoor shoes, they
most likely have some background on the importance of sustainability.
Instead, KEEN focuses on the distinct style and comfort of their footwear
and various attributes of their footwear, such as waterproof materials,
reflective webbing, steel toes, and slip resistant soles, and other features
that deliver value to their target.
Regarding marketing and media channels, KEEN has a campaign
called Hybrid Life that is intended to illustrate the company’s brand image.
Hybrid Life is meant to “attract creative thinks, outdoor lovers, and social
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