Cadbury's CSR: Conducting an Organizational Ethics Audit and Analysis

This report provides an organizational ethics audit of Cadbury, focusing on its corporate social responsibility (CSR) initiatives. It assesses the environment in which Cadbury operates, including the political, economic, and social factors that influence its business. The audit examines public policy and regulatory issues, stakeholder views and expectations, and the alignment between the organization's and community's views on social responsibility. It also explores Cadbury's code of ethics and ethical organizational culture, evaluating the extent to which the organization engages in ethical practices. The report includes a reflective analysis based on academic literature and credible theories, and it identifies ethics-related issues confronting the business at environmental, organizational, and personal levels. The analysis covers Cadbury's stakeholder engagement, social activities, environmental efforts, and employment policies, highlighting both strengths and areas for improvement in its CSR approach.

Running Head: CSR
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Name of Student
Name of University
Author note

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Introduction
The assignment aims to engage in the development and use of a descriptive and analytical
framework with the intention of conducting an organizational ethics audit. The chosen company
is Cadbury, the confectionary giant, and begins with an assessment of the environment in which
the company operates. The central focus of the discussion is corporate social responsibility and
how the company approaches it. The audit analyzes matters such as public policies, stakeholder
behavior and its implication on business operations with regard to social responsibility. The late
section of the paper contains personal observations on the topics covered in the former section.
The arguments in the reflective analysis is based on relevant academic literature and credible
theories. Finally, the paper concludes with the identified ethics related issues confronting the
business at the environmental, organizational and personal events.
Company background
Cadbury is the most recognized confectionery brand in the world. The company is
headquartered in the UK, and operates business in more than 40 countries around the world.
Cadbury Chocolate | Cadbury.co.uk. (2019). Retrieved from https://www.cadbury.co.uk/
Although the product ranges of the company is limited and undiversified, they cater to a wide
variety of palettes across the world. Cadbury has a strict code of conduct and operates business
in terms of its established organizational culture. Currently, the company is chiefly run by the US
organization Kraft foods.
The economic and political environments in which Cadbury operates
The political and economic environments of a country is crucial to its market structure,
potential growth and also influences its organizational culture. As far as the headquarter in UK is
concerned, the political shift of the country’s government to liberal/conservative democrat from

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Labor party has largely influenced the business operations of several privately owned
organizations like Cadbury. In England, Cadbury generally employs about 2000 workers in
factories. However, the inflexible rules imposed on the entrance of skilled labor from other
countries will severely influence the hiring decisions of the company in the future. Tax
imposition on property and assets is another determinant in the company’s decision to pay
shareholders and manage other business-related investments. The increase in value-added tax
will increase the price of food products which might reduce the sales. Schweppes in 2007
outsourced a major portion of the company’s HR and accounting department to a service
providing firm in India. The decision was taken to mitigate high operational expenses and
decreased sales. If Cadbury continues to sell its portions to firms in developing countries, it
might cause unemployment in European countries. Although, this will create employment
opportunities in developing countries like India. The international economic downturn affected
the company’s expansion plans (succumbing to reduced disposable income of consumers and
stakeholders) although the sales of Cadbury remained steady all around the world. The massive
sales of trident and Dairy Milk account for about 30% of its total annual profits.
To a great extent, Cadbury as an organization is purely a product of social factors and its
influence on product manufacturing. The family that initially run the business, was opposed to
alcohol and initiated with the sole purpose of replacing alcohol-based drinks with tea, coffee,
liquid chocolate and cocoa. The cocoa-based products sold by the company is accepted
worldwide among different cultures, although Cadbury had been on the receiving end of various
controversies in some countries where people have strict religious and moral beliefs.
Additionally, the growing concern in the western world about obesity and other consumption-
oriented disorders deeply affect the company’s sales. Doctors and nutritionists suggest patients to

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reduce the consumption of sugar-based products like candies, chocolates which will affect
Cadbury’s future sales. The advancement of technology plays an important role in the production
process of the company. New innovations such as pathogen use and heat-resistant chocolate
increases the cost of production besides imposing health hazards on consumers.
Organizational ethics and culture of Cadbury
From the very beginning, Cadbury has aimed to establish itself as an organization that is
deeply committed to ethics and corporate social responsibility. Coming from a long line of ethnic
group, Cadbury values philanthropy and links the business operations to moral attributes. The
consistent attempts of the company to portray and image of sanitation and cleanliness has paid
off well for the brand value. The management style of the organization is based on democratic
principles. All decisions relating to business is carried out by a consultation process that involves
various members of the organization from different markets. An analytical look at the
organizational structure of Cadbury, it becomes clear that over time the company has replaced its
workforce with efficient machines. As the company has broadened the scope of its business to
different nations, it has resulted to multi-skilled employees who are equipped to work in several
areas of the business. Cadbury believes in team works and group performance for creating a
brand that is lovable and reliable, both for the company’s stakeholders and for the consumers.
The company is committed to the interest of each one of its stakeholders and hence does not
operate in isolation. It also aims to create a constructive relationship with the stakeholders.
Cadbury regularly consults with its employees in order to establish healthy and cordial
relationships with its stakeholders. The management team responds positively to the concerns
and needs of the stakeholders and treats them fairly for securing business prospects. Cadbury has
several employees of the company who also function as stakeholders to the market shares and

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risks. Increasing the stakeholder engagement in the operations of business acquired Cadbury
many benefits in terms of stakeholder behavior (Costa and Menichini., 2013). Employees who
are also stakeholders to the company have improved their efficiency in the work as a result of
increased stakeholder engagement. Stakeholder engagement in business operations also ensure
that all the problems are duly addressed and that the decisions are understood and
communicated. Cadbury has more than 50,000 shareholders, which include big institutional
investors and private investors. All owners of share and stake are entitled to a general meeting
that is held annually. This is an opportunity for them to discuss the performance of the company,
vote for or against certain matters, and ask questions about the business operations. Cadbury
maintains regular communication with all shareholders and stakeholders including consumers,
supplier and employees. The suppliers work in partnership with the company making it possible
for the business to improve the quality of the materials while carrying out the operations in an
ethical manner. The employees respond favorably to the open communication system although
they are not favorably disposed to the idea of organizational hierarchies that Cadbury has
maintained strictly over the years.
Cadbury engages in several social activities to establish their ethical standing in the
market. A clear CSR strategy differentiates the company in the market. It is one of the most
widely recognized fundraising companies that has sponsored Olympic campaigns and many
athletic groups and sports teams. Cadbury is hugely responsible for uplifting the economic
conditions of millions of cocoa farmers across the world. The programs initiated by the company
have contributed to the development of the local community. The International Cocoa Initiative
is a foundation established in 2003 which aim to work towards responsible cocoa cultivate.
Cadbury further strives to limit its air emissions and fuel consumption to take a stance against

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environmental degradation. The employment policies of the organization is based on ethical
principles and encourages diversity within the workplace. After employment, Cadbury provides
opportunities to the staff to hone their skills and develop personally within the organizational
environment. The regular rewards and remuneration system encourage the staff to increase their
work productivity. A major segment of the company’s shares is dedicated to increase the
conservation of water. Researches undertaken by the company based on cocoa-cultivation has
made considerable contributions to agricultural studies. Cadbury factories in many developing
countries have installed streetlights that are run by solar power. This is a notable action to reduce
greenhouse emissions and play a major role in reducing global warming. The migrant workers of
Baddi factory are given the opportunity to avail free education. Additionally, Cadbury a=has
established several non-formal schools as part of their social commitment to create healthy,
prosperous and inclusive communities. The management engages in some very serious lateral
thinking which has made social improvements. Services like access to fresh drinking water,
medical aid, vet clinics of lactating animals and food resources for the household of farmers
working for the company can be availed completely free of cost, on account of the company’s
CSR policies.
Reflection and Preliminary Analysis
From what I have observed while analysing the organizational audit of Cadbury in terms
of corporate social responsibility, the company has successfully aligned its behavioural norms
and organizational practices. In other words, Cadbury practices what it preaches. CSR may not
be a legal requirement, it is indispensable to building a good brand reputation for a company. It

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is as profit yielding in the long run as it is necessary. Consumer these days are increasingly
aware of their rights and responsibilities and expect companies to abide by them.
For me, operating a business demands a serious amount of awareness and understanding
not only of the internal business operations but also of the external environmental factors that
influence them. The social policies formulated by a firm must be aligned with its organizational
practices for effect. Policies without effective application in the material world are irrelevant and
useless (Šneiderienė and Griauslytė., 2014) . As per my observations from the analysis, Cadbury
meticulously attempts to align the practices with the policies, although there are some loopholes
in the operation process. The organization endorses health awareness on several occasions but
makes no visible attempts to add nutritional value to its own products, which are high in health-
hazardous substances. This demonstrates a lack of goodwill, an antipathy towards the consumers.
Further, this decreases the competitive advantages of the company, since other rival firms offer
sugar-free products and a health-benefiting food items to satisfy consumer need and secure their
trust. Social initiatives undertaken by a corporate incurs many business benefits for an
organization. The link between business and social interest is direct and explicit and promotes
the brand value of the organization (Martinez and Bosque., 2013). It has been observed by
theorists time and again that a company increases its chance of expansion and creation of a
reputable brand name if it is tied to some specific CSR policies. Implementing the policies help a
company increase its customer retention and expand consumer value. Cadbury has successfully
maintained healthy corporate relationships with the organization’s networks, suppliers and
consumers. It has helped the company develop and improve in terms of risk management and
management of operational costs. Cadbury has a happy and content workforce as it implements
the ethical policies within the organizational culture and aims to keep employees motivates. The

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ethical principles adopted by the company has also helped the company differentiate the business
from its competitors, thus increasing competitive advantage. This is also a viable strategy to
generate innovation and enhance the influence of the company in the market. The most lucrative
aspect of carrying out social responsibilities is that it generates a positive publicity among the
target audience and draws in more media opportunities since the media of the 21st century takes
a keen interest in the ethical activities of a business. Statistics indicate that consumers are more
likely to purchase products, or avail services from companies that engage in CSR activities more
than the ones that do not. If a company is committed to ethical practices and aims to engage in
activities that directly or indirectly contribute to the well-being of society, it increases the
brand’s recognition and create positive awareness among potential customers. In my opinion, it
also helps saving costs as even the minor changes that are made in favour of sustainability can
help a company reduce its productions and operation costs to a great extent. By embracing social
responsibilities, a company goes one step ahead of its competitors by establishing itself as a
profit-driven organization with social and environmental considerations. It also increases the
engagement of customers as the local media outlets frequented by a huge section of the
population covers such issues. Customers follow such local media coverage and instantly
engages with the operations of the brand. A strong and sound CSR program attracts more
partners and investors to a company by illustrating the fact that the business goes beyond its
profit motive. As survey suggest, a majority of the world’s population expects companies to be
integral to their social responsibilities and would refrain from buying products from a company
that has been market for carrying out activities deemed unethical. Quality corporate social
responsibility programs is synonymous with more sales and content consumers who recommend
the brand to others.

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Conclusion
In terms of environmental policies, Cadbury has lived up to its promises. The company
has reduced greenhouse gas emissions and water and electricity scarcity to a great extent.
However, Cadbury needs to reshape its organizational culture for aligning more with its ethical
policies. The organization follows a hierarchical model of conducting the business and that is not
in keeping with the values of corporate social responsibility. Even though the management
engages employees in the decision making process, the higher authorities in the management is
positioned to take business-related decisions without informing the employees; they can even
take steps against the employees without proving any immediate reason.

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