Corporate Social Responsibility Analysis: A Focus on H&M's Practices

This report provides a comprehensive analysis of H&M's corporate social responsibility (CSR) practices. It begins with a brief overview of H&M, including its rationale and global presence, followed by an examination of its CSR ranking and specific corporate actions that have influenced this ranking. The report delves into examples such as donations of books and food, and responses to societal events. Furthermore, it explores how H&M's CSR approach influences consumer purchasing decisions and its relevancy in the current business environment, including discussions on back-to-school initiatives, equity, diversity, inclusion, and incentives. The report concludes by emphasizing the importance of CSR activities in building a positive brand image and ensuring business sustainability. The report uses academic sources to support its findings.

Context of Business

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. Brief summary of H&M and its rationale...............................................................................1
2. H&M's rank with regard to its CSR........................................................................................1
3. Specific examples of corporate actions that resulted in this H&M's ranking.........................2
4. H&M’s approach to CSR influencing the purchasing decisions............................................3
5. Relevancy in between current business environment and CSR of H&M...............................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
In present business world, corporate social responsibility is being considered as the
integration of programs that benefits the society. Business model along with the organisational
cultures are the two vital factors which basically comes under corporate social responsibility and
it is needed for a company to focus on these two (Askariazad and Babakhani, 2015). Under this
report, firm which has been chosen i.e. H&M and it will include a range of things like company
rank with regard to CSR, specific examples of corporate actions. In the last, report will cover
relevancy within current business environment and corporate social responsibility of H&M.
MAIN BODY
1. Brief summary of H&M and its rationale
Hennes & Mauritz AB, a Swedish well known fast fashion brand found in the year of
1947 by Erling Persson. Company is famous in all over the world with the name as H&M. It is
having around 4,500 stores in more than 60 nations. On the other hand, organisation is also
consist with approximately 130,000 efficient employees that are performing well in different
stores in all over the world. Along with this, if it is talked about corporate social responsibility of
H&M, it is specifically works to develop a strong local and international presence, through
making contributions in order to bring positive change (Bargiela-Chiappini and Nickerson,
2014).
This CSR policy of H&M, which is a retail private limited organisation has been
developed considering the Schedule VII of law i.e. Companies Act, 2006 (Bell, Bryman and
Harley, 2018). Away with this, significant reason behind this is that change, a factor which
cannot be controlled in any sector due to updates in technology, human needs and more. It has
been analysed that, specific activities of a company changes every single year and this also do
not limits the alterations to a small extents. This basically covers a range of things like bringing
equality in the society, promote inclusiveness, delivering education and its benefits, access to
safe water and environmental sustainability.
2. H&M's rank with regard to its CSR
In order to sustain at marketplace for a longer period of time, it is the responsibility of
every single business organisation to work for society so that it's standardisations could easily be
improved (Cheng, Yang and Sheu, 2014). Therefore, corporate social responsibility is one of a
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kind approach that H&M and other business companies performs to produce overall positive
impact on society. Basically, it is done for removal of unethical activities and for economic
development (Crane and Matten, 2016). Here, it could be understood with a good example where
H&M has performed CSR actions like in orphanages, company distributed books in order to
improve education level of vulnerable.
It is being analysed that, company uses a way to create business value through corporate
social responsibility to create environmental and social value first. Here, both managers and
leaders may not think in the same way where real values, a CSR activities could effectively pull
out. On the other hand, it has also been analysed that cost of CSR policy of H&M basically going
high on a regular basis and this has affected profit margins as well in a positive sense (Jazdi,
2014). Mostly, companies sees CSR activities as money making approach and just performs a
little work so that positive reputation could stay for a longer period of time.
Along with this, it has been found that H&M mostly do not delivers detailed information
to public linked with CSR actions but, it stays present on its official website. According to the
report which was given by corporate knights in 2018, H&M was ranked at 57 out of 100
(Rankings per brand, 2019). The study results shows that companies which understand how to
create positive perceptions of their CSR programs gain the benefit in terms of sales and
recommendations from customers.
3. Specific examples of corporate actions that resulted in this H&M's ranking
Ranking of business organisations in CSR affected by one of the biggest factor which is
Corporate actions. Because of the corporate actions taken by H&M, their ranking has been
improved from a few years to 2018 (Mayda Cunha Mattos and et. al., 2014). Some of the major
examples of corporate actions are as follows:
 Donation of Books: When H&M was in their early phase, by donating books to needy
people or organisations, company grow and promote their business. Leaders and
managers of H&M decides to attract enough number of investors so that they can make
investment in their company. With the help of this, company can raise sufficient
amount of funds which is required for development and growth of organisation (Jussila,
Kärkkäinen and Aramo-Immonen, 2014). Also the leaders of company, make strategy
of donating books to various organisations,. These organisations work for the welfare
of small children who lives in slums and in orphanage. As a result, H&M increase their
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reputation and goodwill in market which help them in promoting their business. This
strategy help in enhancing the ranking of H&M.
 Food for needy: According to this strategy of H&M, they provide food to the needy
people which increases their goodwill and brand image at marketplace (Kozubíková
and et. al., 2015). This strategy of leaders and managers of the company again help
them in increasing their reputation and brand name at market and earn respect from
public. This as a result helps in increasing the profitability as well as company can grab
the attention of those investors who make investment in charity and for the welfare of
public. This act directly help H&M in making their image clean in society, which
increases the belief of public in company. With the help of this H&M increases their
ranking and credits at market place (Lubberink and et. al., 2017).
 Donation made while any miss happening arises: In current scenario, H&M is one of
the leading and successful organisation in the whole wide world. Along with making
their image clean at market place, company make different strategies and plans to
maintain their ranking. Whenever there is any miss happening occurs in the society,
H&M made donations and make their image clean while ultimately increase their
profitability. This act of H&M attract many investors towards their organisation, with
this they increase their market share and ranking in this competitive market. With the
help of this, it can be said that ranking of H&M will come to 56 from 57 (Rankings per
brand, 2019).
4. H&M’s approach to CSR influencing the purchasing decisions
With the help of above mentioned information, it can be said that H&M's corporate social
responsibilities has basically influenced purchasing decisions (Popovič and et. al., 2014). Along
with this, it has also been analysed that impact of corporate social responsibility has played a
crucial role for operations of H&M. All the actions taken by this company has generated a
positive impact on them. It has also resulted in a positive sense through which H&M has grabbed
attention of both investors as well as customers (Sprout and Sprout, 2015). This also make trust
in public that the huge part of H&M's profit margins goes for the needy persons by donating
funds and required materials like, food, books, any other. These all factors of good ethics, quality
products, charity work attract large amount of crowd towards products and services offered
through their business (Stieninger and Nedbal, 2014).
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These approaches of H&M helped them in influencing the purchasing decisions of
different customers in positive manner. As these strategies make a clear image for H&M in
public mind, and also help in attracting ample number of investors towards their organisation.
The impact of CSR strategies used by them was positive and this can be said as, they are able to
increase their sales and goodwill in market.
5. Relevancy in between current business environment and CSR of H&M
The corporate social responsibility includes activities which help in building profits and
brand image. The year of 2018 has proved to be an active year for CSR issues related to
globalization, sustainability and advocacy. The managers of H&M have to take care of the
following changes which are discussed below-
 Back to school (Vulnerable) : There are a number of issues in the workplace like
promising pay equity, sexual harassment and promoting sustainability. All such issues
make the operations in the organization complex. Leaders and managers of H&M
arranges various training sessions, peer to peer dialogues and formal classroom settings
in order to maintain level of changes and best practices in governance and accountability
(Wirtz and et. al., 2016).
 Equity joins diversity and inclusion : Earlier Organizations were focusing on diverseness
and situation but nowadays they takes care of equity in the treatment of customers and
employees rather than simply acknowledging and observing their variety. In present
context, H&M has kept its focus on equity and inclusion replace diversity and inclusion
as a priority in corporate social responsibility (Zhang, Chen and Ang, 2014).
 Identify adequate incentives : Every person has different aspect towards sustainability.
Managers evaluates the effect of doing CSR activities. Managers should know what
move people have to take and what helps them in performing activities which are related
to CSR. Managers and leaders of H&M should know the thinking of its employees and
they should know what are their opinions in performing activities related to corporate
social responsibility. This is done by the help of middle managers as these people spread
information to entire organization about CSR activities (Bargiela-Chiappini and
Nickerson, 2014). The CSR managers and leaders should ensure the language and
incentive is used for the right individual. Usually this active developing the long
relationships and daily conversations with other middle-managers throughout the entire
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organization. Then also, CSR managers of H&M should be sure about the language and
incentive that they using for the right peoples
This is a factor that helps in determination of the activity which will help in
improvisation of the society and people. CSR activities help in building good relation among the
society. This includes giving money to various non governmental organizations. CSR activities
can be done by the company through implementation of friendly and environmental policies at
their workplace. CSR activities are crucial for both employees and whole organization.
Companies ensure to conduct operations and management by following ethics and regulations if
they want to conduct CSR activities (Cheng, Yang and Sheu, 2014). When H&M is doing its
business in an ethical way different categories are considered which includes economic, social,
environmental impacts and thoughts of human rights. This can involve the range of activities like
working in partnership with local peoples.
CONCLUSION
From the above mentioned report it has been concluded that business context is an
essential element in a business concern which focusses on defining or ascertaining the
environment in which a business operates. It is quite important in relation to business planning
processes. This report focusses majorly on conduction of CSR activities in a business concern
which promotes its growth and sustainability as well. These activities tend to play a quite
essential role in profitability of a business which further provides a stable image in competitive
market as well. This report focusses on rationale of the company along with CSR's influence of
various buying decisions of a company.
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<https://www.rankingthebrands.com/Brand-detail.aspx?brandID=36>.
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