Strategic Corporate Social Responsibility Report: A Tesco Analysis

This report provides a comprehensive analysis of Tesco's strategic corporate social responsibility (CSR) initiatives. It begins by outlining arguments for CSR, emphasizing its alignment with both internal and external objectives, such as environmental efforts, philanthropy, ethical labor practices, and employee volunteering. The report then assesses the impact of CSR strategies on stakeholders, including employees, shareholders, suppliers, customers, and governmental bodies, highlighting the importance of ethical and socially responsible business practices. It reviews Tesco's strategies using Mintzberg's 5 P's model to ensure alignment with CSR goals. Furthermore, the report proposes a CSR strategy for Tesco, emphasizing profitability, alignment with core purpose, customer understanding, and focusing on relevant issues. It concludes by outlining methods for measuring the impact of CSR, including internal and external reporting, and strategies for refreshing and reinforcing the CSR approach. The report underscores the benefits of an effective CSR strategy in enhancing employee involvement, fostering innovation, and promoting a sense of shared purpose within the organization.

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Strategic Corporate Social
Responsibility
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TABLE OF CONTENTS
INTRODUCTION................................................................................................................................3
TASK 1.................................................................................................................................................3
AC 1.1 Arguments for CSR related with internal and external objectives......................................3
AC 1.2 Impact of CSR strategies on internal and external stakeholders.........................................4
AC 1.3 Review of company's strategies for alignment with CSR strategies...................................5
AC 1.4 Corporate social responsibility strategy that supports company's objectives.....................6
Task 2....................................................................................................................................................7
AC 2.1 Company’s value chain for alignment with CSR strategy..................................................7
AC 2.2 Methods for agreement and engagement with all stakeholders for CSR strategy..............8
AC 2.3 Implementation plan for CSR strategy................................................................................9
Task 3..................................................................................................................................................10
AC 3.1 Internal report measurement for evaluating the impact of CSR strategy..........................10
AC 3.2 External reporting measurements to evaluate impact of CSR strategy.............................10
AC 3.3 Methods to refresh and reinforce CSR strategy................................................................11
CONCLUSION..................................................................................................................................12
REFERENCES...................................................................................................................................14

INTRODUCTION
With the rapidly changing expectations and demands of consumers, employees and
regulators, becoming the best in world is a tough job. Business organisations are now also expected
to be the best in the world i.e. to socially and environmentally responsible, sustainable and ethical.
Business owners are required to know the way of creating shared value and managing stakeholders
along with employees and the community in which they are operating (Guzman and Becker Olsen,
2010). This is important because of the financial, moral and relational reasons. Strategic corporate
social responsibility is about integrating the strategies, core activities and competitive advantage
with social responsibilities of company. This report is prepared to understand the background of
strategic CSR in context of Tesco. The report will include arguments for CSR along with methods
for agreement and involvement with all stakeholders.
TASK 1
AC 1.1 Arguments for CSR related with internal and external objectives
Corporate social responsibility refers to those business practices which include initiatives
that benefits the society. It consists of a wide range of tactics consisting of offering a part of
company's profits to charity to implementing “greener” business operations. Below are the
following arguments that comply with internal and external objectives of cited firm, Tesco:
 Environmental Efforts: If the organisation focuses on environmental issues and make sure
to minimise the damages that it is giving to natural resources then external objectives are
achieved in relation with the corporate social responsibility.
 Philanthropy: When Tesco will donate to the local and national charities, it will be making
a positive impact on the external shareholders. This in turn will help in accomplishing the
external objectives. The firm is having adequate resources which can benefit charities and
local community programs (Werther and Chandler, 2010).
 Ethical labour practices: By treating the employees in a fair, just and ethical manner, cited
firm can demonstrate its corporate social responsibility. It will benefit the company to a
large extent as if the employees who are internal stakeholders will be happy and satisfied
then it will reflect their productivity and performance.
 Volunteering: Attending volunteer events and programs tell a lot about a company's
sincerity. By doing good work without expecting anything in return, Tesco will be able to
show their concern for particular issues which will support it in achieving the external
objectives.
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Undertaking corporate social responsible initiatives is truly a win-win situation for Tesco.
This will not only appeal to socially concerned consumers and employees but it will also make a
real difference in the corporate world. As the consumers are becoming smarter about global issues
and trends, it is important for organisation to give attention to corporate social responsibility. By
doing this, company will receive positive responses (Orlitzky Siegel and Waldman, 2011).
Aforementioned initiatives when engaged in the current business processes can increase
brand value of Tesco. Corporate strategy which has ethical governance and employee motivation as
the prime objectives can help in supporting these initiatives. Moreover, the company has to develop
its corporate strategy which has more concern towards people and environment for attaining
sustainability. Hence, the proposed corporate strategy is to develop a technique which can grab
more attention of potential customers. The investment of resources for crafting business portfolio
and developing more brand value is the corporate strategy of company.
AC 1.2 Impact of CSR strategies on internal and external stakeholders
If Tesco does not have honesty and integrity then it would not be able to build strong
relationships with any of its stakeholders. Stakeholders lay down the foundation for success and
failure of any business enterprise. They have interests, rights or ownership in a company and its
activities. The internal or primary stakeholder of cited firm are suppliers, employees and
shareholders. Every one of them has a concern that how the firm is performing and interacting with
them. These stakeholders can get benefitted by the success and growth of cited organisation also get
harmed by its errors (McWilliams and Siegel, 2010). Secondary or external stakeholders are also
important as they can take action which can harm or support the firm. These include government,
unions, non-governmental organisations, activities, political action groups and media.
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Organisation should adopt the model of corporate social responsibility to serve their
stakeholders in an ethical and social manner. If the cited organisation develops ethical and social
elements in its operating philosophy and align them in its business model, it will possess a self
regulating mechanism that guides, monitors and assures adherence to law, ethics and norms in the
functioning of business. It ensures the serving of interests to all stakeholders. The motive of being
socially responsible business firm is accomplished when its activities fulfil the expectations and
desires of all its stakeholders (Peloza and Shang, 2011).
There can be primary or secondary expectations for the stakeholders. Primarily, they expect
a return on investment in the shares. Secondary expectation is to add value to their assets. For the
employees, their key concern is getting enough pay scales before work satisfaction. The customers
are concerned more about supply of products and services more than the quality of product. For the
creditors, primary concern is credit worthiness and then security. Quick payment is expected by the
suppliers first and then long term relationships are expected. The government and its organisations
are concerned primarily about compliance to laws and policies and then it is expected to increase
competitiveness. Community is concerned about the safety and security in their regions. After that,
they expect contribution that will benefit them.
For instance, Tesco develops a corporate social responsibility of giving 2% of the total profit
which is acquired by the company every month to the orphanages and old-age homes in UK. This
CSR strategy is considered as a philanthropic approach towards business functioning. Considering
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Illustration 1: Types of stakeholders
(Source: Hellriegel, Jackson and Slocum, 2009)

the primary stakeholders, this strategy shall help the company to develop a positive image in eyes of
employees and suppliers. On the other hand, there can be some sort of clashes and oppositions from
shareholders because they might not be willing to share their profits. Hence, a mixed reaction will
be assessed by Tesco after implementation of this CSR strategy. Considering secondary
stakeholders, non-governmental organisations will support firm in this decision. Moreover,
consumers will develop a thinking that their investment in terms of purchase is for good of the
needy people.
AC 1.3 Review of company's strategies for alignment with CSR strategies
To revise the company's strategies aligning with CSR strategies, Mintzberg's developed 5 P's
strategic model to develop them. With the help of following model, Tesco has to revise company's
strategies which is like
Strategy as a plan: Planning is something with which many managers are comfortable. And
it comes naturally in managers. The cited firm can align CSR strategies with planning. Under this,
strategies will be formed as a plan in which some sort of consciously intended course of action and
guideline or a combination of guidelines to handle a situation are there.
Strategy as a ploy: Under this strategy, firm can get better competitors by plotting to disturb,
dissuade, discourage or otherwise impact them. Here, the strategy can be a ploy as well as a plan.
Through this, organisation can make a large impact on its rivals to gain competitive advantage.
Strategy as a pattern: If strategies can be intended as plans or ploys, they can be realised
too. In simple words, defining the strategies as a plan is not adequate. There is a need to define it in
terms of resulting behaviour. Under this, strategy as a pattern has a stream of actions. The definition
of strategy as a plan and pattern are independent on each other (Dhaliwal Tsang and Yang, 2011).
Plans may be unrealised whereas patterns may emerge without preconception. Plans are deliberate
strategies while patterns are realised strategies. By this, cited company can distinguish the intended
strategies where intentions which exist previously are realised and then, emerging strategies where
patterns are developed in the absence of intentions or despite them are realised.
Strategy as a position: Strategy as a position particularly refers to locate the cited firm in an
“environment”. With this definition, strategy becomes the mediating force or a fit between the
organisation and environment i.e. in the context of internal and external.
Strategy as a perspective: Strategies as perspective include not just a selected position but a
deep-rooted way of perceiving the world. Key importance is that strategy is a perspective shared by
members in the organisation by their intentions and or actions (Sekhar Bhattacharyya, 2010).
The corporate strategy and CSR strategy that has been proposed by Tesco are interlinked.
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Corporate strategy aims to increase company's brand value and grab more market share in terms of
customers. The proposal that has been made through CSR strategy helps in acquiring this customer
attention by the good deeds of Tesco. Moreover, a significant advantage is gained by organisation
because of the amalgamation of these two strategies.
AC 1.4 Corporate social responsibility strategy that supports company's objectives
To develop corporate social responsibility strategy, Tesco can follow the following steps:1. Insist on profitability: The top managers in firm have to focus on business value, not on
philanthropy or managing NGO or for marketing purpose. Company needs to think wisely
about the way in which corporate responsibility can help in saving or making money with
meeting challenge to fulfil the needs of society (Michelon Boesso and Kumar, 2013).2. Alignment with key purpose: Core purpose of firm should be the beacon for finding a
valuable CSR strategy. Strategies must be linked with the core purpose of company. An
effective and sustainable strategy relates the customer, society and business and it does not
compromise on these terms.3. Understand customers: Company needs to understand the diversity among customers and
should not draw a picture of them which may be inaccurate. Tesco is required to know its
customers, the way they fall on this spectrum and also, the manner in which these strategies
will change over the life of their products.4. Focus on the right issues: Corporate social responsibility and sustainability apply to a varied
range of issues. The cited firm, Tesco should pay attention on environmental and energy
issues as they are more relevant as compared to the local economic opportunities.5. Use the organisation properly: Company is needed to support the search for value, reinforce
the principles to make corporate strategy effective and profitable as well as to protect it in
initial stages (Aguinis and Glavas, 2012).
6. Other benefits: An effective CSR strategy will help the firm in employee involvement,
innovation and cooperation. Apart from these, the most important benefit is corporate
responsibility changes the views and opinions of cited firm i.e. “them” to “us”.
The aforementioned strategies are aligned with corporate strategy of Tesco. In order to
support the internal and external objectives of firm, following corporate social responsibility has
been proposed:
 Developing guidelines reflecting CSR: The individuals who are working for Tesco shall
align their activities according to CSR principles if they are aware about basic guidelines
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and regulations. It is possible that collecting all sorts of wastes in one particular bin would
not be an issue for normal people but this has a negative impact over environment. When
guidelines are developed and provided, individuals will be able to correct their actions.
 Evaluating the impact of actions: Every strategy that is to be developed and executed must
have some sort of impact over environment. Tesco needs to evaluate this impact and
generate its correlation with CSR. This shall take a step ahead towards sustainability.
 Recruitment and selection by using CSR: Enthusiastic, educated and talented individuals
who display support and value for organisation's initiatives and philanthropies are
considered in CSR. The basic corporate social responsibility denotes that Tesco need not
recruit in large quantities but focus on qualities that can take the CSR program way farther
from the vision.
TASK 2
AC 2.1 Company’s value chain for alignment with CSR strategy
Tesco can take Porter's value chain analysis to integrate them with CSR strategy. The
diagram here divides activities into primary and support activities as proposed by Porter:
Primary activities Inbound logistics: It refers to goods obtained from the suppliers of company and to be used
for manufacturing the final product. Operations: Here, raw materials and goods are transformed into the end product. Value is
added to the product in this stage as it shifts through the production line.
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Illustration 2: Porter's value chain
(Source: Porter's Value Chain 2016)

 Outbound logistics: When the products are manufactured, they are ready to be distributed to
distribution centres, wholesalers, retailers or customers. Distribution of finished goods is
called as outbound logistics. Marketing and sales: Marketing of Tesco has to assure that the product is targeted towards
the right customer group. To establish an effective strategy, marketing mix is used (Thorne
Ferrell and Ferrell, 2010).
 Services: The organisation has to provide services to its customers after the product or
service has been sold. This can be done in the form of after sales training, guarantees and
warranties.
Support activities Procurement: This department of Tesco has to source raw material for the cited firm and
gain the best price for doing same. To obtain the best possible quality available for their
budget is the challenge for procurement. Technology development: In today's technological driven environment, the use of technology
is necessary to gain competitive advantage. Human resource management: To achieve success, Tesco has to recruit, train and develop
the right people.
 Firm infrastructure: Tesco needs to assure that their finance, legal structure and
management structure would work efficiently. Inefficient infrastructure waste resources, can
impact the reputation of the firm (Du Bhattacharya and Sen, 2010).
The primary and secondary activities of Tesco depict that its strategic intent is to deliver best
in class quality products. Moreover, the value chain depicts that company's current activities are not
exactly aligned with corporate social responsibilities. These analytical details also depict that firm
intends to maximise its profits and stay ahead in competition no matter what the circumstances are.
Hence, when considering alignment with CSR, Tesco lacks certain aspects and need to revise its
strategies.
AC 2.2 Methods for agreement and engagement with all stakeholders for CSR strategy
Engage is only a six letter word but it means a great deal and can make a difference between
success and failure when it comes to firm's sustainability and CSR contributions. If the cited
company, Tesco, follow three simple steps, it will be able to build an effective engagement program.
These steps are elaborated here:
Identify the stakeholders: Many business firms often leave or ignore the important
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exercise of stakeholder mapping. It is a procedure of clearly defining the areas of interest of
customers, competitors, industry associations, NGO's, employees, etc. and then, identifying each
category specifically who falls into these areas (Bondy Moon and Matten, 2012). Along with this,
how relevant that stakeholder is to the company is also to assessed.
Develop an issue map: Now, when it is determined that who are the stakeholders and how
important they are, the core issues that will make an impact on the business will be assessed. Simple
steps to develop a map includes determining the list of material issues, overlay the list with
stakeholders and focus on the major geographic spheres of influence. These simple steps will aid in
creating a map that will decide the engagement plan.
Create an engagement plan: The last step in this process is formulating a plan with
detailed time-frames resulting in particular actions. Few points to remember while outlining the
plan are:
 Revising the engagement plan regularly throughout the year (it can be on quarterly basis)
 Checking the progress against goals on monthly basis
 Assuring to identify specific metrics for measuring the progress
 Using metrics to assess the effectiveness of efforts.
When implementing these methods for internal stakeholder groups say employees and
shareholder, the engagement plans enlightens various issues and problems which are faced by these
individuals while working in Tesco. The benefits experienced by employees after getting involved
with corporate social responsibility strategy of Tesco, are stated below:
 Timely recognition and fulfilment of legitimate needs of employees is guaranteed according
to proposed CSR strategy.
 The opportunities to participate and explore other skills and talents increases.
 More flexibility towards work is attained.
When Tesco communicates such benefits to this stakeholder groups, their agreement for
proposed strategy will increase. In similar manner, the company needs to communicate maximum
benefits which will be experienced by particular groups of stakeholders so that their probability of
agreeing with a situation increases.
AC 2.3 Implementation plan for CSR strategy
To implement the CSR strategy, following plan is proposed:
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 Develop a vision: The plan will start with an awareness of what the organisation is and what
does it believe as a business firm. It has to answer questions about core beliefs, business
strategies and models of success. The programmes developed for incorporating CSR should
be in alignment with the developed vision. Don't just talk a good game: Now, the cited organisation has to take a moment to find out
the way in which programs matches well with the present products and processes. When the
firm is looking for socially responsible programs, it has to strive to promote its business
along with the business practices. Launch strong and monitor intensely: After designing CSR strategies, spreading awareness
and implementing the initiatives effectively as well as creating ongoing procedures for
monitoring to check if the initiatives are working well or not. Monitoring the success of
CSR strategies and to assess that to what extent it aligns with the established business
practices is really important (Arendt and Brettel, 2010). Consider customer's needs and preferences: Assessing CSR strategies in context of fulfilling
the needs of customers is significant. Most of the people support ethical business practices.
Cited company has to keep customers’ needs and desires in mind while promoting or
adopting expensive programs.
 Use CSR to enhance talent recruitment: By practising and implementing CSR programs, the
Tesco will be able to attract enthusiastic, educated and talented employees who value the
CSR initiatives and philosophies. When the organisation is filled with people who encourage
and engage themselves with firm's CSR programs and who sincerely believe in its values, it
is very easy to align, maintain and promote such programs into routine operations.
TASK 3
AC 3.1 Internal report measurement for evaluating the impact of CSR strategy
There are various approaches which Tesco can use for specific measurement of the impact
of corporate social responsibility strategy. Balance scorecard and EFQM model helps the
organisation in doing strategic planning and management. Measurement system of organisation is
strong as it affects the activities of workers wand leaders (Arvidsson, 2010). As traditional approach
focuses only on financial measure, new approaches help the organisation to focus on all initiatives
which are good for sustainable growth of organisation.
Balance Scorecard
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