Question

Diageo, the producer of alcoholic drinks including Guinness, Smirnoff and Baileys, has withdrawn its projections for 2020 sales and profits as the negative impact of COVID-19 on its business could not yet be assessed. “During this challenging time, our top priority is to safeguard the health and well-being of our people, while taking necessary action to protect our business," said Ivan Menezes, CEO, Diageo. As COVID-19 spread, Diageo pledged to donate 2 million liters of alcohol to manufacturing partners around the world including the US, UK, Brazil, Australia, India, Kenya and Ireland, supporting the production of hand sanitiser to help overcome the shortages in healthcare systems and protect frontline staff. “This is the quickest and most effective way for us to meet the surging demand for hand sanitiser around the world,” said Menezes. In Ireland, Diageo announced a €1.5m fund to support bar staff, and also elderly and vulnerable people through a partnership with ALONE, the Irish charity that supports older people at home. The ALONE partnership builds on one already in place with Guinness addressing isolation among the elderly community. The fund is part of a wider initiative which will see Diageo pledge millions globally to communities and the bar trade impacted by the COVID-19 crisis. Critically review the approach of Diageo applying at least 2 CSR frameworks or theories. Support your answer using relevant and appropriate examples and module materials.

Answer 1

The corporations are responsible for the society because it uses the resources given by the club. The companies have responsibilities towards the society in general to maintain a good reputation in the league. The organizations should understand that profit-making shouldn't be their only motive, and they should also do something for the company. It will also enhance their advertisement and image in the market. The first concept that should focus upon is the Corporate Social Responsibility. The name itself suggests that it is concerned with the fact that enterprises should not only have their motive as profit-making but also to stay connected to society. The firms should have economic responsibility, legal responsibility, and ethical responsibility. For example, in the given scenario, Diageo has the financial responsibility of making a profit for its growth. The firm's moral responsibility is to help in the manufacturing of sanitizers, which are an essential requirement today. The legal responsibility is the conformity with the laws of the country. The next framework is called the triple bottom line. The concept says that the company's bottom-line results are not only based on profit but also on the social reality that is crucial into account. The company should maintain sustainability in its processes by establishing a balance between the two factors. For example, Diageo has set a good illustration for the triple bottom line concept because it is making profits as well as helping the society at large. So, the two concepts of social responsibility should consider to gain better results and success.