And What About Profit and Competitiveness? The Kraft Foods Case

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Change should always start at some point. Probaby the smaller the change is, the easier it is to make it. But what happens when a big organisation, not to say a corporate dinosaur, is trying to redefine its strategy towards a more sustainable way of doing business?

Kraft Foods realised 20 years ago what many companies are just starting to realise: that Corporate Sustainability and Responsability really matter. It is not only about pressure from NGOs and governments, but also about competitive advantage and therefore, about profits.

Philip A. Hodges, Senior Vice President Supply Chain of Kraft Foods, spoke today at the WRF in Davos about the quest for sustainabiliy that Kraft Foods started during the 90s. He highlighted some actions that should be taken when trying to achieve sustainability:

1. Sustainability should be treated as a fundamental part of the business, and consistency is extremely important not to lose credibility.

2. Due to the complexity and broadness of the subject, focusing is necessary; if you want to do too much, you end doing nothing. It is better to focus on what you can manage and deliver. Set targets.

3. Taking into account that corporate culture and employee’s engagement are essential.

4. Working in partnerships.

Mr. Hodges also mentioned that sustainability definitely provides competitive advantage, but only in the short-term.

We made an interview with him that you can listen to here:

Sustainability and Business – Interview with Philip Hodges from Kraft Foods by Studentreporter

Some multinationals started leveling the playing field, as Kraft Foods did, and now many others have followed.

The corporations that haven’t even thought about changing should start very soon. Not pursuing sustainability is starting to become a competitive disadvantage and to affect the public relations and corporate image of companies. Stakeholders’ awareness is growing and many examples are out there to prove it.

One example can be found in the textiles industry (H&M, Puma, Adidas and Nike). After international pressure, these four clothing giants committed to eliminate discharges of all hazardous chemicals across their entire supply chains, and their entire product life-cycle by 2020. H&M has also agreed (H&M’s commitment) to publicise information (by 2012) about chemicals being released from its suppliers’ factories.

After another campaign from Greenpeace, the “Kit Kat Campaign“, Nestlé committed to stop using products that come from rainforest destruction (e.g. palm oil).

If you would like to know some obscure and shifty facts about corporations and start acting, I would recommend you to watch “The Light Bulb Conspiracy” by Cosima Dannoritzer.

You can’t stop it. Media is empowering people and giving them the tools to exert more pressure.

What are you going to do about it?

2 thoughts on “And What About Profit and Competitiveness? The Kraft Foods Case

  1. It´s great that multinational companies are changing to the right way, but everyone´s change is necesary. Only bilions of small changes will save this planet and it´s life.

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