Business Ethics Case Study: Nestle And Society

Nestlé and Society
Nestle through its policies has communicated the principle of sustainable development. 2006 was a change year for Nestle, the company made contracts with foundation strategy group. That was a non- profit organization which specialty is strategy consultation, evaluation and research. The alliance was resulted by the efforts of Mark Kramer and Michael Porter who were founders. The aim of this alliance was to study the Nestlé’s social responsibility practices and give recommendations by which the company can bring betterment in its CSR practices. This was an important corporate strategy that resulted in both social value and the economic value for the company.
This collaboration made a strategy to implement the idea of creating

The pyramid reflects the activities through which company could interact with the society. The pyramid is based on three levels, the compliance, sustainability, and creating the shared value.
The compliance deals with the regulations and antinational laws which company has to follow. These include “United Nations Millennium Development Goals”, code of conducts as well as Nestlé’s own values and principles. All of these principles provide a guideline through which company can interact with society for mutual benefit. These all principles are written in company’s corporate business principles.
Creating Shared Value Strategy
Nestle has developed creating shared value strategy that aimed to meet the consumer and stakeholders needs. It was a long-term planning strategy that elaborates every single investment in term of sustainable value for the business or the society. This strategy utilizes the core business strategies to generate economic values for both, the society and the business. The aim of this strategy was to serve consumer with healthy foods.
Critically Evaluation of The Strategies Adopted By Nestle
The Nestle

The strategy of Nestle to buy directly from farmers is a very effective example of CSR practice. The farmer gained direct of advantage from this strategy as well as the company gained a competitive advantage by differential strategy. The competitive advantage is justified as the most important output of CSR practices (Kurucz, 2008). Nestle gained brand image that also affects the profitability rate of the company. The competitive advantage is described as one of the top justification of CSR practices Fortune (2003). The Nestle initiative of saving water resources was a unique strategy and as suggested by Smith (2003) that if an organization’s CSR strategy is genuinely considered than it will bring the unique competitive advantage to the firm. And this uniqueness will set standards for the competitors. Pavito et al., (2008) suggested that the corporate social responsibility is also associated with increasing the brand loyalty. Bhattacharya and Sen (20040 argued that competitive advantage of a firm as a result of corporate social responsibility practices will also attract the future investments. These all factors have contributed the profitability of a business as in case of