Challenges in the Global Business Environment, Essay Example

The Coca-Cola it Company utilizes lobbying as a major strategy to ensure that it will continue to be successful. Currently, it has a total of 38 lobbyists at 7 different firms, emphasizing the importance of political decisions to the organization. An extreme example of how lobbying has benefited the company during its history occurred during the 2000’s. The Pepsi Company had filed a suit complaining that the Cola-Cola Company had held Monopolistic Competition. However, in 2000, a United States federal judge dismissed the case. This agreement was a consequence of lobbying, in which major political figures in power benefitted from the results of this case as well. Additionally, at the same time, the company had a plan in place in Europe in which shops and bars agreed to only stock Cola-Cola products (BBC News, 2005). In Mexico, the company was fined $68 million for similar reasons. Currently, criticism against these business practices are being appealed.

This lobbying effort was not appropriate because it is clear that the Coca-Cola Company had violated antitrust laws that had been in place in several different countries, including the United States, in which the company is based. Typically, lobbyists gain the favor of politicians by offering them some sort of advantage if a policy is regulated in a manner that is desirable for the company. This is an unethical practice, as politicians are expected to represent the beliefs of their constituents. However, they often agree to terms that would solely benefit themselves. Corporations such as Coca-Cola take advantage of this during the lobbying process because they have a lot to offer politicians that agree to their terms, which allows them to become more persuasive. For example, many politicians are Cola-Cola stockholders, and are reminded by lobbyists how their policy votes will impact the value of their stock. While lobbying is a somewhat unethical practice, it is not illegal and also effective.

Corporate citizenship is defined as the obligations that organizations have to their communities. An essential global corporate citizenship effort that makes the Coca-Cola Company widely popular in the United States is its philanthropic activities. It has done so by forming the Coca-Cola Foundation, which has awarded “$98 million in 2013 to impact approximately 134 million people in 122 countries” (Coca-Cola, 2013). Currently, this organization is focusing their efforts on the economic empowerment and entrepreneurship of women, access to clean water, water conservation and recycling, and active healthy living, education and youth development. Coca-Cola has personally reinforced its sustainability value by utilizing bottles with less plastic and reminding its customers to recycle.

Coca-Cola’s sustainability plan could be more effective if it returned back to the packaging methods it has used during the time of the company’s founding. Rather than expecting bottles to be recycled by the individual, bottles should be brought back to the factories or stores that sell them, and brought back to the factory directly to be cleaned and reused. In addition, the glass bottles that were used originally were more environmentally friendly and should be brought back into use. These bottles are stronger, easier to clean, and last longer. Therefore, it is ideal to utilize bottle materials that are truly environmentally friendly to emphasize a company’s sustainability.

Coca-Cola’s attempts to promote water conservation is an additional global citizenship effort that could be used to contribute significantly to the company’s sustainable development goals. The company issues grants for water and sanitation, although it could contribute to the cause more directly by implementing conservation in their own business practices. For example, the factories could be optimized to use low levels of energy and water, while still providing the same output. Large factories are known to have a large waste output because it is cost efficient, but these practices can easily be reduced with time and financial investment.

References

BBC News. (2005). EU Makes Coke Throw Open Fridges. Retrieved from http://news.bbc.co.uk/2/hi/business/4119372.stm

Coca-Cola. (2013). The Coca-Cola Foundation. Retrieved from http://www.coca- colacompany.com/our-company/the-coca-cola-foundation