New Belgium Brewing: Social Responsibility as a Competitive Advantage Essay
1. What environmental issues does the New Belgium Brewing Company work to address? How has NBB taken a strategic approach to addressing these issues? Why do you think the company has taken such a strong stance toward sustainability? New Belgium Brewing Co. (NBB) is a craft beer leader that embraces sustainability and corporate responsibility. For New Belgium, social, ethical, and environmental responsibilities are as important to the company’s operations as profitability.
For New Belgium, business is as much about improving the local community as it is about making beer. From its inception, New Belgium Brewing has sought to minimize resource consumption, maximize energy efficiency, and redefine waste. In 1999, New Belgium became the US first brewery to subscribe to wind energy. By treating process waste water onsite, New Belgium is able to produce 15% of its total energy needs. In 2009, New Belgium implemented the largest private array of solar panels in Colorado; 870 panels mounted atop the bottling facility produce over 200 kW of power onsite.
New Belgium has also adopted green building practices throughout the brewing facility and has incorporated innovative engineering and design in its operations. New Belgium believes that making choices that are environmentally sustainable or enriching for the society is just good business sense. New Belgium has taken such a strong stance toward sustainability based on its belief that doing the right thing pays.
2. Do you agree that New Belgium’s focus on social responsibility provides a key competitive advantage? Why or why not? A growing body of evidence asserts that corporations can do well by doing ood. Well-known companies have already proven that they can differentiate their brands and reputations, as well as their products and services, if they take responsibility for the well-being of the societies and environments in which they operate. These companies are practicing social responsibility in a manner that generates significant returns to their businesses. Social responsibility makes a company more competitive and reduces the risk of sudden damage to the company’s reputation and sales. New Belgium saw social responsibility as part of a continuing process of building value. Social responsibility helps improve the company’s reputation, and establish long-term relationships with customers and other stakeholders.
3. What are the challenges associated with combining the need for growth with the need to maintain customer intimacy and social responsibility? Does NBB risk losing focus on its core beliefs if it grows too quickly? Explain. The main reason any company would object to maintain customer intimacy and social responsibility is the associated costs. With social responsibility, a company pays for environmental programs, more employee training and efficient waste management programs.
Proponents of social responsibility agree that any expenses to businesses are ultimately covered by stronger relationships with key stakeholders. However, some argue that investment in social responsibility programs may not necessary result in measurable financial results. Another challenge for companies when considering social responsibility is the possible negative perception of shareholders. Historically, publicly-owned companies had a primary focus of maximizing shareholder value. Now, they must balance the financial expectations of company owners with the social and environmental requirements of other stakeholder groups.
Some shareholders are happy to invest in companies that operate with high integrity. Others may not approve of the expenses of operating under social responsibility guidelines. New Belgium decided to capitalize on customer intimacy and social responsibility right from the start. New Belgium believes that, when managed effectively, social responsibility programs and projects can create significant benefits in terms of reputation and returns as well as the motivation and loyalty of employees. I don’t think NBB would risk losing focus on its core beliefs as it grows.
4. Some segments of society contend that companies that sell alcoholic beverages and tobacco products cannot be socially responsible organizations because of the nature of their products. Do you believe that New Belgium’s actions and initiatives are indicative of a socially responsible corporation? Why or why not? As a company that produces alcoholic beverages, New Belgium targets a specific market – men ages 25 to 44. While the company promotes its beer it also encourages “the responsible enjoyment of beer” (New Belgium website).
Such promotion falls into place with New Belgium’s strategic objective that aims to remain a business role model by “kindling social, environmental and cultural change”. It is a social responsibility of the company to educate the consumer of the affects of the product, while also encouraging the responsibility of the consumer itself. New Belgium successfully ties in the cultural and social perspectives of responsible consumption of beer. It is, therefore, a socially responsible corporation. *Textbook: Marketing Management Strategies, Ferrell, 5th edition