ISSUES
: Business and Trade
Chapter 2: Corporate responsibility
24
in an explosion at its refinery
in Texas City. In his book, Lord
Browne names Texas City as one
of two significant incidents – the
other was an oil spill in Alaska –
that marred the end of his tenure
as chief executive.
The Deepwater Horizon oil spill,
which has cost the group around
$54 billion in penalties, damages and
clean-up costs, began on 20 April,
2010, and continued to flow for 87
days. Deepwater is considered the
largest accidental marine oil spill in
the history of the oil industry.
Johnson & Johnson and
Tylenol
In 1982 seven people in Chicago
died after taking extra-strong Tylenol
(paracetamol) capsules which had
been laced with cyanide as part of an
extortion plot. The pharmaceuticals
group acted swiftly and behaved
openly, recalling all of the product –
at a cost of $100 million – and setting
up toll-free numbers for concerned
customers. Lord Browne argues that
because the company responded
so quickly and transparently, it soon
regained market share – and its
reputation.
The Toyota accelerator
scandal
Toyota, the Japanese car giant,
agreed to pay out around $1.1 billion
in late 2012 to settle a class action
lawsuit stemming from complaints
of unintended acceleration in its
vehicles. The case badly soured its
reputation for safety and affected
sales. Owners of around 16 million
Toyota vehicles were eligible for
compensation and safety checks. It
was alleged that 21 deaths had been
caused by the defect, also known as
‘sticky pedal’.
26 September 2015
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As companies embrace
the circular economy, are
they missing a trick?
By Rachel Butler
O
ur approach to using natural
resources has changed
dramatically over the last ten
years, with companies becoming
more aware of the need to shift from
a linear production model of take–
make–dispose, to a more responsible
model which considers the full
product lifecycle. This has placed
greater focus on reducing waste
and negative environmental impact.
In response, many businesses are
creating innovative ways of re-using
and recycling the surplus and waste
materials companies and consumers
produce.
But are many of today’s companies
missing an obvious and simple
opportunity to contribute positively
to a circular society? Talk of a circular
economy is high on the agenda
thanks to organisations like the Ellen
MacArthur Foundation. However,
making this a reality may be many
years away. In the meantime, our
manufacturing and retail industries
have a massive opportunity to
use their products to support
communities both locally and across
the globe, demonstrating they are
socially responsible brands.
For the last 19 years, the charity In
Kind Direct has been working with
over 1,000 companies to unlock the
potential of their surplus goods, re-
distributing them to UK charities and
social enterprises working at home
and abroad to help develop thriving,
resilient communities. The model
is a simple one: companies donate
their products to In Kind Direct which
acts as a logistics ‘middle man’,
enabling thousands of small grass
roots organisations to access the
goods they need to run their services
or give to people in need. The effect
is dramatic. To date an estimated
13,000 tonnes of product have
been diverted into productive use,
enabling over 7,500 charities to save
money and help millions of people
every year, including some of the
most vulnerable in our society.
So why is product donation not a
core part of every manufacturer’s
model?
