Hershey Company’s Ethical Standards

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Hershey Company has been in existence for over a century now. The organization deals with a wide range of products targeted at the diverse market segment of the entity. Over the years, the company has made major improvements on its brands, its products, and its management strategies. All these changes are geared at improving the competitiveness of the firm in the industry.

Hershey Company: The Nature, Structure, and Types of Products Offered by the Organization

Hershey Company is one of the leading chocolate producers in the world. It is associated with some of the most popular chocolate brands in the world. Some of its products include M&Ms, Payday, Reese’s, and Almond Joy (Brenner, 1999). Hershey operates in the rather sensitive food and beverages industry. Operations in this industry are regulated by a number of laws and rules put in place by the Food and Drug Administration (FDA). Hershey has developed a comprehensive code of ethical conduct to adhere to these rules. The operational standard is divided into four sections. The four entail the company’s commitment to its stakeholders, who include the employees, customers, and suppliers (D’Antonio, 2007).

Hershey’s Code of Conduct and Success Indicators

A critical analysis of Hershey’s code of conduct brings to the fore a number of major issues. In particular, three elements in this document are instrumental to the success of the company and its commitment to the stakeholders.

Commitment to stakeholders

First, the entity’s dedication and obligation towards its stakeholders ensures that the company works in a professional way (Newman & O’Connell, 2011). The element enhances proper management of records. The obligation is meant to ensure that the company is able to retrieve vital documents with ease when necessary. It also means that the organization is able to audit its activities in an efficient manner (Lawrence & Weber, 2014).

Addressing the needs of the customers

Hershey has made efforts to ensure that the needs of the different types of consumers are addressed. To this end, the company produces goods that are of high quality. In addition, it engages in ethical marketing strategies (Newman & O’Connell, 2011). The element is critical to the success of the company given the important role played by consumers in any business organization.

Commitment to the market

Hershey’s code of conduct indicates that the entity pays attention to the marketplace. The obligation ensures that the company maintains fair business practices that are favorable to the development and continuity of the chocolate products segment (Brenner, 1999). Obligation to the market enhances the competitiveness of Hershey, ensuring that the company maintains its leading position in the industry.

A Comparative Analysis between Hershey, Cadbury’s, and Nestle in Relation to Ethical Codes of Conduct

Cadbury’s Code of Conduct

The organization has continuously upheld the rules and regulations set by FDA with regards to food and beverage production. As far as the company’s code of conduct is concerned, it is apparent that the management has made significant steps to ensure that the entity maintains its commitment to its stakeholders, customers, and the market place. The scenario illustrates the similarity between Hershey and Cadbury’s in relation to their code of standards (D’Antonio, 2007).

With regards to its obligations to the stakeholders, Cadbury’s has effectively managed its records and official documents in a bid to maintain transparency. To cater for the needs of the customers, the entity produces a wide range of high quality products that are evident of its innovative and creative nature (D’Antonio, 2007). In addition, the management has maintained the consistency of the fresh branding and packaging of its products. As far as commitment to the market is concerned, Cadbury’s engages in fair business activity that is generally acceptable in the market (Newman & O’Connell, 2011).

Nestle’s Code of Conduct

The company maintains a recognizable market presence with such brands as KitKat. It works within the framework set by FDA. In addition, Nestle has indicated its devotion to the stakeholders, the customers, and the marketplace. The move creates another similarity between this company and the other two [Cadbury’s and Hershey] (Newman & O’Connell, 2011).

The Impacts of Ignoring the Three Issues

Cadbury’s and Nestle stand to benefit by maintaining their commitment to the market, customers, and stakeholders. An increase in profits will be evident since the brands will grow in popularity. Profits will also rise because the companies will diversify their products to fit the interests of a wide range of customers. The companies will also have a steady flow of money. Such can be achieved through careful documentation of transactions and proper record keeping (Carroll, 2009).

However, failure to follow and adhere to the guidelines above could be disastrous to Cadbury’s and Nestle. Sales will plummet and products will be poorly priced. As such, demand will decline significantly. Secondly, the companies will be affected by lawsuits due to unethical business practices, marketing strategies, and insensitive product packaging (Carroll, 2009).

Enhancing the Relevance of Hershey’s Code of Conduct: A Proposal

Hershey can adopt two techniques to make sure that its code of conduct remains relevant in the face of economic, political, social, cultural, and technical changes.

Promoting Relevance through Increased Market Presence

The firm can engage in research and development to improve its brand. Such improvements will make sure that Hershey fulfills its obligations to the stakeholders, the customers, and the market. By widening the range of its products to cover a bigger market, the company will be able to appeal to more customers. As such, Hershey’s code of conduct will be able to withstand the changing business environment. In addition, extensive market research is needed. The recommendations made from the market analyses should be made part of the production process (D’Antonio, 2007).

Relevance through Legal Teams

Changes in the business environment lead to the formulation of legislations to manage the process. To improve the efficiency of its code of ethical conduct over time, Hershey should formulate this document in a way that allows for revisions to accommodate future changes. In light of this, the company needs to invest in a legal team that will effectively interpret new laws and help revise the code of conduct where necessary (D’Antonio, 2007).

Managing Environmental Issues at Hershey

Currently, Hershey is engaged in a number of activities aimed at effectively managing environmental issues.

Recycling Disclaimers

Hershey’s products are packaged in colorful synthetic material. Customers are instructed on how to dispose of and recycle the material. The strategy is effective as it enhances the company’s responsibility with regards to the environment (Brenner, 1999).

Regulated Waste Management

Every production process leads to the generation of different categories of wastes. There are clear guidelines governing the management of such waste. Hershey has made a point of adhering to these policies. The strategy is effective in the conservation of the environment (D’Antonio, 2007).

Technology and Hershey Company

Customer Service

Hershey provides the customers with a wide range of channels of communication. Such channels include emails, toll-free lines, social media, and such others. The technologically savvy communication channels improve customer’s experience (Lawrence & Weber, 2014).

Online Marketing

Hershey has adopted social media as a marketing strategy. Using this strategy, the company is able to reach out to a wide range of customers in the market (Newman & O’Connell, 2011).

Future Technological Challenges

In spite of efforts to embrace technology, Hershey is likely to face a number of challenges that need to be addressed urgently. One potential impediment is competition. Competitors, such as Cadbury’s and Nestle, are using technological marketing strategies that are similar to those used by Hershey. As such, the management has to work extra hard to stand out in the industry (McMahon, 1998).

However, maintaining consistency could curb this challenge by cementing trust between customers and the company. Second, the switch from labor intensive manufacturing to capital dependent methods is quite expensive. As a result, Hershey incurs extra costs that may cause a dip in its profits. Third, the technological sector is quite dynamic. As such, obsolete technology needs regular upgrades and replacements, which increase costs of production (D’Antonio, 2007).

Hershey can overcome these challenges by updating the technology department. Similarly, allocation of funds to cover technological advancements could address this hurdle.

Lobbying Activities by Hershey to Influence National and Local Decisions in its Favor

In 2007, Hershey, together with other members of the US Chocolate Manufacturers Association, lobbied the FDA to allow them substitute cocoa butter with partially hydrogenated vegetable oils (Newman & O’Connell, 2011). In addition, the companies tried to convince the agency to change its legal definition of chocolate. However, the FDA refused to make these changes. The lobbying was disastrous to Hershey. It depicted the company as a profit oriented entity. Hershey disregarded the adverse effects that the products they were suggesting could have on the health of the consumers (Carroll, 2009).

Hershey’s Global Citizenship Efforts

Hershey has undertaken a number of global corporate citizenship initiatives. They include, among others, internationalization and global production.

Internationalization

Hershey has expanded its global distribution network. Its brands are available in different parts of the world. Furthermore, the company has diversified its brand to appeal to a wide range of customers. The internationalization concept has helped Hershey achieve its sales and marketing goals in the market (McMahon, 1998).

Global Production

Hershey has expanded its production depots around the world. The expansion means that the company is able to meet the needs of its customers in the global market. In addition, the move has enabled Hershey to diversify its products to fit the needs of different customers around the globe (D’Antonio, 2007).

Conclusion

The two global citizenship strategies will help Hershey to meet its long and short term sustainable development goals. The reason is that the company is able to appeal to a large number of consumers in the industry. In this paper, it was established that Hershey is a successful entity in the chocolate industry. However, the management should continue working hard to maintain the entity’s position in the market.

References

Brenner, J. (1999). The emperors of chocolate: Inside the secret world of Hershey and Mars. New York: Random House. Web.

Carroll, C. (2009). Defying a reputational crisis- Cadbury’s salmonella scare: Why are customers willing to forgive and forget?. Corporate Reputation Review, 12(1), 64-82. Web.

D’Antonio, M. (2007). Hershey: Milton S. Hershey’s extraordinary life of wealth, empire, and utopian dreams. New York: Simon & Schuster. Web.

Lawrence, A., & Weber, J. (2014). Business and society: Stakeholders, ethics, public policy (14th ed.). New York: McGraw-Hill. Web.

McMahon, J. D. (1998). Built on chocolate: The story of the Hershey Chocolate Company. Santa Monica, CA: General Publishers Group. Web.

Newman, T., & O’Connell, E. (2011). Still time to raise the bar: The real corporate social responsibility report for the Hershey Company. Web.

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