Philips Stakeholders & Corporate Social Responsibility Essay

Philips employees work in different divisions: Healthcare, Lighting, Consumer Lifestyle and Innovation & Emerging Businesses. Within these divisions, you can have a general leadership position, occupy a functional leadership position, you can be specialist, etc. Philips says it’s giving its employees freedom to develop and improve their skills and talents, it is challenging them to grow. Its employees therefore, are given an high responsibility, but they can also contribute their new ideas.

Because when you work at Philips, “you need to be willing to take ownership of your projects and feel accountable for delivering superior results. ” Philips says it’s trying to attract diverse people in a workplace environment wherein “people are valued for who they are (not what they are)”. This is necessary, because Philips also has international teams, since it has become a global leader in electronics. With this statement for its employees, Philips says it’s able to make better decisions, and it’s getting closer to its customers.

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But of course, these employees have a certain influence on the customers who buy at Philips. They therefore have to behave according to certain rules (Philips ‘General Business Principles’), otherwise employees could be able to destroy the image of the company. They have to stay focused and they have to try to improve quality at all times, and, most important: they have to be and stay committed to Philips values. But this also works the other way around; when Philips shop managers do their best with helping someone who enters the store, they can recruit new customers.

And not only shop managers help Philips getting better sales, also the people who develop new products or techniques improve its sales. They also participate in Philips sustainable projects, which helps keeping the image of the company high (see ‘Corporate Social Responsibility’) Shareholders Shareholders have bought Philips’ stock, so they own a part of the company. Some people have bought common stock, some have bought preferred stock. People with common stock obtained rights to vote in Philips annual General Meeting of Shareholders (preferred stock holders cannot vote, they have priority in the payment of dividends) .

Before the annual meeting, shareholders can do a proposal for putting an item on the agenda, they have to send these requests to Philips and they will accept or deny this proposal. In this meeting shareholders can ask questions and are sometimes entitled to vote. The interest common stock holders have in Philips is that they can request and vote on certain matters. The interest shareholders with preferred stock have in Philips, is the fact that they get paid first in the event of the company’s liquidation or bankruptcy, and also the assets will be divided amongst them.

These shareholders also contribute something. Because, without their money, Philips isn’t able to invest in certain projects, or to develop new products and techniques. Suppliers Suppliers who work with Philips contribute to the quick transport and flexible supply of product materials. They make it possible for Philips to run everything as efficient as they want it to be. But these suppliers not only contribute something, they also have an interest in this whole process of working together, as Philips puts it: “We are generating value through shared goals and leveraging our mutual strengths and competencies. And: “Our partners can be meaningfully involved in our innovation and product creation process. ” These strategic alliances are essential for Philips, because, through its suppliers it was able to offer some new products to its customers, like: Senseo®, PerfectDraft and ActiveCrystals (Swarovski). Competitors Competitors also have an interest in Philips: they gain information from their ads, their new products and their online data. All this information is what they can use to improve their own companies. But this also works the other way around; Philips can go to its competitors websites and investigate their data as well.

They can gain insights from this information: what does the competitor do different? Which products are they going to launch? What do their customers like about them? Etc. But competitors can also have a negative influence on Philips sales if it sells similar. This also becomes a problem when the competitor has cheaper prices, or products of better quality. EXTERNAL STAKEHOLDERS Government A government of a country can restrict companies in doing what they would like to do. This can have a negative influence on its sales or even on its image.

This happened to Philips in 2005, when it Philips America made a deal with Cuba to provide medical equipment (from Philips in the Netherlands) to the country, but they did not have the permission of the American government for this deal. So by making the deal, Philips broke the law and Philips Electronics North America Corporation was accused and had to pay a fine to the American government. After paying this fine Philips provided the needed equipment to Cuba, and that it would continue to do business with that country, but this time with the needed licenses.

But apart from negative influence, a government can also contribute something positive to a company. Sometimes a government decides to protect certain sectors or products by giving subsidiaries for example. And without a government and law, it probably wasn’t even possible to set up a business. But governments themselves also benefit from companies in return, especially from big multinationals like Philips, because they have to pay a lot of taxes, which it can use for governmental plans and projects. Unions The European Union is also a stakeholder.

This was clearly visualized in 2009, when Philips -together with LG and other electronic manufacturers- received a ‘statement of objections’ of the European Commission, because it was suspected of manipulating prices of LCD displays. But Philips was (probably) wrongly accused since it formed a joint venture with LG in 1999, but “completed the sale of its share in the company and states that it received its statement of objections as a former shareholder of LG Display,” according to the news articles. This shows that a Union, together with a overnment can have an (negative) influence on a company. But again, the European Union also provided major possibilities for Philips, because it facilitates trade with European countries. Professional groups Also activist groups can have a direct influence on a company. This was shown when Greenpeace activists dumped electronical waste; e-waste, (equipment that doesn’t work anymore) in front of the Philips office in the Netherlands. Their goal was to pursue Philips to make a policy on taking back e-waste. But Philips said it was the responsibility of its customers to take care of their waste.

In this case, the activists did not make a difference; Philips did not make a policy on e-waste. But it has happened before that a company adjusted their policies for example, because of activist movements. This shows that activists can sometimes reach these companies and can have a direct on them. Corporate Social Responsibility Philips takes part in several social projects: Health Opportunities for People Everywhere (HOPE) “We are partnering with project HOPE to strengthen community healthcare centers in four major Chinese cities.

The aim is to make them better equipped to deal with patients suffering from strokes, heart- and respiratory diseases. The project seeks to do that by improving the transfer of clinical expertise from the bigger municipal hospitals to healthcare centers. Better healthcare centers will attract more patients, relieving the hospitals of some of their healthcare burden. Philips is funding this project and providing technical support. ” This programme will take 3 years and will help enhancing the chronic disease management in Shanghai, Beijing, Guangzhou and Wuhan. Philips is committed to developing solutions that deliver value throughout the total care cycle, and this program would be our exploration in the areas of monitoring and follow up to help enhance the recovery of chronic disease patients. ” said Patrick Kung, Executive Vice President and CEO of Philips in China (second man on the picture). [email protected] “With this ambitious project we aim to reach primary school children around the world. Philips volunteers will visit schools and work with teachers to show pupils simple ways to improve their health and well-being.

Topics include hygiene, air, water and light. Our volunteers will also upgrade the lighting in the class rooms by installing energy-efficient lighting. The [email protected] project has had a successful launch in eight countries and this year will see its global roll-out. ” These 8 countries are: India, Indonesia, Japan, Malaysia, Philippines, Russia, Singapore and Thailand. Altogether, Philips employees teach at 37 schools, which means that they teach 5000 young students. They tell these children how to change their lifestyle into a healthy one with help of lightning, air, exercise, sleep, etc.

They also inform them about the nature and AIDS. On their website they state that they also “support programs to ?ght global killers like cardiovascular diseases and cancer, and more. ” And “By linking social investment initiatives with the scope of our business, we can make the most of our core competencies to make a difference in people’s lives,” so they say. Philips has also participated in a lot of projects in Brazil. They have done a similar projects to SimplyHealthy, called the ‘Donate Life’ project (2001). But this project was focusing on informing youngsters about AIDS and teen pregnancy only.

Another project they did in Brazil was ‘Learning with Nature’ in 2002, the name says it all. Another environmental project took place in Malaysia, called ‘Footprint in Nature’. The reason that Philips organizes these projects is ”to plant the seed for a mindset that will preserve the environment for future generations. ” Philips was also sponsoring (it is the leady company) an American project of the American’s Heart Association, called ‘Start! Heart Walk. ’ And of course, some employees (1,900! ) also participated in this walk. They have raised €223000 for research in cardiovascular diseases.

Sources:

http://www.cubaheadlines.com/2009/09/09/18369/cuba_philips_denies_castros_accusations.html#ixzz1DxqcWWrm www.philips.com
http://www.cubaheadlines.com/2009/09/09/18369/cuba_philips_denies_castros_accusations.html#ixzz1DxqcWWrm

http://www.hexus.net/content/item.php?item=19241
http://www.inavateonthenet.net/article.aspx?ArticleID=26373
http://www.whathifi.com/news/Philips-denies-allegations-of-LCD-price-fixing/ http://www.greenpeace.org/international/en/news/features/sense-and-simplicity-100608/

To add later on:
HOW DOES THE COMPANY COMMUNICATE WITH ITS EXTERNAL STAKEHOLDERS?

check http://www.philips.com/about/investor/businessprinciples/policies/index.page