The Walt Disney Company Corporate Social Responsibility Plan

The Walt Disney Company Corporate Social Responsibility Plan

Craig Corbett

OL-690-X2138 Responsible Corporate Leadership

Executive Summary

        This report provides an analysis and evaluation of the current and projected state of The Walt Disney Company’s Corporate Social Responsibility.   Areas taken into account are regarding the company’s Economic Status, Political Status, Status within Civil Society, and Environmental Impacts.  The report finds the prospects of the company in its current position to be positive.  However, there are areas of weakness that require further investigation and action by management.  Recommendations to the company’s Media Campaign include:

• Improving the International Workplace through television campaigns
• Becoming more forthcoming with political relationships through Facebook, Twitter and radio advertisements
• A TV campaign and televised awards show to promote the Civil Sphere
• A dedicated website to educate the public on the company’s environmental projects

        Overall the company is continuing on a positive projected path.  The recommendations of the report are that The Walt Disney Company continues the current actions in the Civil and Environmental Sphere.  Additional promotion of these spheres is expected to increase participation by both internal and external stakeholders.

Introduction

        For the past three years, The Walt Disney Company is one of two companies that have consecutively ranked in the top three Global Corporate Responsibility rankings per a tracker conducted by the Reputation Institute.  The goal of The Walt Disney Company is to be one of the leading producers and providers of entertainment and information in the world.  The company strives to develop the most creative, innovative and profitable entertainment experiences through content, services and consumer products (Walt Disney Company, 2016a).  The company’s vision is based on three major aspects, generating the best content possible, fostering innovation and utilizing the latest in technology and expanding into new markets around the world (Disney, 2016a).  Disney works to conduct itself ethically through the Three Spheres of Human Civilization.  Many of the functional aspects of the Economic Sphere at Disney are engrained in employee relations.  

The productive workforce works with the company through the formation of trust and loyalty stemming from the company taking the goals of the employees into consideration which creates a sense of economic and social mutuality between the people and the company.  The company does not publicly disclose much in regards to the political sphere; however, there are examples of Disney making political campaign donations to causes that may increase its earning potential.  The Civil Sphere is most affected when the company opens new parks.  It has been noted that when the company opens new parks, thousands of jobs are created from construction to full time employment for new workers when each park is up and running.  Spencer and Nsiah write that in addition to this, the community is also positively affected due to the business that the parks bring to local businesses from tourists and non-resident workers spending money (Spencer & Nsiah, 2013).  

Economic Sphere

        The Reputation Institute has ranked Disney as one of the top ten companies in the world in regards to the workplace in 2015 (The Reputation Institute, 2016).    Disneyworld employees have access to health benefit packages that include various medical, dental, and vision coverage.  T.C. Zhang, J. Kandampuly and H.Y. Choi (2014) report that addition to this, The Walt Disney Company offers an on-site gym and free health screenings.  The company also takes part in a preventive care initiative in which it offers resources to employees and their dependents through a wellness center called the Center for Well Living.  The center provides labs and facilities for basic radiology, pharmacy and urgent care in addition to offering behavioral health and wellness tools (Zhang, Kandampully & Choi, 2014).  The initiative was created in order to promote the long term health and wellness of the employees.  While the position domestically is positive, there remains room for improvement overseas.  

Investor Relations

Back in 2003, a wide range of stakeholders ranging from families, consumers and employees, such as Roy Disney, began a campaign to have the leadership within the Board of Directors changed. Over 35,000 people had signed up on a website entitled savedisney.com, calling for the dismissal of members of the board. Initially, the board rejected this demand. However, in 2004, at the urging of the Institutional Shareholder Services, the board members ultimately voted to reduce the authority that Michael Eisner had and split his position into two, ultimately leading to Eisner’s resignation shortly thereafter (Meisenbach & Feldner, 2009).  Eisner was replaced by Bob Iger who has led the company to record financial results double digit earnings per share growth for the ten straight fiscal quarters (Disney 2016b).  This has led to Iger’s contract as Chairman and Chief Executive Officer through 2018, along with the board’s proclamation that he has transformed the company’s culture for the better by leading change that creates extraordinary shareholder values.

Suppliers

In 2014, Disney responded to requests from the China Labor Watch and published its facility list on its website for the first time in the company’s history.  Disney stated that by releasing this list and by monitoring child labor reports, it is, “commit(ed) to transparency in its supply chain operations and its commitment to fostering safe, inclusive and respectful workplaces wherever Disney-branded products are manufactured” (Disney, 2016).  Even though the facilities have been made public, the company could improve its enforcement of ethical treatment through third party vendors.  

Areas of Improvement

In 2013, J.Chan wrote about a series of allegations that took place in the 1990s.  Reports of labor abuse were filed on behalf of Disney employees both nationally and abroad.  A labor activist group in China, Students and Scholars against Corporate Misbehavior (SACOM), was formed (J.Chan, 2013).  SACOM released a report on working conditions facing Disney employees, entitled ‘Disney’s Children’s Books Made with the Blood, Sweat and Tears of Young Workers in China’.  The story was picked up by such news outlets as the New York Times and CNN, who reported, among other accusations, that there were instances of underage child laborers, poor work conditions, and significantly low wages to Disney employees.  Although the company denied the severity of the report, according to the China Labor Watch, many believed that Disney’s audit system was not working (China Labor Watch, 2010).  In response, Disney worked with an independent company in 2006 to audit its factories in order to ensure that working conditions were up to par.  However, as long as Disney continues to outsource the manufacturing of their toys and apparel to China, ranked in 2015 as one of the worst countries for workers, based upon the International Trade Union Confederation Global Index (2015), it will continue to face a challenge to ensure that working conditions remain acceptable.  According to the Labor Watch the company created a program in 2002, entitled “Project Kaleidoscope” to address international labor issues.  Yet, after its final report was released in 2009, many of the same issues, overtime, wages, underage labor, and living conditions, remained.  It is recommended that Disney continue to take steps to improve its Global Labor conditions before it tarnishes the reputation that it has created.  Disney committed itself to transparency in 2014 when it published its facility list in its website.  In 2014 it was reported that Disney halted its relationship with vendors in Bangladesh amid reports of employee abuse but admits that it still faces concerns with workshops in China and it is recommended that it must continue to monitor allegations of abuse that stem from there and drawing attention to it to create a unified front with the consumers.