3 Market characteristics
3.4 Competitors‘ profiles
3.4.2 Competitors’ CSR activities
regulatory requirements, supplier network, dealership network, safety, care for customers, design, high production numbers, complexity of the vehicle, high quality, flexibility for changing market demand, competitive prices, profitability.
BMW Group is the only company in the automotive industry that has been listed continuously on the Dow Jones Sustainability index.
The company engages with capital market, suppliers, networks and associations, political decision-makers, research, mass media, business partners, local stakeholders, employees and customers. It is done via different channels and tools. The main activities to achieve that engagement include dialogue with investors and analysts, technology conferences and workshops, presentations, joint events, participation of company experts in committees, availability to answer questions and provide information, visiting universities and colleges, press releases, trade fairs, discussions with local residents, social media.44
3.4.2 Competitors’ CSR activities
The two chosen companies are not only Tesla’s competitors in terms of market share but they also have well-established CSR activities and can they can be looked up to. Another important thing is that Tesla has its factories in China in Germany, as well. So, it is important to
understand how companies in automotive industry work at these markets.
3.4.2.1 BYD Company Limited CSR activities
The firm refuses to accept, produce and issue any defective product and investigates every accident.
Fair business
44 BMW GROUP. [online]. Sustainable Value Report 2019. rep. 2020. [Accessed 1 December 2020]. Available from:
https://www.bmwgroup.com/content/dam/grpw/websites/bmwgroup_com/responsibility/downloads/en/2020/202 0-BMW-Group-SVR-2019-Englisch.pdf.
27
CSR is implemented into the entire operation and daily management of BYD. The company is trying to meet expectations of corporate stakeholders, therefore improving management system is an ongoing process. The company’s Code of Conduct explicitly demands compliance to competition, anti-trust and fair-trading laws in countries of operation, and prohibits activities of unfair competition.
Anti-corruption communications
BYD regularly announces anti-corruption policies, news, case notices, and relevant laws and regulations through various channels, such as its website, emails and public notices.
Anticorruption campaigns are held with the help of signing letters of commitment, trainings, quizzes contests, and so-called anti-corruption month. Employees that have key positions might participate in prison tours, so that they can see potential consequences.
BYD also actively contributes to the municipal and even national anti-bribery management systems.
Social responsibility management
In order to have unified CSR organizing and management system BYD has committee responsible for formulating CSR management regulations and work plans.
Supplier management
BYD has specific requirements to their suppliers. They include prohibiting suppliers from purchasing conflict minerals, labour standard, trade safety, environmental protection, anti-corruption and bribery, occupational and health safety.
BYD has established CSR regulations for suppliers. The incoming quality control process examines compliance for materials with such requirements. Materials of high risk are inspected for key humanity and environment metrics. Suppliers undergo CSR review
annually. Depending on the nature of materials, suppliers might also be inspected for conflict minerals.
New suppliers will be investigated by BYD with the help of BYD Supplier Review Sheet.
The object of investigations is record of activities offending laws or regulations and necessary credentials.
Communicating CSR
28
The company’s CSR committee hosts meetings, training sessions, and interviews to ease the execution of corporate social responsibility programs. BYD has CSR community groups inside the company that share relevant information, enhance and push forward social responsibilities as a company. Since 2010 BYD has been releasing CSR reports for 9 consecutive years. By providing these reports, company fully discloses its efforts in
economic, environmental, social responsibilities and in improving the industries it operates in.
BYD also actively participates in industry CSR events.
BYD actively engages with stakeholders in order to hear their demands and alter corporate management accordingly. The company organizes a lot of activities with stakeholder participation, such as meetings, events, questionnaire surveys, academic workshops, and different work groups.
Employees first
BYD’s human resources department works in accordance with the principle of “employees first”. The company is trying to create an environment that is fair, just, and open, for their employees to work in an develop career. Among BYD’s employees there are also interns and disabled recruited though the year to work in BYD’s various units.
BYD has developed the BYD Human Resource Management policy in accordance with the guidelines of “equal opportunity, based on capability”. In the recruitment process any
discrimination based on age, gender, geographic location, ethnic group, tradition, social caste, religion, physical disability, and political tendency is strictly prohibited. Child and forced labor are also prohibited. BYD actively advocates for local recruitment to increase employment and stimulate and economic growth.
There is a special program at BYD, called “Rising Dragon Program”. It is a strategic talent management system. With the help of annual performance review the company can identify the best and demote the incompetent fairly and equally. Constantly updated trainings and courses help the talents to improve their skills and capabilities.
In terms of caring for their employees BYD also has a number of activities. The company invests in housing, transportation, child education, and healthcare of their employees.
Another thing BYD is doing to be responsible to their employees is the principle of “sustained improvement” in safety and development. BYD is constantly making their health, emergency, and safety management systems better, taking into account the need of various business
29
modules for the occupational health and safety of their employees. For the fulfilment of this purpose company puts focus on carefully selecting all the raw materials, strictly controlling and optimizing all production procedures, effectiveness audits, monitoring for high-risk tasks, educating employees about safety awareness. Moreover, BYD has its own firefighters with emergency fire stations.
Green management
BYD is an active advocate for environmental protection. The company is dedicated to lowering global energy consumption with the help of green products. In the first place BYD focuses on reducing their own direct impact to the environment. BYD’s energy consumption and carbon emissions are continuously reduced because of renewable energy sources,
innovative energy management systems and eco-friendly technology and management approaches.
Contributing to the community
BYD has incentives to help the community. Their main activity is poverty alleviation. The company’s activities in this sphere are divided into the initiatives in education, industry development, consumption, healthcare.
BYD also has Volunteer Association, founded in 2016. It is based on the philosophy of
“helping every single individual with action”.45
3.4.2.2 BMW Group CSR activities
BMW Group is convinced that the lasting success of any corporation in today’s economy depend on acting responsibly and ensuring social acceptance. The global challenges of today’s world, such as climate change and urbanization are the factors that inspire and motivate the company to develop innovative products and services.
45BYD COMPANY LIMITED. BYD CSR Report. [online]. rep. 2019. [Accessed 1 December 2020]. Available from:
https://www.byd.com/sitesresources/common/tools/generic/web/viewer.html?file=%2Fsites%2FSatellite%2FBY D%20PDF%20Viewer%3Fblobcol%3Durldata%26blobheader%3Dapplication%252Fpdf%26blobkey%3Did%2 6blobtable%3DMungoBlobs%26blobwhere%3D1600574935250%26ssbinary%3D.
30
BMW Group puts focus on three key areas of action: 1. Products and services. 2. Production and value creation. 3. Employees and society.
BMW Group is doing its business in accordance with sustainable value creation and responsible corporate governance principles. The company defined clear guidelines and responsibilities to ensure compliance with these principles across all divisions of the company. These are supported by oversight and incentive systems.
UN’s climate change conferences
The company is involved in the UN’s climate change conferences. It is an important platform to interact with stakeholders. It helps to build trust, understand positions, identify trends as well as build on and consolidate partnerships. Doing so, the firm deliberately addresses critical issues and debates, as well.
Engaging in a transparent dialogue with political decision-makers
Engagement in active and open dialogue with political decision-makers, union representatives and associations, plays a constructive and transparent role in helping to shape the general political framework for business activities. Expertise provided by the company helps to promote fair competition for all involved and find sustainable solutions.
Safety first
Following its principle of “safety first”, the BMW Group offers its clients and other road users the highest safety standards. The active and passive safety systems in the vehicles ensure better safety on the road. Moreover, the firm avoids using of substances dangerous for human health in the production processes. Also, customers are informed about all the safety aspects of the products, being able to recognise and overcome dangerous situations by taking driver safety training.
Emissions of CO2 and pollutants
BMW Group strives for lowering emissions with the help of efficiency technologies and offering more electric models. The company has set a goal to achieve sustainability over the entire life cycle, expand their vehicle portfolio, facilitate rapid charging and improve access to charging stations.
Production and value creation
31
The company is conserving resources by optimizing processes and new technologies. In order to minimize waste, the firm is recycling. Life Cycle Engineering makes, the environmentally friendly use of raw materials as early as the vehicle development phase, possible.
Renewable energy
The company uses renewable energy at its plants and promotes renewable energy in the supply chain.
Employees and Society
Employee satisfaction in the year 2019 was 82%, the share of female employees in total workforce in 19.8 %, share of female employees in management positions in 17.5%.
The BMW Group promotes personal responsibility and an accordingly designed work environment in order to preserve the health and the performance of its employees in the long term.
As part of company’s Health Initiative, they have developed an extensive prevention and rehabilitation program, that covers the areas of nutrition, exercise, relaxation and addiction prevention. Moreover, BMW Group runs international campaigns, which increase health awareness of employees. Also, the company has a program that help their employees remain healthy and able to work as they age.
The BMW Group is constantly working towards long-term employee development, seeking out the right employees, making the most of their talents, developing potential and ensuring employability. The main ways to make it happen are: offering attractive overall remuneration, providing work-life balance, offering a variety of training and other education courses, putting focus on improving expertise and leadership skills.
The company is promoting diversity and equal opportunity in the company. Because of that, the company’s competitiveness is increasing and its innovative strength is enhancing. The BMW Group Code on Human Rights and Working Conditions declares that a fundamental principle of its corporate policy is equal treatment of all employees.
Corporate citizenship
The BMW Group is a leading in intercultural understanding. The company strengthens intercultural understanding and facilitates social inclusion, involves and rewards its
32
employees. The BMW Foundation Herbert Quandt is an independent corporate foundation. Its activities contribute to the company’s corporate citizenship and its mission.46
46 BMW GROUP. [online].Sustainable Value Report 2019. rep. 2020. [Accessed 1 December 2020]. Available from:
https://www.bmwgroup.com/content/dam/grpw/websites/bmwgroup_com/responsibility/downloads/en/2020/202 0-BMW-Group-SVR-2019-Englisch.pdf.
33