Ford Motor Company’s corporate social responsibility (CSR) programs and environmental, social, and corporate governance (ESG) strategy respond to the demands and interests of the firm’s stakeholders. The car manufacturer impacts these stakeholder groups through its business activities. These stakeholders are significant because they affect the company through their purchases and sociopolitical pressure. Stakeholder behaviors reflect trends that impact the market, such as the ones outlined in the PESTLE/PESTEL analysis of Ford. As one of the biggest U.S.-based automobile manufacturers, the company addresses the needs of its stakeholders to maintain its industry position. Thus, improving corporate social responsibility efforts helps sustain Ford’s long-term development toward its aim of becoming the global market leader.
Ford’s comprehensive corporate social responsibility (CSR) programs address stakeholders’ interests and optimize the firm’s relations with target customers around the world. These programs establish the automaker’s sustainability and corporate citizenship, which enhance business competitiveness. Corporate citizenship makes the business more desirable and, thus, competitive, and strengthens competencies, such as the ones shown in the SWOT analysis of Ford Motor Company. In this regard, addressing the aspect of business ethics and related CSR/ESG issues helps improve the automotive company’s performance in the international market.
Ford’s Stakeholder Groups & CSR/ESG Initiatives
Ford’s stakeholders are comprehensively addressed through various corporate social responsibility initiatives and programs. The following are Ford’s stakeholders, with customers having the highest priority:
- Customers (Ford’s top-priority stakeholders)
- Employees
- Investors
- Communities (least-priority stakeholders)
Customers. Ford’s top-priority stakeholders are its customers. The interests of this stakeholder group are high-quality products and services, especially after-sales services. Customers are significant stakeholders because they directly determine the company’s revenues. Ford’s corporate social responsibility efforts for this stakeholder group are as follows:
- Product innovation for quality, fuel economy, ecological impact, and safety
- Ford Smart Mobility
- Ford Driving Skills for Life program
Ford continues to innovate its products for quality, fuel economy, environment-friendliness, and safety to maximize satisfaction among customers as stakeholders. Majority of the company’s vehicles have five-star ratings from the United States New Car Assessment Program (NCAP). Also, the Ford Smart Mobility program aims to increase mobility and provide autonomous/driverless vehicles. In addition, the Ford Driving Skills for Life free driver education program helps novice drivers develop skills for safe and efficient driving. Thus, the company’s corporate social responsibility programs extend beyond offering vehicles and improve the driving skills of customers as the top stakeholders. These corporate citizenship efforts that benefit customers are designed to satisfy Ford’s corporate mission and corporate vision, which focus on the transportation and mobility needs of customers.
Employees. Ford considers its employees as second-level priority stakeholders. This stakeholder group is interested in career development, high wages, and equal treatment and opportunities. Employees are significant stakeholders because they influence the production and service capacity of the business. For instance, even a small decline in this stakeholder group leads to a proportionate decline in the company’s productivity and performance. To address the interests of employees as stakeholders, Ford has the following corporate social responsibility initiatives:
- Sustainable Workforce
- Product Online Training
- Global Learning and Development
- Global leadership development programs
Ford Motor Company has workplace safety policies to protect this stakeholder group and ensure regulatory compliance. The firm’s Sustainable Workforce initiative aims to optimize employees’ health, efficiency, and productivity. For instance, Ford’s global safety standards prevent workplace injuries. The company also offers online product training to keep this stakeholder group always up-to-date and capable of doing their jobs. In addition, the firm’s corporate social responsibility efforts include the Global Learning and Development program, which offers continuing education through classroom-based and online courses, as well as mentoring and shadowing to maximize performance and satisfaction in the stakeholder group. Moreover, Ford has global leadership and development programs, like (a) the Global Leadership Summit for executives and general managers, (b) the Global Executive Leadership Program for directors and senior managers, (c) the Experienced Leader Program for middle managers, and (d) the Salaried Supervisor Institute/Program (SSI) for new or experienced leaders. These programs reflect Ford’s corporate social responsibility and the company’s dedication and support for the interests of the stakeholder group of employees. Ford’s organizational structure (corporate structure) is designed to facilitate these ESG/CSR initiatives for workers. Also, corporate citizenship endeavors are integrated into the social aspect of the automotive business organization. For example, Ford’s organizational culture (work culture) helps enhance employees’ job satisfaction and drive for career development.
Investors. Ford’s investors are interested in maximum profits and business stability. These stakeholders are significant because they affect the firm’s capital. To address the interests of this stakeholder group, the automaker implemented the One Ford plan in 2008 under former CEO Alan Mulally’s leadership to achieve consistency and synergy in its global organization. The One Ford plan reduces costs and maximizes the company’s profits worldwide. This effort is part of the automotive company’s corporate social responsibility strategy to improve its performance. At present, Ford’s generic competitive strategy and intensive growth strategies satisfy shareholders’ interests for business growth and competitiveness. These strategies help make the company’s corporate citizenship comprehensive by including business objectives for outperforming competitors, like Toyota, Tesla, BMW, and General Motors. These firms impose the competitive challenges identified in the Five Forces analysis of Ford and influence decisions for the company’s CSR/ESG programs for sustainability and stakeholder management.
Communities. Ford has corporate social responsibility programs for communities as stakeholders. The interests of this stakeholder group include support for community development, as well as environmental conservation. Communities are significant stakeholders because they can influence the perceptions of Ford’s customers. These interests are addressed through the following corporate social responsibility programs:
- Supplier sustainability training
- Ford Motor Company Fund and Community Services
- Ford Volunteer Corps
- Ford Driving Skills for Life program
Ford provides sustainability training to its suppliers to improve their sustainability performance, which is linked to environmental impact. Also, the Ford Motor Company Fund and Community Services is the company’s nonprofit organization for a wide variety of philanthropic efforts for this stakeholder group. For example, the firm’s corporate social responsibility efforts provide investments for community irrigation, as well as education programs in rural areas. The Ford Volunteer Corps, composed of the company’s employees, supports community development. Moreover, the Ford Driving Skills for Life program ensures that driving does not create issues with community safety. Thus, the company’s corporate social responsibility activities for these stakeholders are diverse. These corporate citizenship programs are communicated as part of public relations in Ford’s marketing mix (4Ps) to improve the public image of the company and its brands.
Ford’s Corporate Citizenship & CSR/ESG Performance in Addressing Stakeholders’ Interests
Ford has excellent corporate social responsibility performance. The company has numerous programs and strategies to address the interests of its stakeholders. The improvement in the company’s performance following the 2008 reform under the One Ford plan is of note. However, for long-term sustainable and green operations, the company must emphasize product development and cost minimization in its corporate social responsibility efforts. For example, more affordable, more energy-efficient, hybrid or electric vehicles can increase customer satisfaction and add to the company’s business performance, sustainability, and corporate citizenship.
References
- Fatima, T., & Elbanna, S. (2023). Corporate social responsibility (CSR) implementation: A review and a research agenda towards an integrative framework. Journal of Business Ethics, 183(1), 105-121.
- Ford Motor Company – Community.
- Ford Motor Company – Environmental, Social, and Governance.
- Ford Motor Company – Form 10-K.
- Ford Motor Company – Sustainability.
- Park, J. G., Park, K., Noh, H., & Kim, Y. G. (2023). Characterization of CSR, ESG, and corporate citizenship through a text mining-based review of literature. Sustainability, 15(5), 3892.
- U.S. Department of Commerce – International Trade Administration – Automotive Industry.