The three main responsibilities and roles usually discussed are in the perspective of business, social and environment (CSR Singapore Compact 2005). Despite the fact that BMW AG is one of the best car companies in the world (Kiley 2004), there are some of their practices, which have positive and negative impacts on the environment and stakeholders, including customers and workers. Therefore, this paper analyses how well does the company has impacted upon its society and stakeholders, which can be defined as any group or individual that can affect or affecting the firm’s objective accomplishment (Freeman n. ). Role of BMW AG in Society BMW AG is a European well-known company for producing luxury cars. BMW, firstly, originated in Germany in 1916. The company exists in more than 160 countries, with 21 factories worldwide, which employ more than 100,000 people worldwide (CSR Case Study Series 2005) and according to Corporate Communication, Identity, Image, and Social Responsibility: BMW (2010) a survey was carried out and resulted that there are about 200 stakeholders from over 20 countries. It gains the reputation of the brand and its products in 1920s (Schulenburg and Triebel 2008).
The company is not just producing luxury cars, but it also producing motorcycle. According to Schulenburg and Triebel, the first motorcycle produced by BMW AG is on the year 1923. The Positive Corporate Social Performance of BMW AG In response to its Corporate Social Responsibility, BMW AG provides an environmental officer. According to Environmental Officer (2011), environmental officer functions to assist businesses to conduct sustainable environmental practices that stabilize their needs with the ecosystems in which they operate. The first environmental officer of BMW AG Company appointed in 1973.
Second, in today’s world the global issue mentioned that the environmental managers are currently working on is on how to lower the environmental impact and how to reduce the consumption of resources (Group Wide Environmental Protection n. d. ). According to Group Environmental Wide Protection (n. d. ), the competitors of BMW, which is the other car maker company, can’t match the BMW’s group efficiency of using the resources. This is because BMW AG uses a systematic way to improve their resources’ efficiency around its production worldwide every year.
Regarding the pollution problem, BMW and other car companies have the solution already, which is to make hybrid cars. BMW hybrid car is one of the examples of the eco or environmental friendly vehicle, because it does not produce any hazardous waste (BMW Hybrid Cars n. d. ). BMW Company has found a solution to reduce the pollution by producing hybrid cars. BMW has a plan to use carbon fiber material, which will result in producing an efficient type of vehicles, for their upcoming electricity vehicle (Garthwaite 2010).
There are some ways to give a positive impact to the stakeholders, such as reducing fuel consumption and CO2 emissions, refining traffic management concepts, active and passively safely and customer satisfaction (Product Responsibility 2010). This situation wills not only benefiting for customer, but it would also be a benefit to the workers or the employees in that company. Moreover, according to BMW Regional Operational Programme (n. d. ), Environmental Protection Agency has developed the framework of air management quality in the countryside areas. This then can lead to the stakeholder’s welfare around the company’s area.
For several years, BMW engineers have been allocating a selection of materials (both raw and recycled) to be used by suppliers. BMW engineers are increasing the amount of renewable material, such as flax, sisal and cotton that are designated in new cars by growing them thus do not exhaust the earth’s limited resources. Furthermore, BMW Group is working with Autogreen, a network of dismantlers, to implement an End of Life Vehicle Recycling Network, which aims to treat and dispose end of life vehicles in an environmentally sound manner (How Much Recycled Material is used in the UK by BMW 2011).
BMW also had a long history on an environmental protection, in the year of 2000, “Environmental Agencies accepted BMW as a charter member of the agency’s national environmental achievement tract” (White, Bingham and Hill 2003, 158). Recycling is one of the best ways to protect the environment. The BMW engineers’ group is responsible for the material used to make the vehicles’ components. The BMW group must ensure that those components can be recycled in the future (Product Responsibility n. d. ). Recycling would also help the company to avoid the negative ecological compact.
The other methods demonstrated by BMW to increases the environmental protection are , reducing the energy consumption, reducing water consumption, protecting wildlife and improving waste management (BMW Group 2005). The Negative Corporate Social Performance of BMW AG According to BMW Business Strategy (2010), pollution, climate change and lack of resources are problems faced by most of the companies around the world. First of all, pollution, the smoke produced by vehicles will affect to the society, environment, and it will affect the climate if there is too much smoke produced.
This will give a negative impact to the company and to the stakeholders. The company’s reputation might also be effected, if this situation keeps on happening. Nowadays, BMW and other car companies are getting a solution on reducing the pollution by producing hybrid cars. These hybrid cars are eco-friendly and environmental friendly vehicle, which can be defined as vehicles that do not produce hazardous waste (BMW Hybrid Cars n. d. ). Even though it produces less hazardous waste or pollution to the environment, according to BMW Hybrid Cars (n. d. ), the waste products that re released from the hybrid cars consider being very damaged to the environment. This is because most of the hybrid car uses electricity or natural gas as their fuel. Furthermore, these sources of energy produce hydrocarbon when uses under production (BMW Hybrid Cars n. d. ). Moreover, hybrid vehicles are a type of vehicle that is harder to build due to its complexity. So, more energy is used to produce to build this car (Hybrid Cars Negative Environmental Impact 2007). Furthermore, most hybrid cars use nickel metal hydride system, which nickel mining required.
However, these nickel metal hydrides can be recycled; even though it can be recycled it would cost a lot. (Hybrid Cars Negative Environmental Impact 2007). Road vehicle is not just giving a negative impact to the environment, so noise and visual intrusion are included in the negative impact of using cars (BMW Regional Operational Programme n. d. ). BMW Company, which has more than 21 factories and more than 100000 workers around the world (CSR Case Study Series 2005), deposed more than 8000 of their workers worldwide (Buckley 2008). On 15th August 2003, Arthur Alban purchased a vehicle that was designed and manufactured by BMW.
In 2008, Alban’s vehicles emitted a strange odor from the insulation in the trunk of his vehicle. Alban claimed BMW to replace the insulation as the vehicle’s warranty covered defects in materials or workmanship for a period of 48 months or 50,000 miles, whichever occurred first. However, BMW refused to compensate the defect parts by arguing that the warranty period had expired. In the end, the district court found out that Alban did not seek repairs within the warranty period. Therefore, BMW did not manipulate its rights by refusing repairs. Concluding Remarks
This paper examines the positive performances of BMW AG in the society such as developing vehicles’ components that can be recycled in the future. Moreover, the company develops materials that can be recycled to be used in the manufacturing the vehicles. Nevertheless, BMW AG performances have affected environment negatively by causing a lot of pollution, which the main pollutants from vehicles are CO2 gas. BMW Group has attempted their best to listen and understand the stakeholders. This kind of situation will help the company identify the risks and the potential to avoid errors (Sustainability Management 2007).
Even though BMW group are trying to avoid errors, they cannot avoid the major problems faced by all the car manufacturers company, which is pollution. Pollution appears in two areas, which are noise and air pollution. Air pollution might risk the health of the society, including eye irritation, breathing problems and skin irritation. Therefore, it can be concluded that, BMW Company can produce hybrid vehicles to reduce the pollution, so that it will maintain the reputation of the company, and it will maintain the stakeholder’s trust to the company.
Even though there are solutions regarding the problem on pollution, which is using the hybrid vehicles to reduce pollution, there are some negative effects resulted by using those hybrid vehicles. The negative effect using hybrid vehicles are, the waste products that are released from those hybrid vehicles, which are from natural gas or electricity, might harm the environment further.