Toyota Motor Corporation (TMC) was founded in 1933. It was part of Toyoda Automatic Loom Works which was committed to the production of automobiles. The Toyoda Automatic Loom Works was controlled by Kiichiro Toyoda who is the son of Toyoda’s founder. Kiichiro Toyoda became the founder of Toyota. The A1 and the G1 vehicles were Toyota’s first vehicles that were produced in 1935. In August 28th 1937, Toyota Motor Corporation became self-governing company. Toyota employs about 320,590(31th March 2010) people worldwide. Toyota is the world’s largest vehicle producer by sales and production.
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Toyota Motor Corporation has different group of companies. They have the Toyota, Lexus, Scion and Hino Motors. Toyota also has companies that are not part of the automotive industry. They are also into Financial Services, Biotechnology, Aerospace, Robotics as well as higher education. The Toyota Motor Corporation headquarters is located in Toyota City, Tokyo, Japan. The current president of Toyota is Akio Toyoda. Toyota has a large number of competitors. They have competitors like Hyundai, ford and General Motors. Toyota’s Competitor’s are trying to take advantage of the resent recall trouble’s Toyota has been facing. In this essay, Toyota’s ethical and Corporate Social Responsibility will be discussed. The company’s activities will also be talked about as well as where it stands when being compared to its competitors.
Toyota’s Ethical and CSR obligations
Corporate social responsibility (CSR) is how businesses behaves and put their values and behavior according to the expectations and needs of stakeholders. Their stakeholders can be their interest groups, investors, communities, employees, suppliers, customers, and society as a whole. CSR is a company’s commitment to be responsible to its stakeholders. Moreover Ethics are a personal view of what is right to someone, they have their own principles of right or wrong.
Toyota takes contribution to improve the living society and the environment very seriously. Toyota considers their stakeholders of significant importance. Toyota wants to create a respectable image all over the world, in addition to effectively working add more value to stakeholders.
Toyota improved their CRS POLICY in August 2008, this improved policy had taken relationship with stakeholders more important than before. Toyota is also looking forward to seeing its partners adapting to such policy. Toyota has different major stakeholders and they take their relationships with them with big importance. Toyota’s relationship with its customers, Toyota puts many of its resources to ensure their customers are satisfied and that they continue to trust in the company. Toyota is constantly working to improve on that. Toyota has a “Customer First” policy. They always remember that and ensure their customers get quality products and services. The aim of Toyota′s “customer first” policy is to offer products and services with outstanding performance. They aim for performance environmentally and also in safety as well as quality. To have an exceptionally driving experience in which the customer feels it has the value of the money he spent buying the product. Toyota tries to make their products to its customers very affordable and is always determined to make sure each customer is satisfied. Toyota also guarantees customer satisfaction through good customer relations. They Assess and ask of the opinions of their customers to see what the customers expect from the company. Toyota takes each case into consideration and they respond to each customer differently and personally depending on the customer. They also provide customer consultation sessions, they feel this helps their customers to have more trust and confidence in the company. Toyota also has a Customer Assistance Center. This is to allow them to handle as much cases as possible. The Center also offers a toll-free number. Toyota believes this center helps them to improve their products and services.
Another key stakeholder to Toyota is their employees. Toyota believes their employees are so important that they call them the backbone of the company. They want to make their employees manufacture high-class products. They believe this will help with their customer satisfaction. Toyota wants to share the principles and attitude of the company with their employees globally.
The “Toyota Way 2001” gathers and organizes the management beliefs and values that Toyota has created since the company was established. They want respect amid their labor workforce and their management, they also want employment stability. Each Toyota employee is taking actions to improve work-related skills. Joint trust and respect between labor and management is an essential code of Toyota’s employee relations.
Source: http://www.toyota-industries.com/csr/social/rinen.htmlToyota Way 2001
Toyota’s wants to do good to the society as it carries out its business activities, Toyota considers improving corporate assessment will not only be of advantage to its shareholders, but this will as well guide the way to more trust and acceptance of the company in the long term. There are three components of Toyota’s financial strategy. They are Growth, Efficiency, and Stability. Toyota believes that the balanced pursuit of those three priorities over the medium to long term will enable the achievement of steady and sustainable growth as well as increase corporate value. They want to grow by improving their technology and supply as well as getting new investments.
They want to increase efficiency by increasing profits and making sure they produce to their given capacity. Lastly, they want to have a safe financial status. Toyota tries to increase there per share earnings as a way to prioritize their Shareholders. They watch closely the time they reveal their shares and other information to the Shareholders. They believe this will help to increase the support of the Shareholders. They believe this will help give the Shareholders more precise and fair information. Toyota believes Shareholders are the backbone of business.
Toyota also takes its relationship with its business partners important. Toyota wants to have a honest and fair business activities with its partners. They will comply with the law. Toyota wants to cooperation with its business partners such as their suppliers and dealers as well as contributing to improve environment. Toyota works closely with its suppliers. Toyota wants to build strong relations with their suppliers. They believe suppliers are one of their best assets. Toyota sees this value more because as they expand they will need loyal suppliers giving them good products with affordable prices. They want their suppliers to act according to the Legal Compliance. This can be respecting their workers and taking care of the society.
Toyota is widely compared to the Honda. They are both Japanese companies and they are known for producing reliable vehicles. They also have similar prices for their vehicles. For example, the Toyota Camry and the Honda accord both cost $20,000.
Apart from making vehicles, Toyota has reportedly invested in aerospace. They put in US$67.2 million in the Mitsubishi Aircraft Corporation making it a minor shareholder in the company.
Toyota also sees higher education as a very important asset. Toyota established the Toyota Technological Institute in 1981. The institution is a university situated in Nagoya, Japan. Only students with industrial work experience were accepted before Toyota opened another branch in Chicago with the help of University of Chicago in 2003.
As Toyota knows how its industries can affect the environment by pollution, Toyota regularly checks its industries for noise or air pollutants and tries to reduce to the acceptable level for the community. For example at Toyota’s Kyowa plant where electronics are produced, they noticed the noise level had exceeded the acceptable level and therefore Toyota installed sound-insulating walls.
Sound-insulating walls installed
Source: Toyota.com
Sound-insulating walls installed
Toyota tries to recycle and use their renewable waste. They encourage the effective utilization of resources, Toyota’s aim is to improve resource efficiency and reduce waste creation. They try to increase the use of its raw materials to capacity at the manufacturing processes and at the same time promoting domestic reuse and recycling. They also use renewable materials in their cars. This can make their cars easier to be recycled.
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Toyota achieved their target of eco-efficiency of being 16% green as a company compared to their company in 2004. Toyota also deals with soil and water pollution. They build double walls as part of the measures. They also build underground storage tanks in many of their factories. Toyota also organizes tours for people such as school children to come and learn about taking care of the environment by showing them the methods the company does it.
Source: http://www.toyota-industries.com/csr/social/rinen.htmlSoil contamination prevention measures
Toyota has gone into many legal battles due its recalls in 2010. The company had issues in some of the cars. They recalled more than 8.5million vehicles worldwide. Some of which the cars accelerated unexpectedly. These recalls and legal battles will be damaging and costly to Toyota. It is reported that Toyota will lose $400million a week if it should halt production on its vehicles. Toyota has gone into many legal battles ever since the recalls. The US government fined Toyota $16.375 million as a result. For example, Toyota had to settle a high profile lawsuit over one of their cars that crashed in San Diego and the president had to apologize. The company revealed the settlement to a California Superior Court judge and the case was resolved. However that is just one of many cases Toyota is currently battling over their recalls and sudden car crashes.
Moreover, Toyota also has problems, some people say the company has grown too big to manage. The company also has some leadership issues. It was reported that the company recently lost its North American head of the business to Chrysler, another automaker. lost its much-respected head of North America to Chrysler. A former Toyota consultant Joel Kurtzman said, “From my own recent experience with the company, many of the executives I met with felt second guessed by their bosses. Numbers, not people, are in the ascendency and workers have lost respect. When the spirit of Common Purpose is on the wane in an organization, missteps are sure to follow.” This could mean that company will have issues if trust and their work quality and output will reduce.
In conclusion, this essay has discussed how Toyota fulfils its ethical and social obligations as a company. Toyota is a huge company overall, they have internal and external problems which they continue to solve. The ways the company treats each of their stakeholders and their relationships with them. The company’s activities have also been mentioned as well as things they do to help the community which are not required by law.
Source: http://www.toyota-industries.com/csr/social/rinen.html
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