Body Shop Case Study
The Body Shop #1
1. In this case, how does The Body Shop address the four components of social responsibility? In the Body Shop, what tensions among these components were at work?
Economic- The Body Shop used inexpensive ingredients in the products offered. There was also a recycle program where the customers could return used bottles and receive a discount which would save the company money by not having to buy more supplies. The Body Shop also created a company with strong values that customers stood by which was the reason their success.
Legal- the Body Shop avoided animal testing and used all natural ingredients to avoid any lawsuits. They knew the products were safe since people have been using them for years.
Ethical- Anita Roddick, owner of The Body Shop, reflected her personal ethical beliefs into her work. She was against animal testing and made a great effort to make sure her company and the suppliers also felt the same way. She also wanted her employees to fit a certain image and hired accordingly, some could argue this can cause some ethical problems.
Philanthropic- The mission statement of The Body Shop is “To dedicate our business to the pursuit of social and environmental change” and the entire company was based around this. They contributed a part of their earnings to environmental change. Roddick shared her information about certain products with other companies in hopes of reducing animal testing. She preached to her customers about animal rights, environmental causes and spread her message.
Some tensions arise from the components of corporate responsibility. Anita’s ethical and philanthropic values were reflected in her hiring procedures. This can cause some legal actions taken by applicants who thought they were given and unfair advantage. Some other tensions could arise between the economic and philanthropic components. As a result of Anita’s strong ethical beliefs and mission statement there could be some issues arising that prevent the company to make a substantial profit.

2. Analyze the Body Shop’s power using both levels spheres of power discussed in Chapter 1. How do you assess the company’s mission statement? spheres/levels Macro level Intermediate Level Micolevel Individual Level
Economic Make a profit Set a market price for goods Increase Net Income Promote company (word of mouth)
Social/cultural Commit to change Change attitudes of public Commit to values Change personal behaviors to reflect company
Individual Influence customers Influence personal change Influence employees to change Come out with new ways to benefit organization
Technological Come out with new ideas Invent new product that require no animal testing Come out with new ideas Follow alternatives to animal testing
Environmental Be environmental conscious and protect it Protect the environment and pursued others to Give back to agencies protecting environment Protect environment and buy products that support belief
Political Influence change in legislation Come out with new legislations about animal testing Follow own rules set for product creation Abide by laws regarding animal rights.

The Mission statement clearly takes a stand with business and addresses there environmental and cultural concerns. It concentrates on the beliefs and activist thoughts not profit.
3. Does the Body Shop employ any questionable practices with respect to hiring? The Body Shop asks potential employees questions about “personal heroes” and individual beliefs. Is it ethical to ask such questions of applicants? Are such questions fair to applicants?
Hiring based on individual beliefs could create potential lawsuits from applicants who feel they were given unfair and unbiased treatment. I understand her need to represent her core values and reflect that into her employees but I am unsure how personal heroes could represent that. I also think some problems could arise when asking about beliefs on certain social issues because it could reveal elements about the person’s religion and other personal areas which are illegal questions to be asked. I also believe that these questions are unethical because it can give Anita unfair reasons to not hire an individual. Just because she may not like their personal hero or beliefs, that shouldn’t prevent them from the job.
4. What is your assessment of Anita Roddick’s philosophy regarding the “purpose of a business”?
I believe if her purpose is to use her business to support her beliefs and help promote her environmental issues then she did stay true to that based on the facts presented in the case. She has a responsibility to her customers and they know and also follow her beliefs. I think it is great she was able to use her success to help other activists groups and promote her principles.
5. What are Anita Roddick’s strengths and weaknesses as a leader? Should she stay on in a managing role or step aside and allow a more experienced person to run the marketing operations?
Anita’s strengths as a leader first started when she was able to build a company from limited finances, she was also able to turn her small business into a profitable organization and give back the community. She stayed true to her beliefs and they were reflected into her business. She did however have some weaknesses that stood out. Anita had to face tough competition and the Body Shops products couldn’t compete. She was also had problems when marketing to US consumers. I also think that her hiring procedures were questionable and her stance on no advertising would make it difficult to get her message out. I think that Anita should step aside and let someone more experienced help with marketing the business if she wants to get ahead. She could take on a consulting role and lend her information about the organizations she wants the company to support. Without a sufficient marketing plan it may be difficult for her company to stay successful just by word of mouth, especially if she wants it to grow and not just be a small business owner.
6. Anita Roddick claims that her firm does not advertise, yet it receives free media exposure and publicity through the social causes it champions and her personal appearances. Is this an appropriate approach for a business to follow?
I think this is completely appropriate. Anita’s business mission and role in the company is to spread her message and inform the public and she followed her mission by talking about her causes and getting the word out. I also think as a business owner she owes it to her stakeholders to make a profit and by letting others know what her philosophies where, it was also able to benefit her business as well.
7. What is your opinion of the Body Shop/ American Express advertising campaign? Was it a sound business decision on Roddick’s part? What does the American Express campaign imply about The Body Shop and its customers? Is it different from the image of the non-profit organizations that The Body Shop endorses? Did Roddick commit an ethics transgression by advertising through the American express ad that contravened her earlier statements and policy, or was this different? How should she explain herself?
The American express campaign was a creative way to advertise her company indirectly but still stay true to her original beliefs. On Roddick’s part it was defiantly a good business decision by not directly using her own resources to promote her store or having to go back on her word about advertising. By the descriptions in the case the American Express campaign showed the real side of The Body Shops customers. It expressed the stores and the customer’s beliefs and showcased what they stand for. I think the commercial stayed true to the organizations it supports. Many nonprofit organizations showcase what their ideals in order to get more supporters and Anita followed that. I don’t think she committed an ethics transgression because the ad did promote the company however she did it in a tasteful way. She didn’t advertise a particular product like most company’s do but shared her beliefs and used her power to spread the message like she wanted to do all along, it just so happened to benefit The Body Shop as well. She continued to follow her mission and role in the company and stayed true to her core beliefs.
8. Can a company such as The Body Shop succeed trying to balance profitability with an obsession with social causes?
The Body Shop can succeed because there are plenty of people with the same values. They just have to come up with a way to reach all of them and promote their ideas. Today, especially there is a stronger stance on environmental issues and affects and this company can use this niche to distinguish itself from others, as long and they stay aligned to the mission statement.
The Body Shop #2
1. During the time period of the case, how has The Body Shop continued to address the four components of corporate and social responsibility?
Economic- Sales and net income continued to grow and The Body Shop was able to continue opening more stores. A bad economic impact was after the bad press the company received, the stock plummeted 50% in 1994. The Roddick’s took a loss of millions of dollars despite having to sell their stock. And the increased competition from other companies affected The Body Shops standing.
Legal- the Body Shop and Bath and Body works stores created confusion among the public because of the close resemblance. The Body shop protected it employees with a law suit against the company and the company settled out of court. The Body Shop also took legal action against a TV station after false allegations of how the company performed. These examples showed the company’s loyalty towards their product and they were willing to protect their reputation in any way necessary.
Ethical- While producing a TV series there were accusations of distorting tribal rituals depicted in the film, they ignored this and proceeded anyways. We are unsure if they did lie to promote their cause. They also misled there consumers about animal testing of certain products. They claim it was unintentional but they should have researched and made a bigger effort to prevent this from happening, after all the company based its principles on this factor. Ethical issues also arise after the publication of the Business Ethics article by Entine. If his allegations are accurate then the company showcased a different image to its customers than what was really happening.
Philanthropic- After Anita Roddick’s book she donated her royalties to organizations she supported. They also produced a documentary series celebrating wisdom and the history of certain cultures and use funds for donations.
2. What is your assessment of the Jon Entine article and critique? What is your assessment of The Body Shop’s response to Entine’s Business Ethics article? Has the Body Shop misrepresented itself to stakeholders, and if so, how?
I think that Entine’s article raises a lot of questions about The Body Shops integrity and products. I wonder if his intentions were to inform the public or use it as his advantage and to make a profit. I think The Body Shops response could have been played differently. By Gordon obtaining unauthorized information about subscribers and sending letters to them was unethical. He should have addressed the issue publically or published his letters to let the readers see. If all the facts in Entine's article are correct then The Body Shop defiantly misrepresented itself. The allegations attack the mission statement and image the company was supposed to represent. Most consumers shop there because there is no animal testing and the “all natural” ingredients it advertised. The company misrepresented itself to its stakeholders and should be held accountable.
3. Jon Entine and others have accused The Body Shop of using intimidation to stifle critics. Does this appear to be a valid criticism? Was The Body Shop justified in hiring Hill & Knowlton to conduct a public relations campaign?
According to this article The Body Shop did somehow get the Vanity Fair to back down on their article. Apparently they said something that made them change their mind. Based on how much they were going to pay Entine for his services the article would have been profitable to them. Also, throughout the case they seem to respond to the negative press with lawsuits. I defiantly think they were justified with hiring H&K. They needed some positive press and views of the company. It seems obvious they needed some help in that area and hiring a company specializing in public relations would be beneficial to the company during this time.
4. Has the Body Shop’s reputation been damaged by the incidents in this case? How might the company improve its reputation? Do you believe the steps described in this case, including the hiring of an advertising agency, will help or hinder these efforts?
I think that after reading this case the reputations of the company has been damaged, compared to the first case my view completely changed. All of their missions and beliefs come into questions and I wonder if they used their policies and views as an advertising scheme to make money or if they just ran into trouble as the business expanded while trying to keep up. Regardless negative press and allegations can hurt any company. They can improve their reputation addressing the allegations and fix any problems with their products that aren’t representing the values the company stated for themselves. They could allow customers to see into the manufacturing process and do a documentary about their company. The process would allow stakeholders to get an inside look at how things are done and disprove Entine’s article. They should also issue a public apology if they are guilty of any accusations and stress there further commitment to fixing the problems and restoring the original essence The Body Shop had once it first opened. I think an advertising agency will help if they showcase how the products are formed and the benefits the company has to society and the organizations it supports. I think it was a good idea for them to hire the public relations firm in the case because the image of the company was being tarnished and they needed help to restore it. Responding to the Business Ethics magazine by writing letters to its subscribers was a poor decision and if they plan on solving problems by attacking criticism then it won’t help them restore their image.
5. Describe the roles you believe Gordon and Anita Roddick should play in The Body Shop’s future operations. How might a stockholder, a customer, a supplier, and an employee assess the roles that the Roddick’s should play?
Gordin and Anita Roddick need to take a step back and hire professionals to make the important strategic decisions to make the company successful. They can just be owners, on the board and help with the public interest groups or volunteer their time with activist to restore their image. As far as business decisions are concerned I think it is best to leave it up to the experts and oversee that the original mission is followed. I think that all stakeholders in the company would want them to leave it up to the experts to make sure the company thrives and they can trust that it won’t go out of business and hurt them in the end.
The Body Shop # 3
1. Did Anita Roddick betray her philosophy about advertising by beginning to advertise in the US market? Did this decision have ethical implications? Or is it just a business decision?
Anita did betray her philosophy but it was the only way to infiltrate the US market where advertising plays a big role in success of companies. It does have ethical implications to her customers since she took a firm stand but I defiantly think it was a good business decision. I also think that when moving to the US market it was important for her to change her strategy and she owed it to her shareholders to put forth her best effort and earn a profit.
2. Did the Body Shop’s social auditing program help save the firm’s reputation? Did the firm “snap back” from the damage done to its reputation in the mid- 1990’s?
I defiantly think the social auditing program helped the reputation. After Entine’s publically criticized the company and questioned its values, auditing them, stating the five values, and letting stakeholders follow the process was a good move. I don’t think the firm snapped back though because the company is still struggling and they face several legal issues and as a result they sold it to L’Oreal.
3. Do the low buyback prices offered to the US franchisees reflect poor body shop ethics or just the economic reality of risky investments?
Offering US franchises a low buy back was unethical on The Body Shop part. The franchises were expecting a profitable business after all the success in the UK and for so many franchises to file suits suggest they were given false promises and unfair disadvantages based on the allegations.
4. Is the Body Shop still regarded today as a socially responsible and ethical firm? Research the answer to this question and be prepared to report your findings.
I was pleasantly surprised when I researched the company’s website*. They had their values report and talked about their causes and described how the products were produced. They still seem committed to Anita Roddick’s mission and I don’t see any bad press about them expect for Entine’s site.
(*Reference: http://www.thebodyshop-usa.com/)
5. At the end of these cases, what is your impression of Anita Roddick? Comment on her strengths and weaknesses and a businessperson and leader. Was the sale of the company to L’Oreal and indication that Roddick’s philosophy had finally failed?
I think Anita Roddick was a strong business woman whose business just got too big and she was unable to manage it alone. Along the way initial values were lost in hopes to stay afloat in a hard market. I believe she had a strong initial strategy but executed it poorly. If she would have stayed a small business owner then she could have actually stayed committed to her beliefs. Her weaknesses were obviously in the financial aspect and how to execute her ideas. I think the sale to L’Oreal did indicate that her philosophy failed. By selling everything she stood for she sold out on herself. Now they may commercialize the company and change the essence of it. I see in the case they separated the requirements but by still having to answer to someone else who has control, it will be interesting to see how close to her values L’Oreal follows.
6. What will be the likely, longer term impact on The Body Shop’s values and priorities under the leadership of L’Oreal and upon Anita Roddick’s death? Is it in L’Oreal’s best interests to leave the company alone and let it go in the direction Anita had provided it, or should it be brought more into the mainstream of the company?
I think L’Oreal will market towards the same people but Anita’s beliefs will be altered. In L’Oreal’s position it would be in their best interest to stay true to the core values but market it to the appropriate segment and bring it to the mainstream. They could make a lot of money that way and advertise to people who have the same beliefs. Now there is an area of environmentalist and the new movement would be a good was to earn a profit.