Reference no: EM133054184

Assurance of Learning: Warby Parker-Combining Corporate Social Responsibility with Affordable Fashion

Read the overview below and complete the activities that follow.

The combination of socially responsible efforts a company chooses to pursue defines its corporate social responsibility strategy. The specific components emphasized in a CSR strategy will vary from company to company and are typically linked to a company's core values. In this exercise, you will be asked to evaluate the CSR strategy of Warby Parker.

The term corporate social responsibility concerns a company's duty to operate in an honorable manner, provide good working conditions for employees, encourage workforce diversity, be a good steward of the environment, and support philanthropic endeavors in local communities where it operates and in society at large. The combination of socially responsible endeavors a company elects to pursue defines its corporate social responsibility (CSR) strategy. The triple bottom line refers to company performance in three realms: (1) economic, (2) social, and (3) environmental. Increasingly, companies are reporting their performance with respect to all three performance dimensions.

Sustainability is a term that is used in various ways, but most often it concerns a firm's relationship to the environment and its use of natural resources. Sustainable business practices are those capable of meeting the needs of the present without compromising the world's ability to meet future needs. A company's environmental sustainability strategy consists of its deliberate actions to protect the environment, provide for the longevity of natural resources, maintain ecological support systems for future generations, and guard against ultimate endangerment of the planet. The moral case for social responsibility boils down to a simple concept: It's the right thing to do. There are also solid reasons CSR and environmental sustainability strategies may be good business-they can be conducive to greater buyer patronage, reduce the risk of reputation-damaging incidents, provide opportunities for revenue enhancement, and lower costs. Well-crafted CSR and environmental sustainability strategies are in the best long-term interest of shareholders for the reasons above and because they can avoid or preempt costly legal or regulatory actions.

Since its founding in 2010, Warby Parker has succeeded in selling over one million pairs of high-fashion glasses at a discounted price of $95-roughly 80 percent below the average $500 price tag on a comparable pair of eyeglasses from another producer. With more than 70 stores in the United States, the company has built a brand recognized universally as one of the strongest in the world; it consistently posts a net promoter score (a measure of how likely someone would be to recommend the product) of close to 90-higher than companies like Zappos and Apple.

Under its "Buy a Pair, Give a Pair" program, more than five million pairs of glasses have been distributed to needy people in more than 50 countries. Warby Parker also supports partners like VisionSpring, enabling them to provide basic eye exams and teach community members how to manufacture and sell glasses at very low prices, thereby providing vocational training and improving the standard of living in these communities. The average impact on a recipient of a pair of donated glasses was a 20 percent increase in personal income and a 35 percent increase in productivity.

Efforts to be a responsible company expand beyond Warby Parker's international partnerships. The company voluntarily evaluates itself against benchmarks in the fields of "environment," "workers," "customers," community," and "governance," demonstrating a nearly unparalleled dedication to outcomes outside of profit. The company is widely seen as an employer of choice and regularly attracts top talent for all roles across the organization. It holds to an extremely high environmental standard, running an entirely carbon neutral operation.

While socially impactful actions matter at Warby Parker, the company is mindful of the critical role of its suppliers as well. Both founders spent countless hours coordinating partnerships with dedicated suppliers to ensure quality, invested deeply in building a lean manufacturing operation to minimize cost, and sought to build an organization that would keep buyers happy. The net effect is a very economically healthy company-they post around $3,000 in sales per square foot, second only to Apple stores-with financial stability to pursue responsibilities outside of customer satisfaction.

The strong fundamentals put in place by the firm's founders blend responsibility into its DNA and attach each piece of commercial success to positive outcomes in the world. The company was recently recognized as number one on Fast Company's "Most Innovative Companies" list and continues to build loyal followers-both of its products and its CSR efforts-as it expands.

The goal of this exercise is for you to understand the concepts of corporate social responsibility and environmental sustainability and of how companies balance these duties with economic responsibilities to shareholders.

Before completing this exercise, be sure to review Chapter 9, "Ethics, Corporate Social Responsibility, Environmental Sustainability, and Strategy."

How has Warby Parker's CSR strategy contributed to its success in the marketplace?

Multiple Choice

• Their engagement in broader philanthropic initiatives has created a positive image and reputation among consumers.
• The company voluntarily evaluates itself against benchmarks in the fields of environment, workers, customers, community, and governance.
• They have eliminated any adverse impact on the environment stemming from their business activities.
• The company is widely seen as an employer of choice.
• All of these are correct.