A Case Study of Panasonic vs. Sony Corporate Social
Responsibility in Environmental Practices
Kristin Johnson – Kristin.johnson@eagles.usm.edu
0
– ABSTRACT
Panama’s dollar-based economy, developing economic region and strategic location in Latin
America make it an attractive location for businesses looking to grow internationally. The
Panama Canal and the Colon Free Zone mark Panama as the second largest trading port
worldwide and a main trading partner for the United States (Doing Business in Panama, 2012). A
current project aimed at expanding the Panama Canal, is estimated to be completed in 2015, and
will support continued economic growth and encourage business development in upcoming
years. An examination of environmental priorities, enacted regulations and corporate
environmental practices are compared and contrasted with regional Panasonic Panama
headquarters, and the United States’ Sony Corporation of America. Taking into account
different stages of economic growth for each respective country provides insight into degrees of
regulation and regional expectations of sustainability practices. Striving to maintain economic
growth, and establish itself as a strategic business center, Panama must balance environmental
regulatory policies with the need to support an attractive business environment. To obtain
qualified data for each company and country, an extensive internet data collection process was
followed. Information and data were collected from internet and database queries utilizing
reputable government sites and national news sources. This case study explores the differences
in environmental priorities between, Panasonic versus Sony, to provide a framework for
developing dynamic company initiatives to support sustainability as a corporate social
responsibility. A focus on local activities demonstrates company and employee engagement, as
well as varying regional needs, and environmental concerns, for each country. Findings from
this project reveal similarities in operational initiatives related to conserving resources,
promoting sustainability and business process efficiencies. Primary differences involved a
highly-regulated business environment in the U.S. versus Panama, as well as community-specific
programs emphasizing restoration efforts by Sony Co. and educational initiatives by Panasonic.
Impacts of the results from this research are beneficial for developing countries looking to
implement environmental policies and for companies facing pressure to increase environmental
activism. A balanced analysis of strategies employed by each company as well as governmental
restrictions in each country reveal insights into international policy regulation, regional
environmental awareness, and effective company processes for reducing the corporate
environmental footprint.
1 – INTRODUCTION
1.1 Defined Topic of Study
Corporate Social Responsibility (CSR) as defined by the World Business Council is, “the
continuing commitment by businesses to behave ethically and to contribute to economic
Panasonic vs. Sony Environmental Practices
2
development while improving the quality of life of the workforce and their families, as well as of
the local community and society at large” (“Corporate Social Responsibility”, 2003, para. 1).
CSR plays a critical role in a company’s business polices as related to environmental practices.
Corporate environmental responsibility outlines a company’s strategy for reducing its
environmental footprint through energy savings, recycling initiatives, decreased CO2 emissions,
and sustainability. Panama Panasonic and Sony Corporation of America, include corporate
responsibility manifestos in annual review publications as well as part of their online web
content, with varying degrees of environmental initiatives relative to each.
1.2
Overview of United States Business Environment
America’s business environment is renowned for innovation and creativity, as well as an
educated and skilled labor force. The United States claims one of the most advanced and diverse
economies in the world, with a labor force of 153.6 million, stable inflation and generally low
unemployment. Managerial, professional and technical occupations contribute almost 40% to
national GDP, which totaled $15.66 trillion in 2012, the highest in the world (International
Monetary Fund [IMF], 2011). Financing in the U.S. is readily available through multiple forms
of capital investment, making it an attractive location for new businesses. Availability of capital,
as well al heavy investment in research and the accessibility of new technologies, mark the U.S.
as a competitive global rival in the international business landscape (Porter, 2012).
The below graph illustrates U.S. GDP growth, which averaged 2% over the last thirty years, with
a real GDP per capita of $42,633 (IMF, 2012). The 2008 Great Recession brought about a
drastic drop in GDP and a spike in unemployment, illustrated in Graph 1, however, the
implementation of two stimulus bills in late 2008 and early 2009 helped encourage growth. The
last two years have seen improved unemployment rates (see Graph 2) and GDP year over year
increases. Inflation is hovering around 3%, with expectations to decrease to 2% (ten year
average 2.5%) and remain stable over the next few years. Currently, the top financial concern
for the U.S. is a growing budget deficit totaling $16.8 trillion, as of March 2013, which needs to
be addressed for sustained economic growth going forward (IMF, 2012).
25,000.00
USD (Billions)
20,000.00
15,000.00
Real GDP
10,000.00
Nominal GDP
5,000.00
0.00
International Monetary Fund, World Economic Outlook Database, October 2012
Graph 1: U.S. GDP Real & Nominal (1980-2017)
Panasonic vs. Sony Environmental Practices
3
12
% Percent
10
8
6
4
2
0
International Monetary Fund, World Economic Outlook Database, October 2012
Graph 2: U.S. Unemployment (1980-2017)
1.3
Overview of United States Environmental Practices and Sony CSR
Environmental protection has been a top concern and closely monitored in the U.S. over the past
forty years. Recent bills such as the American Clean Energy and Security Act of 2009, as well
as previous laws including the 1970 Clean Air Act, amended in 1990, and the Clean Water Act
enacted in 1972, have focused much U.S. attention on environmental regulations and business
compliance. Regulation is monitored in part, by the Environmental Protection Agency (EPA), a
federal agency established to write and enforce environmental standards on a national basis. The
EPA oversees and enforces laws related to business activities such as transportation, facilities
management, building construction, and products and packaging, with the authority to issue fines
and sanctions against businesses not adhering to policies. The EPA currently employs over
17,000 full-time personnel to monitor programs and work on EPA initiatives with goals such as
reduced greenhouse gases, elimination of harmful contaminants, reduced water pollutants and
waste reduction, aimed at global environmental and human health protection (McGarity, 2004).
The below graph depicts U.S CO2 emissions by year and per capita. Reduction in emissions
from 2005 on, illustrate concentrated efforts nationwide to decrease environmental pollution.
6,000,000
25
20
15
Tons
Ktons CO2
5,500,000
5,000,000
10
5
0
4,500,000
Graph 3: U.S. CO2 Emissions
(1990-2011)
Graph 4: U.S. CO2 Emissions Per Capita
(1990-2011)
*Emission Database for Global Atmospheric Research (EDGAR), release version 4.2. 2011
Panasonic vs. Sony Environmental Practices
4
California has encountered several environmental issues dating back as early as 1947. Cases
involving smog attacks, oil spills and high air toxicity concerns, have led to statewide awareness
of environmental protection and sustainability efforts in California. Shortly after the
establishment of the EPA in 1970, California passed the California Environmental Quality Act to
provide statewide environmental protection of local natural habitats. In accordance with the
statute, any public or private project affecting the local environment must disclose environmental
impacts and provide validation for projects negatively effecting the environment (“California
Wants to Lead America,” 2013). While increasing hurdles in the business industry, this has
allowed California to regulate new project developments in the state and led to environmentally
friendly alternatives to several business proposals.
Increasing awareness and environmental concern led to Sony’s launch of a company-wide
environmental plan, dubbed “Road to Zero” in April of 2010 (www.sony.net). The plan’s
objectives include a forty year incremental corporate environmental strategy, looking to achieve
a zero environmental impact by 2050. The plan is divided into five-year objectives using,
“backcasting methods to set specific mid-term environmental targets” (“Sony Launches Road to
Zero,” 2013, para. 1). Targets are focused on four distinct perspectives: Conserving resources,
curbing climate change, promoting biodiversity, and controlling chemical substances. Attention
is also given to the product life cycle where Sony seeks to develop energy saving technologies,
reduce energy consumption in operations, partner with climate-friendly suppliers, and eliminate
harmful chemical substances. To reinforce its commitment to environmental efforts, Sony
partnered with the U.S. Environmental Protection Agency on July of 2011, pledging to work
only with certified recyclers under the National Strategy for Electronics Stewardship
(www.sony.net). Progress reveals, as of January 2012, Sony “has exceeded its waste
minimization targets across all of its global business sites, achieving a 54% reduction rate in
2010 set against a 40% objective” (Perella, 2012). Future targets include increased use of
renewable energy, further development of energy saving products, and continued reduction of
CO2 and greenhouse gases, with a 2015 target actualization date.
1.4
Overview of Panama Business Environment
Panama’s economy has seen rapid growth in recent years, with the last five years averaging
8.75% yearly increases in GDP (IMF, 2011). The current labor force boasts 1.509 million with
an unemployment rate of 4.4% (see Graph 6). The majority of labor is concentrated in the
service sector with 64.4% of the population working in services, largely provided by
employment at the Panama Canal (The World Factbook, 2009). Fueling growth is the
development of Panama’s infrastructure as an emerging country, specifically a project aimed at
widening the Panama Canal which is expected to be completed in 2015. Despite economic
growth Panama still suffers from massive income inequalities among its population, with 30% of
the country living in poverty. In addition to income distribution, concerns about unstable politics
also increases potential risks in the business environment.
Panama’s logistics industry is its main source of GDP. The canal serves as a worldwide hub for
trading and the presence of the Colon Free Zone mark Panama as a strategic business center.
Recently the U.S. signed a ratified free trade agreement with Panama in October 2011,
increasing U.S. import and export market share in Panama and reinforcing the importance of
Panama as a critical trading partner for the United States. The widening of the canal is bringing
additional business and increased opportunity to the area and is expected to lead to further
economic growth and development in future years (Leach, 2011).
$ (Billions)
Panasonic vs. Sony Environmental Practices
70
60
50
40
30
20
10
0
5
Real GDP
Nominal GDP
International Monetary Fund, World Economic Outlook Database, April 2013
% Percent
Graph 5: Panama GDP – Real & Nominal (1980-2018)
20
18
16
14
12
10
8
6
4
2
0
International Monetary Fund, World Economic Outlook Database, April 2013
Graph 6: Panama Unemployment (1980-2018)
1.5
Overview of CSR and Environmental Practices in Panama
Panama’s environmental restrictions and regulations are monitored and enforced through the
governmental agency, Autoridad Nacional del Ambiente (ANAM) (National Environmental
Authority). Primary environmental concerns in Panama involve the preservation of wetlands,
and regulations to monitor water pollution. Existing policies in place include completion of an
Environmental Impact Assessment for business activities and developments as well as the Code
of Mineral Resources intended to protect indigenous areas (“90% of Panamanians,” 2011).
However, despite the presence of general laws, policy enforcement is loosely monitored.
According to a poll by the Barometer of the Americas and Public Opinion in Latin America, nine
out of ten respondents want stronger environmental protection laws, and 45.1% cited corruption
as a major issue with enforcement (“90% of Panmanians,” 2011). Current laws in place, such as
Law 41, enacted in 1998, allow businesses “loop holes” for project approvals for
environmentally damaging activities to get approved (Arosamana, 2010). Panama’s increasing
GDP, economic growth, and the upsurge of business development, has made balancing economic
progress with environmental considerations, increasingly challenging. Graphs 7 and 8 below,
demonstrate growing CO2 emissions, as well as per capita emissions, in Panama which have
almost doubled since 2005. Policy will become increasingly important as Panama’s economy
Panasonic vs. Sony Environmental Practices
6
continues to grow. Figure 1 below illustrates the proportion of CO2 emissions by country for
North America.
12000
3.5
10000
3
2.5
Ktons CO2
8000
2
6000
1.5
4000
1
2000
0.5
0
0
*Emission Database for Global Atmospheric Research (EDGAR), release version 4.2. 2011
Graph 7: Panama CO2 Emissions
(1990-2010)
Graph 8: Panama CO2 Emissions Per Capita
(1990-2010)
U.S. - 5.4 million
Panama - 11,044
Figure 1: CO2 Emissions by Country (2011)
*Emission Database for Global Atmospheric Research (EDGAR), release version 4.2. 2011
Panama’s existing biodiversity and forested areas necessitate preservation of resources and
monitoring of future developments. Panasonic Panama’s corporate environmental strategy
accounts for these regional needs and centers on seven focus areas: CO2 emissions reduction,
resources, water, chemicals, biodiversity, stakeholder, and regional efforts. Consideration of
environmental impact is evident through Panasonic’s initiatives. Panasonic emphasizes product
efficiency through heavy R&D for product innovations. Investments in product development
have increased product efficiency goals with successful results on targets such as waste
recycling, currently aimed at 99.5% by 2019, comparable with Sony’s initiatives to achieve a
99% rate by 2015. However an external product emphasis has lowered attention on energy
efficiency and resulted in higher CO2 level emissions as opposed to U.S. counterparts. Figure 2
below, provided on Panasonic’s corporate site, details increased companywide emissions before
Panasonic vs. Sony Environmental Practices
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efforts are realized in 2019 and CO2 levels begin to decrease. A local partnership to support
sustainability efforts was formed on June 18th, 2008 with Panama’s National Association of
Nature (ANCON). Through this alliance, Panasonic works to support recycling efforts,
reforestation projects, educational lectures and environmental activities to spread awareness
locally (http://www.panasonic.com.pa/about/eco/). Corporate funding and sponsorship focus
locally in Panama, looking to educate children and consumers on eco-preservation and
sustainability efforts, as well as business on innovative “green” products to reduce environmental
impact.
*Panasonic-la.com/eco/ecoideas
Figure 2: Panasonic Eco Idea Targets
1.6 Report Focus
The focus of this report is a case study of Panasonic vs. Sony corporate social responsibility in
environmental practices. More specifically, this report compares environmental initiatives,
regulations and impact of corporate social responsibility strategies for Sony Corporation of
America and Panasonic Panama.
2 – INFORMATION AND DATA COLLECTION APPROACH
2.1 Data Collection
Data collection for this study was obtained through extensive internet research. A face-to-face
company interview in Panama was scheduled but canceled last minute and attempts to collect
information via email were unsuccessful. Internet sources were leveraged to obtain needed
information on environmental polices relative to each company and within each country.
2.2 Internet Search
Internet research was conducted using Google and USM library search engines. Databases
including, Business Source Complete, LexisNexis Academic, Encyclopedia Britannica,
International Monetary Fund, The World Bank and Harvard Business Review were employed to
uncover fundamental information regarding U.S. and Panama environmental regulations, local
sustainability awareness, and direct targets to measure environmental goals for each company.
Sources used include peer reviewed academic papers, government databases, industry journal
articles, corporate websites and national news archives. Databases and corresponding web
Panasonic vs. Sony Environmental Practices
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addresses for acquired information are detailed in Table 1. Key words used throughout the
information search are included in the supplementary table below.
Table 1: Databases
Database
World Economic Outlook
Database
Business Monitor
International
URL
Imf.org
www.businessmonitor.com
U.S. Business Environment
www.credoreference.com
Corporate Social Responsibility
Definition
http://edgar.jrc.ec.europe.eu
CO2 Emissions by Country and
Year
www.epa.gov
U.S. Environmental Regulations
and Restrictions
www.inece.org
Panama Environmental
Regulations and Restrictions
www.PRSgroup.com
Panama Country Report
Credo Reference
Emission Database for
Global Atmospheric
Research (EDGAR)
Environmental
Protection Agency
International Network
for Environmental
Compliance and
Enforcement
Political Risk Services
Group
Information
Country level data > Panama
Country level data > U.S.
Table 2: Keyword Search
Corporate Social Responsibility
Panama
U.S.
Corporate Environmental Strategy
Environmental Regulations
Environmental Concerns
Environmental Initiatives
Sony Co. of America
Panasonic Panama
2.3 P anama Interview Main Goal
A secondary data collection was intended through direct interviews with Panama business
executives at Panasonic headquarters. The main objective of the interview was to gain an
understanding of what resources Panasonic employs in maintaining environmental compliance
and what additional steps Panasonic is taking to reduce its environmental footprint locally.
However, due to extenuating circumstances and scheduling conflicts, the interview was canceled
last minute and case study findings were based on internet research alone.
2.4 Interview Instrument
After 40 years in operation, Panasonic Latin America became actively involved in environmental
activities with its 2008 agreement with ANCON, supporting educational and environmental
regional projects (http://www.panasonic.com.pa/about/corporate/). Recent regulations and
Panasonic vs. Sony Environmental Practices
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global initiatives mandated quick implementation of sustainability practices and ongoing efforts
of corporate social responsibility in the public eye. Questions regarding internal processes used
to roll-out the new initiatives, and how Panasonic monitored implementation and plans to
support efforts going forward were meant to be addressed during an on-site meeting. Included
below is a copy of the interview template prepared for the meeting.
Table 3: Panasonic Questionnaire
What were/are the main challenges faced in ensuring environmental compliance
locally?
What internal instruments are used to monitor environmental impact?
Does Panasonic offer a "take back" consumer recycling program locally?
What are specific steps Panasonic is taking during the next five years to reduce its
environmental footprint?
What do you feel will be the hardest challenge in maintaining Panama's ecosystem
despite rapid business development?
Are any employee incentives offered to encourage environmental activism locally?
What do you foresee as the biggest environmental hurtle to overcome in upcoming
years?
2.5 Panasonic Interviewee Profile
Unfortunately, the scheduled meeting with executive Mariana Samudio was canceled due to
schedule conflictions so Panasonic company information obtained for this report was gathered
exclusively from internet research.
3 – CASE STUDY
3.1 Panasonic Panama Headquarters Location
Situated just east of the Panama Canal on the South side of Panama, Panasonic Panama
headquarters are located at Panasonic, Via Simon Bolivar, Ave Transistmica, Contigua Al,
Panama City, Panama. Figure 3 below, depicts the Panasonic location within the country.
*“Google Maps” 2013
Figure 3: Panasonic Panama Headquarters
Via Simon Bolivar, Ave Transistmica, Contigua Al, Panama City, Panama
Panasonic vs. Sony Environmental Practices
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Figure 4: Panasonic Panama Headquarters
3.2 Overview and Characteristics of Panasonic Panama
Originating as “National Panasonic” in 1970 in the Republic of Panama, Panasonic’s first sales
were recorded under the brand name “National,” and served local markets in Latin America.
Early interest in Panama led this Japanese-based, multi-national corporation, to target goals in
becoming the number one consumer electronics brand for Latin America. An aggressive market
expansion was undertaken and soon Panasonic’s operating area expanded to include current
markets of, Colombia, Ecuador, Uruguay, Paraguay, the Caribbean and other regions of Central
America and Brazil (http://www.panasonic.com.pa/about/corporate/history/). Panasonic Panama
serves as the central headquarters hub for all Latin American sales. North and South American
sales for Panasonic represent 12% of the company worldwide total or $9.4 billion (966.5 billion
yen at exchange rate 1USD:102.44JPY), with global sales of $76.9 billion (7,846 billion yen) in
fiscal year ended March 31st, 2012 (Panasonic Corporation Annual Report, 2012). Products
currently offered in Panama range from audio and video electronic equipment to lighting,
communications and appliances. Sales and service focus on both direct to consumer sales as
well as business to business relationships.
3.3 Panasonic Panama Environmental Activities
Panasonic Panama takes an active role in supporting local ecosystem preservation and
encouraging community activism. In addition to a global company-wide program, “Eco Ideas,”
Panasonic also participates in regional events through volunteerism, sponsorship and fundraising.
Recent contributions include “Panasonic Cares – Month of the Oceans,” an employee volunteer
beach clean-up event, which resulted in the collection of 3.134 pounds of plastic waste gathered
and recycled (http://www.panasonic.com.pa/about/eco/). In addition, local contributions to
promote environmental awareness include, the establishment of “El Caucho,” an outdoor
recreation and 390 meter trail, located in the middle of the city, construction of a visual
education center dedicated to improving environmental awareness in the community, and
Panasonic vs. Sony Environmental Practices
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ongoing ecosystem education materials for children which include an international contest to
compete on the basis of eco conservation ideas. Business initiatives also seek direct impact
through actively planting trees to maintain Panama’s ecology. During 2008, Panasonic’s
“Project Relay Eco Ideas” resulted in over 1,000 trees planted along the Channel.
Continued investment in research and development for eco-friendly advanced products is a main
focus for Panasonic initiatives, while promoting increased sustainability for businesses and
consumers drives much of Panasonic’s local activism. A 2009 convention headed by Panasonic,
featured newly developed organic products available for local review, testing and educational
consumption. Panasonic performed “ecotours” to interested consumers and businesses
describing everyday actions to take in reducing one’s environmental footprint as well as
demonstrations and explanations of Panasonic products currently available to conserve resources
and reduce waste for corporations and consumers.
Figure 5: Pansonic Month of the
Oceans
Figure 6: Panasonic Local Education
Figure 7: Panasonic Business and Consumer Eco-product Expo
Panasonic Panama uses a two-prong approach, both consumer-focused and business driven,
consistent with their global green plan concept of “Green Life” innovation and “Green Business”
innovation (Panasonic Sustainability Report, 2012). Active participation locally, ensures
sustainability remains at the forefront of environmental initiatives, and investment in R&D
allows further opportunity for Panasonic to tackle global eco challenges and promote green life
Panasonic vs. Sony Environmental Practices
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not only operationally but throughout the life of the product and through consumer and business
use, the below figure outlines Panasonic’s Green Plan strategy for 2018.
*Panasonic Sustainability Report (2012)
Figure 8: Panasonic Green Plan 2018
3.4 Sony Corporation of America Distribution Center Location
Sony Corporation of America’s manufacturing and distribution center is located on the west side
of the United States in San Diego, California, just off major interstate I-15 and twenty miles
north of the city center.
*“Google Maps” 2013
Figure 9: Sony Corporation of America Manufacturing and Distribution Center
16530 Via Esprillo, San Diego, CA 92127
Panasonic vs. Sony Environmental Practices
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Figure 10: Sony Corporation San Diego Headquarters
3.5 Overview and Characteristics of Sony Corporation of America
Sony is an international Japanese-based consumer and business electronics company, publically
owned and traded on the New York Stock Exchange. Known for early sales success of transistor
radios, Sony products now include a breadth of assortment from CD’s, computers, smartphones,
and TV’s to professional broadcast and video equipment (www.sony.net). Several years of
successfully exporting to the U.S. led Sony to establish offices in New York in 1960 and
increasing demand prompted construction of a California production facility in 1970. The
popularity of Sony’s color TV launched late in the sixties, coupled with growing U.S. market
share called for faster turnaround and streamlined production of products, leading to the current
San Diego production facility and distribution center which boasts 394,000 square feet of
building space, over 1 million square feet of industrial space and 2,500 employees (Brass, 1996).
U.S. Sony sales totaled $10.436 billion (1,064 billion yen at rate of 1USD:102.44JPY) for fiscal
year 2012 and represent 16% of company worldwide sales reported at $66.658 billion (6,800
billion yen) for fiscal year ended March 31st, 2012 (Sony Annual Report, 2012). Sony sales are
comprised of 50% consumer electronics, 30% professional products and 20% component parts to
original equipment manufacturers (www.sony.net).
Figure11: Breaking Ground at the San Diego Development Site in 1970
Panasonic vs. Sony Environmental Practices
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3.6 Sony Corporation of America Environmental Activities
In addition to Sony’s “Road to Zero” environmental corporate strategy, Sony also contributes to
local communities through its Global Environmental Management System, employee
volunteerism and community activism. Under the Global Environmental Management System,
Sony operates 31 business divisions and sites in North America that are ISO (International
Organization for Standardization) certified and third party inspected on a yearly basis to ensure
recycling and environmental management standards are upheld at Sony manufacturing and nonmanufacturing sites. Locally in California, Sony has partnered with the University of California
Santa Barbara, to provide funding, technology and equipment to students researching
environmental projects and to benefit educational enrichment of the local community on
sustainability issues. Funding to local non-profit events such as “I Love a Clean San Diego,”
“Creek to Bay Cleanup,” “Kid’s Ocean Day,” and “California Coastal Cleanup Day,” support
community activism and encourage company volunteerism. In 2012, a total of 359,000 pounds
of waste were collected from volunteers with 93,000 pounds recycled (www.sony.net). One of
Sony’s largest environmental programs is a nationwide “take-back recycling program.” Through
the “take-back” program, consumers are able to return any Sony product for recycling at no
charge at drop-off locations across the country (www.sony.net).
Sony also sponsors a company-wide Global Volunteer Day, encouraging all employees to
participate in local volunteer activities. Efforts in 2012 included transforming a neglected
schoolyard park in Brooklyn into an interactive outdoor classroom, where Sony volunteers
conducted sustainability workshops for neighborhood kids (www.sony.net). In Los Angeles, tree
planting and neighborhood cleanups are an ongoing commitment for Sony employees.
Figure 12: Sony Global Volunteer Day
Figure 13: Sony Beach Clean-Up
Panasonic vs. Sony Environmental Practices
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Figure 14: Elementary School Volunteer for Mural Painting
A history of environmental issues in California has led to eco-conscious residents and
consumers, encouraging “green” products and sustainability initiatives for businesses. To this
effect, Sony’s local activities focus on rebuilding and restoring through sponsorship, fundraising
and volunteer efforts, as well as an internal focus on reducing supply chain environmental impact
and increasing energy efficiency standards through initiatives and investment.
4 – RESULTS AND RESULTS IMPACT
4.1 Comparison of Panasonic Panama and Sony Corporation of America
Aspects regarding environmental initiatives, targeted environmental goals, community activism
and local impact of corporate processes for Panasonic Panama and Sony Corporation of America
were compared to illustrate similarities and differences between the companies and the varying
degrees of regulation employed by each country. Specific comparisons were drawn between the
company’s operations, product development, and energy usage as well as detailed reviews of
each company’s corporate environmental strategy plan and future targets.
4.2 Similarities between Panasonic Panama and Sony Corporation of America
Recognizing the importance of contributing to a reduced environmental footprint, Panasonic
Panama and Sony Corporation of America are addressing greenhouse gas emissions, control of
waste disposal, and increased energy efficiency as part of corporate environmental strategy as
well as supporting local biodiversity through volunteer efforts and community activism. In an
effort to promote eco-values, both companies have partnered with local organizations to monitor
the impact of company development plans, operational processes and supply chain
improvements across the region. Panama’s Panasonic works closely with the National
Association of Nature to support local development of educational environmental facilities along
with preservation and reforestation of Panama’s natural plant and marine life communities. In
America, a close collaboration between Sony Corporation and the U.S. Environmental Protection
Agency proves advantageous for ensuring increased green energy usage. Through the EPA’s
Green Power Partnership, Sony has committed to purchase 44% of energy through renewable
Panasonic vs. Sony Environmental Practices
16
and green energy sources, leading to reduced CO2 emissions and lower overall carbon footprint
(www.sony.net).
In-house allocation of resources focuses on the development of energy efficient products as a
priority for both companies. Through innovation and design initiatives, Panasonic Panama and
Sony Corporation claim “Energy Star” ratings on all consumer goods products (Guide to
Greener Electronics 18, 2012). Energy Star standards signify goods using 20%-30% less energy
than required by federal standards (Tugend, 2008). In addition, regulation of paper purchase is
enforced for both companies to ensure only reputable distributors, not involved in illegal logging
or deforestation activities, are used for paper purchases. Regarding the control of chemical
substances, both companies cite this as an initiative; however neither company provides figures
relative to usage and disposal or specifics on how this is being addressed or controlled internally.
According to Greenpeace Magazine, this is the biggest gap in each company’s execution of
corporate environmental strategy plans (Guide to Greener Electronics 18, 2012).
Commitment locally is evident through company volunteer efforts, sponsorship, and donation to
regional environmental groups in support of environmental facilities. Community activism in
Panama is focused on educating the local population about environmental concerns, eco-friendly
products, and contributions to protect the local ecosystem. At Sony, corporate social
responsibility focuses on the creation of educational facilities, while supporting the creation of
green parks and reforestation efforts. Emphasis on community activities in each country is
tailored to regional needs with both companies locally involved in the development of
environmental programs. A summary of similarities between the companies is provided below in
Table 6.
Panasonic vs. Sony Environmental Practices
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Table 6: Similarities of Environmental Initiatives
Similarities
Panasonic
Sony
"Eco Ideas"
"Road to Zero"
Announced in 2010 with a seven layer focus
on: Resources, Water, CO2 Emissions,
Biodiversity, Chemicals and Stakeholder
and Regional Efforts
Announced in 2010 with a four layer focus
on: Conserving Resources, Curbing Climate
Change, Promoting Biodiversity and
Controlling Chemical Substances
Local Conservation
Alliance
Panama's National Association of Nature
June 2008 - support recycling, reforestation
projects, educational lectures and
environmental activities to spread the
awareness locally
U.S. Environmental Protection Agency
April 2009 – Green Power Partnership,
committed to purchase 44% of all energy
from renewable or green energy sources
R&D of Energy
Efficient Products
Products meet or exceed "Energy Star"
standards
Products meet or exceed "Energy Star"
standards
Biodiversity
Green Purchasing Policy
Commit to green paper purchases and
elimination of suppliers involved in illegal
logging or deforestation
Paper and Printed Material Purchasing
Policy
Reducing company paper usage and
prioritizing suppliers of green products
Controlling
Chemical
Substances
No processes, details or figures provided
outlining legislation or progress
No processes, details or figures provided
outlining legislation or progress
Renewable Energy
Use
No targets set or figures provided
No targets set, however renewable energy
accounts for 10% of total electricity
purchased
Community
Activism
Active locally in supporting regional cleanup efforts, sponsoring educational learning
facilities, funding outdoor educational
recreation establishments and planting trees
to support local ecosystem.
Active locally in supporting regional cleanup efforts, sponsoring educational learning
facilities, funding outdoor educational
recreation establishments and planting trees
to support local ecosystem.
Company
Environmental
Sustainability Plan
The similarities of these company initiatives are important because they illustrate, despite
varying degrees of expectations by local communities, and differing levels of operational
regulation in each country, company CSR policies often drive regional environmental awareness
and impact.
4.3 Differences between Panasonic Panama and Sony Corporation of America
Several similarities between the two companies and countries have been identified; however
differences in management of environmental initiatives and country operating regulations are
present between the companies and the locations. Reviewing each company’s environmental
strategy, Panasonic demonstrates a competitive external focus, aiming to become the number one
green electronics retailer by 2018. Sony takes an internal focus, establishing plans to reduce its
environmental footprint to zero by the year 2050. Allocation and investment of resources
specific to each company highlight the difference between external and internal environmental
Panasonic vs. Sony Environmental Practices
18
initiatives. Panasonic’s environmental processes are tailored to achieve the number one green
retailer spot in the industry. For Panasonic, this means extending environmental benefits
throughout the life of the product. Panasonic aims to reduce its environmental impact through
consumer usage of products; therefore Panasonic invests heavily in R&D for green product
development. However, reductions of internal operational and supply chain efficiencies are
prioritized behind eco-product development, with no plans, targets or strategy laid out past 2018.
Specific targets and numbers regarding clean energy usage and reduction of greenhouse gases
have not been identified by the company (Guide for Greener Electronics 18, 2012). Conversely,
Sony’s corporate environmental strategy takes an internal focus with main goals of reducing
impact of manufacturing, distribution and operational systems while supporting green processes.
Sony prioritizes supply chain improvements with a forty year plan and five year incremental
targets to reduce its environmental footprint. As the company progresses, targets are reevaluated and adjusted to ensure the company remains on track to a zero footprint by 2050.
However, less focus on external and consumer impact has led to shorter product life cycles and
caused Sony to fall behind Panasonic in overall product development for “green” items (Guide
for Greener Electronics 18, 2012).
An analysis of Panasonic and Sony by the Greenpeace Guide to Greener Electronics provides a
framework for comparing energy usage, product efficiency and operational improvements as
related to increased sustainability efforts. As of November 2012, Sony ranked 8th by Greenpeace
Guide to Greener Electronics out of sixteen consumer electronics companies, scoring high marks
for production of energy efficient products, clean electricity production and implementation of
their “take-back” recycling program. Panasonic currently holds the 11th spot, slightly down from
Sony, due to not reducing greenhouse gas emissions over the prior year. However, Panasonic
still scores high marks for energy efficient products and longer product life cycles where it
invests heavily (Guide to Greener Electronics, 2012)). Side by side scorecards for both
companies are provided in Tables 8 and 9 below.
Panasonic vs. Sony Environmental Practices
19
Table 8: Sony Greenpeace Score Card – November 2012
Zero
Low
Medium
High
Energy
Disclose and set targets for operational GHG emissions and RE supply
Disclose and set targets for supply chain GHG emissions and RE supply
Clean Electricity Plan (CEP) ENERGY
Products
Clean Energy Policy Advocacy
Product energy efficiency
Avoidance of hazardous substances in products
Use of recycled plastic in products PRODUCTS
Operations
Product life cycle
Chemicals management and advocacy
Policy and practice on sustainable sourcing of fibres for paper
Policy and practice on avoidance of conflict minerals OPERATIONS
Provides effective voluntary take-back where there are no EPR laws
www.greenpeace.org
Table 9: Panasonic Greenpeace Scorecard
Zero
Low
Medium
High
Energy
Disclose and set targets for operational GHG emissions and RE supply
Disclose and set targets for supply chain GHG emissions and RE supply
Clean Electricity Plan (CEP) ENERGY
Products
Clean Energy Policy Advocacy
Product energy efficiency
Avoidance of hazardous substances in products
Use of recycled plastic in products PRODUCTS
Operations
Product life cycle
Chemicals management and advocacy
Policy and practice on sustainable sourcing of fibres for paper
Policy and practice on avoidance of conflict minerals OPERATIONS
Provides effective voluntary take-back where there are no EPR laws
www.greenpeace.org
In addition to internal and external emphasis in environmental plans, cross-company differences
also include country regulations, monitoring of business processes and validation of
environmental claims. Third party monitoring efforts are required for several U.S. regulations,
with Sony currently operating thirty-one business divisions in North America that are ISO
certified by third party inspection. It is important to note that Panasonic does not offer
certification for third party inspections of environmental standards. External verification
combats corruption and falsification of company information, a process that would benefit a
company in Panama however is lacking at Panasonic. In regards to business processes, specific
internal practices such as regulation of air toxicity, is highly emphasized and monitored at Sony
who has created specific targets and steps to achieve reduced greenhouse gas emissions (GHG).
A goal of 30% reduction by 2015 saw actual results of 32% reduction in total emissions by 2011
Panasonic vs. Sony Environmental Practices
20
(www.sony.net). Sony’s success at GHG reduction illustrates the investment in internal
practices to reduce environmental impact as opposed to Panasonic who has been hovering
around a 23% reduction rate since 2006 and has not targeted further absolute reduction goals
(www.panasonic.com). Panasonic quotes GHG targets in millions of tons; however they do not
show proportional reduction to overall GHG emissions, resulting in arbitrary figures. Comparing
clean electricity goals, similar findings are present. A Green Power Partnership with the EPA
and current purchases of 10% renewable energy, mark Sony as a leader in green-energy
commitment. Panasonic, on the other hand, does not publish details of renewable energy usage
or provides plans for future green-energy targets. U.S. regulations such as the Clean Air Act and
monitoring by the Environmental Protection Agency provide greater motivation for companies in
the U.S. to reduce and monitor emissions, while tax credits provide incentive for continued
investment in green energy (www.epa.gov). As a newly emerging country, Panama lacks the
experience for implementation and enforcement of such laws and is in the process of laying
groundwork for monitoring businesses and establishing preservation laws (“90% of
Panamanians,” 2011).
Outside of internal controls such as air toxicity and clean energy plans, Panasonic claims a much
higher external focus with investment in waste recycling rates and product life. Panasonic
operates at a 98.9% waste recycling rate, almost nine percent higher than Sony, which can be
attributed to their use of post-consumer recycled plastics in new product development. This high
waste-recycling rate is also illustrated by their production of long-lasting products. Panasonic
looks to reduce environmental impact through consumer and business usage. Sony fails to
provide specifics on warranties and life-cycles of many consumer products and parts, focusing
instead on internal controls and operational efficiencies. However, Sony offers a local “take
back,” recycling program for consumers, allowing customers to recycle Sony goods at locations
across the U.S., free of charge (ww.sony.net). Panasonic does not currently have a comparable
program in place; however implementation of a similar program presents a great opportunity for
Panasonic to further local efforts of sustainability.
Emphasis on internal processes has produced highly regulated supply chain management systems
as Sony. Sony’s “Green Partner” quality approval program mandates requirements for
outsourcing of component parts, and established guidelines relating to material procurement are
outlined in Sony’s code of conduct. At Panasonic, “green” policies for supply chain
management are less regulated as much of Panasonic’s manufacturing in conducted in-house
(Guide for Greener Electronics 18, 2012). A summary of differences between the companies
can be found in Table 7 below.
Panasonic vs. Sony Environmental Practices
21
Table 7: Differences of Environmental Initiatives
Differences
Panasonic
Sony
Corporate
Environmental
Strategy Forecast
8 year plan with targets
40 year plan with 5 year targets re-evaluated
annually
Third Party
Monitoring of
Environmental
Efforts
No third party verification or inspection
of environmental standards
Global Environmental Management System
31 business divisions and sites in North
America that are ISO certified and third party
inspected on a yearly basis to ensure recycling
and environmental management standards
Greenhouse Gas
Emission Reduction
Targets
No proportional target reduction
Currently at 23% absolute reduction
since 2006 but no details referring to
total percent reduction, targets aimed at
120 million tons reduction by 2018
Reduce emissions 30% by 2015
Met target with 32% reduction in 2011
through increased energy efficiency and use of
renewable energy
Clean Electricity
Plan
Not specified
Uses 10% renewable energy
Waste Recycling Rate
98.9% - 2012
90% - 2011
Product life
Investment and innovation in increasing
life of products as well as long-standing
warranties and replacements on parts
Does not provide details on innovations for
extending product life or length of product
warranties
Hazardous Materials
No commitment to eliminate BFRs or
PVC
Phased out use of BFRs and PVC as of March
2012
Supply Chain
Management
Majority of manufacturing conducted
in-house
“Green Partners”
A quality approval program for Sony suppliers
that must meet Supplier Code of Conduct and
management regulations for procurement of
environment related substances
Local Recycling
Program
No policy in place
“Take Back” program offers free recycling
locations for consumers
Government
Regulations
Panama
U.S.
Organization
Centro de Incidencia Ambiental (CIAM)
Environmental Protection Agency (EPA)
Emissions Standards
No local government regulation
Pollution Regulation
General Law of the Environment
Regulated by National Environment
Authority (NAM) provides basic
principles for environmental regulation
National Ambient Air Quality Standards
Regulated by the EPA under the Clean Air Act
sets standards for automobiles and factories
releasing pollutants into the air
Pollution Prevention Act
Mandates on the treatment and disposal of
waste and chemicals along with the Resource
Conservation and Recovery Act
These results in environmental management and impact are important because they reinforce the
need for accountability among corporations. Without government restrictions or national
standards, business contributions to economic development are dependent on corporate social
responsibility and ethical codes. Preservation of natural habitats and efforts to improve the
Panasonic vs. Sony Environmental Practices
22
quality of life both locally and through reduced pollution efforts are critical in shrinking
environmental impact. Transparency in business processes is necessary to assure performance
levels and stated efforts are upheld.
5 – SUMMARY
A contrast of environmental initiatives and corporate social responsibility between Panasonic
Panama and the Sony Corporation of America, illustrates the varying degree of investment and
focus in reducing a company’s environmental footprint. Contingent on local population
awareness, regional ecosystem complexities, and national government regulations, company
activities must be tailored to country specific regions to maximize overall environmental efforts.
Information for this study was collected through extensive online research and while a face-toface interview with Panasonic Panama was scheduled, due to late cancellation this option of data
collection was not available. The online portion of research was conducted using reputable
search engines and keywords detailed in Tables 1 and 2. Through the data collection process
eco-plans for each company were presented in detail, with a focus on local community activism.
Panasonic Panama and Sony Corporation of America are both multi-billion international
consumer electronics companies. Panasonic, located east of the Panama Canal and in operation
since 1970, works locally to promote sustainability through educational volunteer efforts and
sponsorship programs. Sony, located on the United States west coast and in operation since
1970, focuses on local programs to restore ecosystems and regional habitats.
Results from the project case study demonstrate recent steps taken by both companies to reduce
environmental impact as well as future targets for continued progress. While both companies
laid out an environmental corporate strategy, the emphasis of each varied along with
implementation and monitoring processes. Similarities between the companies included a highly
engaged employee population participating in local community events for environmental
awareness as well as volunteer hours for beach clean-up and tree planting. Each company
provided funding locally to varying organizations for development of educational facilities and
preservation of regional biodiversity. Main differences between the two companies were
transparency of information on reporting environmental targets and impact, as well as internal
monitoring to ensure processes were executed in accordance with company standards. Panasonic
focuses on lifetime product environmental impact, looking to promote sustainability through
consumer and business usage of products, while Sony focuses on operational and supply chain
processes to promote sustainability through internal company actions.
The impacts of the results from the case study illustrate varied enforcement of government
regulations and presence of environmental laws between countries. American companies are
closely-monitored for environmental protection as well as development and process restrictions
to limit environmental impact. Panamanian companies are developing into a more defined
environmental groundwork for environmental regulation. These findings are beneficial to
support the development of regional environmental laws specific to protecting local habitats and
ecosystems, as well as the need for third party enforcement and monitoring of business actions.
Panasonic vs. Sony Environmental Practices
23
Successful processes employed by each company can be used to complement existing
environmental strategies in place for companies expanding globally. Dependent on local
environmental concerns and current company opportunities, Panasonic and Sony external and
internal processes highlight successful systems for reducing a company’s overall environmental
footprint.
Overall company management of environmental initiatives and current environmental impact for
each company is detailed in Appendix A at the end of this paper. Greenhouse gases, water
usage, waste management and chemical handling are all listed for between company
comparisons.
Some additional work could be done to include resources being threatened in each region due to
air, water and waste pollution, as well as a closer look at government policies and corruption in
each country to test the accuracy of company reporting and level of enforcement of
environmental laws.
Panasonic vs. Sony Environmental Practices
24
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Panasonic vs. Sony Environmental Practices
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APPENDIX A
Figure 7: Sony Overall Environmental Impact
Sony.net
Panasonic vs. Sony Environmental Practices
27
Figure 8: Panasonic Overall Environmental Impact
Panasonic.com