Estee Lauder Companies
Ethical Strategy Analysis
Analysis of the Ethical Strategy of the Estee Lauder Companies
I. Background Information
A. Brief History
B. Other Relevant Information (Industry, environment, etc)
II. Analysis of the Ethical Strategy
A. Stated Ethical Strategy
1. Philosophy section of the mission statement
2. Explicit statements about ethics and social responsibility 3. Codes of ethics
4. Other information
B. Corporation and its Major Stakeholders
C. Institutionalization of Ethics
1. Explicit Components
2. Implicit Components
D. Corporate Environmental Management
1. Environmental Policy
2. Environmental Management Systems
E. Crisis Management Policy
III. Overall Evaluations and Conclusions
Estee Lauder, who believed that every woman could be beautiful, founded the Estee Lauder Company in 1946 with her husband Joseph Lauder. The Company opened its first department store account with Saks Fifth Avenue in New York City. The company initially launched with four products: Super Rich All Purpose Crème, Crème Pack, Cleansing Oil, and Skin Lotion. Eventually five other brands would be internally developed. Aramis, a line of prestige fragrance and grooming products for men, was launched in 1964. Clinique, the first dermatological, allergy-tested, fragrance-free cosmetics brand, emerged in 1968. Prescriptives, a personalized artistry of custom blended makeup, complimentary colorprinting, and personalized skincare regimen, was founded in 1979. Lab Series, Skincare for Men, the authority in men’s skincare, debuted in 1987. Origins, the first department store wellness brand, was introduced in 1990. From 1960 to 1993, Estee Lauder entered new markets in England, Canada, Central America, Australia, France, Germany, Soviet Union, and China deeming it an international brand. By 1985 the Company surpassed $1 billion dollars in sales. The Estee Lauder Companies (ELC) now sell products in over 140 countries and territories under its well-known brands. Apart from its operations, the Estee Lauder Companies conducts research and development to identify shifts in consumer preferences, develop new products, and improve, redesign or reformulate existing products. Being a globally recognized manufacturer of luxury makeup, skincare, fragrances, and hair care products coincides with Estee Lauder’s initial dream; to bring the best to everyone we touch. The values and standards that govern the Estee Lauder Companies today are the same ones that founded the company over 60 years ago. Mrs. Lauder created a culture of quality, style, and unsurpassed customer service that has made The Estee Lauder Companies the global cosmetics leader it is today.
To fully critique any corporation, one should analyze the external factors surrounding that corporation. The three factors that will be analyzed are: the current global economic crisis, decreased demand for luxury items, and the competitive nature of the cosmetics industry.
Economic Crisis and the Beauty Industry
The level of consumer spending is greatly affected by economic conditions. Economic conditions are created from a host of economic factors. These factors include inflation, interest rates, energy costs, global economies, and consumer confidence. One economic factor that has affected many industries is the current global economic crisis. No sector of business, domestically and abroad, has been spared from this turmoil. The Estee Lauder Companies along with its major competitors operate in a globalized economy. The ELC presently generates cashflows from its ongoing operations and accesses global credit markets...