1

CORPORATE SOCIAL RESPONSIBILITY REPORT ON

PFIZER PHARMACUETICAL
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Executive summary

Pfizer is an American based one of the top pharmaceutical companies across the world
that is renowned for its struggles and tiresome efforts to safe humanity from fatal diseases
and life threatening ailments. The product line of Pfizer comprises of famous and most
demanded medicines that are considered as an integral part of elevating life expectancy
ratio. This report is written to focus on the corporate social responsibility efforts made by
this pharma giant and to view that how this company play its role in paying back to the
society it serves and from where it earns huge revenues.

Besides taking a glance at the CSR policies of Pfizer, this report will also focus on the
previous challenges faced by this company that are directly related to its CSR repute and
how well Pfizer had responded to them and maintained its society friendly image.
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Contents
Executive summary ................................................................................................................. 2

PART 1: ..................................................................................................................................... 5

Introduction and Research Framework .................................................................................. 5

Rationale of Research Topic and Selection of this Organization ......................................... 6

Research Objectives .............................................................................................................. 7

Research Questions ............................................................................................................... 8

Research Design .................................................................................................................... 9

PART 2: ....................................................................................................................................11

Research Methodology...........................................................................................................11

Research Data Collection Method .........................................................................................11

Primary data collection .......................................................................................................11

Secondary Data Collection .................................................................................................11

Research Limitations .............................................................................................................12

Ethical Consideration.............................................................................................................12

CSR Theories and Models ......................................................................................................13

Corporate Social Responsibility .............................................................................................13

Practicing Corporate Social Responsibility ............................................................................15

CSR Models .............................................................................................................................16

Carroll’s CSR Pyramid ...........................................................................................................16

Economic ....................................................................................................................19

Legal ...........................................................................................................................19

Ethical .........................................................................................................................19
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Philanthropic Practices ...............................................................................................20

Importance of Carroll’s CSR Pyramid ....................................................................................20

CSR Model for Stakeholders- Mendelow’s Matrix.................................................................20

Friedman’s Theory of CSR .....................................................................................................23

PART 3: ....................................................................................................................................25

Evaluation of Pfizer Pharma CSR ..........................................................................................25

Carroll’s Model of CSR at Pfizer Pharma ...............................................................................25

3.1. Economic Analysis .........................................................................................................25

3.1.2. Pfizer Social Responsibility related to Environment .....................................................29

3.1.3. Supply Chain Environmental Sustainability Goals ........................................................31

3.1.4. CSR and Customers of Pfizer ......................................................................................32

3.1.5. CSR to Employees ......................................................................................................36

3.1.6. Philanthropic Services by Pfizer...................................................................................36

3.2. Response to CSR Scandals Faced by Pfizer ..................................................................37

3.3. Supply Chain Problem Faced by Pfizer ..........................................................................38

PART 4 .....................................................................................................................................41

4. Conclusion and Recommendations...................................................................................41

4.1. Recommendations ......................................................................................................42

APPENDICES...........................................................................................................................44
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PART 1:

Introduction and Research Framework

Since the intervention of social movements in mid of 1950s, a new concept of corporate
social responsibility arose among the chief executive and owners of business empires. In
the mid of 20th century, it was revealed that any business is not conducted just for the
sake of its owner’s personal financial accounts elevation, rather a sense of responsibility
and accountability started spreading its roots in the society. Business owners and people
from the corporate sector realized that every business is accountable to its clients, stake
holders, even employees and the community they are serving. According to (Willems,
2016), a code of business ethics was developed and every business entity was enforced
to abide by the rules and regulations of these business ethics. According to the business
dictionary Corporate Social Responsibility can be defined as “accepting of a concept that
each and every company has to integrate certain social and environmental concerns in
every business activity they perform and in their interaction with community, employees
and stake holders”. As per (Bjørneseth, 2017), CSR is a direct source of bringing
competitive advantage to the business and elevating the reputation of any organization
in market.

Pfizer is an American based, one of the largest pharmaceutical company of the world.
This company deals in life saving drugs and capture a bigger share in the pharma industry
across the globe. The commonly used medications manufactured by Pfizer are Celebrex,
Listerine and Viagra. Due to its high revenue generation, Pfizer is highly attractive to
investors across the world. Being one of the leading pharma company, Pfizer keeps
special care of its CSR policies and thinks beyond its own profits and sustainability.
(BREWER, 2014), explained that Pfizer is well aware of the fact that as a community
health conscious company, they owe a lot to their society from where it earns huge profit.
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That is why this pharma company focus more on the CSR policies and how to repay to
its people and stake holders.

This thesis is written to highlight the importance of CSR in the pharmaceutical business
in large and for Pfizer pharma in general and will elaborate that how Pfizer pharma tries
to delight its stake holders, employees, clients and shareholders while pin pointing all the
places where Pfizer seems lacked behind in giving back to its society through a weaker
CSR policy.

Rationale of Research Topic and Selection of this Organization

The research topic ‘Corporate social responsibility’, was selected because of the day to
day growing importance of CSR in almost every field of business. People are much aware
of the fact that the target or future goal of any business should not only be generation of
profit and success does not only relates to organizational performance rather the way any
business is giving back to the society it serves and the social responsibility it should pay
is more important to judge anyone’s success. CSR has very broader meanings which
demands that the CSR policies of any organization should be made in order to assure
societal benefit of people and encouraging philanthropic practices with in the
organization. CSR in the pharmaceutical companies demands that pharma companies
should try to provide a system change in the society and should facilitate in uplifting the
health and living standards of the deprived ones through their effective CSR policies.
Everyone in this universe has the right to live a better life and this can only be achieved

if every organization collaborate to deliver high standard of health and well-being through
their business activities. Pharmaceutical companies stand on the top rank among those
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who has a capability to enhance the living standards of society because their main product
is directly related to life saving components. As depicted by (Hayley Droppert, 2015),
Pharma companies can contribute with Government sector and NGO’s in providing a
‘decent minimum’ of medicines for those that are deprived from the basic right of better
health.

I have selected Pfizer pharmaceutical company to cover the corporate social

responsibility subject because Pfizer has been trying to maintain its repute related to pay
back to its society and in whole life span of Pfizer, it has faced many challenges in paying
off its social responsibility to society. Pfizer has gone through lot of changes in the
previous few decades with significant consolidation and arising scrutiny related to the
manufacture of life saving medicines. Recently Pfizer has faced some controversies
regarding its pain killer Celebrex that raised a question at its CSR policies. This research
will focus on the strengths and weaker area of Pfizer CSR and will conclude that why
Pfizer has lagged behind to fulfill its CSR.

This research will elaborate the CSR models approached by Pfizer in their daily practices
and how this company incorporate CSR policies to repair its poked reputation and assure
people that they have adapted improved CSR strategies in order to reverse people’s
beliefs about their unethical practices as a pharma company.

Research Objectives
The purpose of conducting this research is to deeply analyze the importance of corporate
social responsibility as per Pfizer pharmaceutical and analyze it critically that how this
pharma business icon practices its CSR policies and what are the drawbacks in its CSR
policies that needed to be revised or altered so that Pfizer can contribute more to society.
Moreover, how Pfizer’s CSR policies leave a deep impact on their business and its keen
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stakeholders. The basic objectives to conduct this research can be elaborated as

mentioned below;

 To keep an eye on the competitive advantage attained through practicing CSR

policies and their consequences in the long run
 To deeply analyze the major CSR models implemented in general working of Pfizer
 How a weak crafted CSR policy does diversely impacted the key stakeholders of
Pfizer?
 To focus on the most beneficial CSR models and evaluate their effects on the
overall performance of Pfizer.
 To what extent stakeholders are involved in Pfizer’s CSR initiatives?
 To indicate the areas where Pfizer lagged behind in its CSR approach and how it
can improve its policies
 To highlight Pfizer’s strategies to respond to the challenges it faces due to its CSR
policies

Research Questions
In order to critically analyze the research objectives, the following questions should be
answered;

1- How CSR models give a better understanding about the practical application of
CSR at Pfizer?
2- How CSR models applied by Pfizer can help in concluding the efficacy of its CSR
practices?
3- How Pfizer’s failure to prove itself as a better social responsible company affected
its stakeholders?
4- What strategies can be adapted to improvise the CSR policies at Pfizer?
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5- How well Pfizer responded against the CSR failure it faced in previous years?

Research Design

research
Topic

Theoretical RESEARCH Data

Framework Collection
DESIGN

Research
Questions

The research methods or criteria are divided into two categories known as the qualitative
research and quantitative research. Even sometimes combination of both can be used
which is known as mixed methodology. In the qualitative research no numeric evaluation
of data has been done while in the context of quantitative research there is a numeric
evaluation incorporates (Deepak and Behrdwaj, 2017). However, this study is
incorporated with the qualitative research method where secondary data has been used
to collect all relevant information. It is very important to focus on the study criterion or
design of our research in order to get done with the study evaluation in operative and
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efficient manner. Survey strategy is one best procedure which helps in information
investigation in powerful and reasonable way.

It is one of useful asset which encourages scientist so as to gather the information. There
are number of ways centered to gather the information by methods for study. Some of
such ways are the versatile review, Google study, Paper study and by methods for some
other online overviews, for example, monkey study technique, etc. Hence, it is the
principle reason that analyst has centers around the review look into methodology. It gives
the powerful approaches to complete the information gathering. Notwithstanding, the
general fittingness of the exploration results depends on the precision and credibility of
information gathered from reviews of survey

Our research design comprises of a simple approach where initially a theoretical

framework will be formulated by making some key research questions that cover all the
queries related to implementing a better CSR policy. As it is a qualitative research so the
source of data will only be secondary and primary comprising of previous reports, books,
literature available on internet and that can give to the point and precise answers to all
our research.
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PART 2:

Research Methodology

Research Data Collection Method

The research data compilation methods consists of two basic types known as the
secondary data and primary data collection method. The both proceses have own
importance and significance. Therefore, it is required to keep in mind that how we will
collect the data.

Primary data collection

In the context of the primary research method the data compilation should be done by
means of questionnaire, interviews and observations. Primary data is characterized as
gathering data straightforwardly. It can either be in type of meetings or the surveys. In this
investigation semi-organized meeting is most ideal approach to examine. The same
number of inquiries ought to be asked in meetings identified with corporate execution and
the general goal of the investigation. But as mentioned before that this research is
qualitative one so we need not to perform all these activities personally rather this report
relies more upon secondary data collection.

Secondary Data Collection

Secondary data has been gathered by means of the books, articles, and academic
journals (Graford, Shah, and Rashid,, 2017). Secondary data for information
accumulation are the place wellspring of data is gathered. Region of such sources are
Internet, libraries, magazines. This technique is to be done on the grounds that it’s
12

impractical to make inquiries in meetings and furthermore there is a restricted measure

of data while taking meetings

However, to collect the most relevant and accurate data, Pfizer pharma company record
has been accessed through internet sources that was available in the form of annual
reports, books, industry reviews and publications in the form of academic journal articles.

Research Limitations
Some of the limitation to research is enlisted as follows;

 The research may be flawed because primary data has not been approached
 The research results might fluctuate because of the limited time to complete the
research
 There was lack of publically available information related to Pfizer pharma CSR
failure or policies
 Moreover, going through all the available stuff regarding Pfizer Pharma and their
CSR strategy and analyze the credibility of all available stuff was quite difficult in
this short period of time.
 Data gathering become difficult because of copy right issue and no easy access
to relevant data.

Ethical Consideration
The ethical consideration is an integral element to be concentrated during the tenure of
research. In the context of the ethical parameters, it is to assure that the work on the
research has been started with the approval of supervisors. In addition to this, the data
has been be collected by approaching the secondary sources including academic articles,
research paper, and empirical evidence. Moreover, it is to assure that none of the data
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has been be copied and all the working is properly cited with relevant and authentic
sources. The done work has been not being hitting any personal integrity and all the work
is free of abducted material. Furthermore, the provided works are free of plagiarized work.

CSR Theories and Models

Corporate Social Responsibility

It is depicted in the study of Li, Zang, Shen (2016), as a concept where firm considers the
society interest by looking for the accountability for the influence of their action on
employees, and all connected people like stakeholders, and most considerably on the
environment. However, there has no single and prosper definition of the Corporate Social
Responsibilities exists but still it is evolving and business is approaching CSR to achieve
the competitive edge. CSR has always seen as the most valuable concept. It has
redefined by the organizations as per the need of society and business. CRS is
considered as the balancing act where the focus of organization fixed on cultivating the
line between social responsibility and sustainability. Furthermore, it is noted that CSR is
an approach prevailing to contribute a better society and conveying the shared values to
the key stakeholders.
It is indicated in the study of Freire, Mecerreyes, & Marrucho, (2015), Corporate Social
Responsibilities embraced the two major concepts known as transparency and
accountability. In the era of the modernized world, stakeholders are demanding them from
the organization to deliver their best output in the non-financial activities such as the
human rights, environmental ethics, business ethics, corporate supremacy, workplace
issues, a growth of society and corporate donations. It is hereby clear that the
organizations have been recognizing the requirement of the Corporate Social
Responsibilities because of showing it great dependency on achieving the organizational
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goals and objectives and sustaining the competitive edge. It means that the success of
the organizations is now somehow based on the relationship with the customers and how
they have been dealing with social issues and responsibilities. In addition to this, the role
of marketers is highly influential in creating Corporate Social Responsibilities and letting
organizations formulate their superior image in the domain of the hyper-competitive
industry. However, for this concern, nations are implementing the practices of Corporate
Social Marketing in order to deliver support to behavioral change implementation and
development. The intention behind doing so is to improve the environment, safety, public
health, and community well-being.
It is cited in the study of Aaronson (2002), the organization has maintained keen focus on
the business activities and engagement with the Corporate Social Responsibilities in
order to seek the prosper and effective business results this will eventually help
organizations in order to seek the competitive edge in the highly modernized and
globalized working arena. It is further analyzed that Corporate Social Responsibility has
been approachable by almost all level organizations in order to maintain significant
positions against their competitors within the industry.
It is also noted, business should focus on the compelling factors in order to promote the
causes of the Corporate Social Responsibility and how it influence on the organizational
productivity and sustaining the competitive edge. Though, those factors are a sustainable
project, community relation project, sponsorship, strategic philanthropy, consciousness
raising, sled-regulation initiatives, economic development program, safety concerns, and
quality improvements programs.
According to (Linda O’Riordan, 2006), CSR is a concept that relates to the organizational
process which often is determined as the process of corporate social responsiveness.
CSR is elaborated as a concept where the focus of firms is to consider society interest by
seeking authorities to make society better and seek a competitive edge in the globalized
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business environment. Hence, there are wide varieties of sources that had been
reshaping the competitive landscape and helping organizations in achieving a competitive
edge. Modern enterprises are not putting considerable concern on the nation’s society,
politics, and ethics. In addition, the developing nation keeps high concern on Corporate
Social Responsibility which eventually helps the organization to grow and developed
against competitors.

Practicing Corporate Social Responsibility

CSR has been redefined by the agencies as a need of society and business. CRS is
considered as the balancing acts wherein the focal point of business enterprise is on
cultivating the road between social obligation and sustainability. Furthermore, it is referred
that CSR is a technique winning to make contributions to a better society and conveying
the shared values to the key stakeholders.
It is indicated inside the study of Berjining (2016); Corporate Social Responsibilities
embraced the two primary principles known as transparency and duty. In the generation
of modernized global, stakeholders are annoying the from the business enterprise to
brought their satisfactory output in the non-financial activities which includes the human
rights, environmental ethics, enterprise ethics, company supremacy, place of work
troubles, an increase of social and corporate donations. As far as pharmaceutical
companies are concerned, CSR has become a factor that can never be ignored because
these companies are directly connected to the health and well-being of humanity.
As depicted by (Ma, 2012), it is hereby clear that the pharma companies have been
recognizing the requirement of the Corporate Social Responsibilities because of
displaying its exceptional dependency on reaching the organizational desires and targets
and sustaining the competitive side. It manner that fulfillment of the companies is now
somehow based on the connection with the customers and how they have been handling
the social problems and responsibilities.
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It is analyzed that Corporate Social Responsibility has been approachable by nearly all
level corporations so that you can keep the giant positions against their competition in the
industry. It is also stated, the commercial enterprise should attention at the compelling
elements so that it will sell the reasons of the Corporate Social Responsibility and the way
it influences at the organizational productivity and maintaining the competitive area.
Though, those factors are a sustainable project, network relation project, sponsorship,
strategic philanthropy, attention growing, sled-law tasks, economic development
program, safety issues, and first-class improvements packages.

CSR Models
Though the moral benefits of implementing CSR strategies are unlimited and everyone is
aware of the importance of these CSR strategies but keeping an eye on the four basic
models of CSR, it really becomes difficult for the companies to make a decision that which
CSR framework will be the best for them and how they can attain competitive advantage
out of it for their business. Here we are going to discuss the three basic models of CSR
and will briefly elaborate their importance and effectiveness in providing competitive
advantage to the pharmaceutical companies. Let’s have a glance.

Three Basic CSR Models

1- Carroll’s CSR Pyramid

2- Mendelow’s Matrix for CSR
3- Friedman’s Theory of CSR

Carroll’s CSR Pyramid

As per (Carroll, 2016), Carroll’s pyramid is the simplest approach towards attaining a CSR
plan as it describes that why it is important for any organization to meet their social
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responsibility. The significant features of any organization’s CSR policies are illustrated
below;

 Profit of any organization must be kept at the first place as CSR stands on the
pillars of any company’s revenues and profits
 Abiding the legal and ethical laws and regulations
 Ethical duties comes in the first place and once they are fulfilled, a company should
move towards its philanthropic activities.
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As mentioned in the above figure that there are four basic responsibilities that should be
covered in the CSR policy of any organization. These are as mentioned below;

I. Philanthropic
II. Ethical
III. Legal
IV. Economic
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 Economic
If a company needs to serve its community well and want to work for their
prosperity, it should arrange for its business growth and profitability. Only a
revenue generating firm can heal the scars and wounds of its deprived society.
The economic responsibilities of any company will demand that the company
should perform to avail maximum profits, operational growth and provide chances
to save wealth. A company is declared responsible to provide professional growth
chances to its employees and job security so that they can work with peace of
mind. Economic responsibility also comprises of manufacturing the best quality
product and supplying it at the very right time when there is high demand in market.
Confirming customer’s satisfaction also lies under economic responsibility.
Availability of timely dividends and profit share to the shareholders is another
economic obligation to attain a better CSR strategy.

 Legal
All the legal and ethical laws and regulations associated with the regular practices
of a pharma organization should be obeyed first. These laws may include labor
laws, compensation, health and safety, community well-being etc. This kind of
responsibility comes after providing economic assurance to the company clients
and stakeholders. According to recent studies, legal responsibilities fulfillment
provide a sense of security to the ultimate stakeholders of any business.

 Ethical
For a pharmaceutical company like Pfizer, abiding by the corporate laws related to
business ethics should certainly be kept as first priority. Any company should not
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indulge itself in any such practices that directly or indirectly harm the life or well-
being of its clients or stakeholders. A business should never violate the code of
ethics that has been crafted by the company laws. Ethical values may differ from
business to business and depend upon the social norms and beliefs of that society
in which they are serving. Compliance by the ethical standards of any company
decides the extent to which any business stake holders can trust their company.

 Philanthropic Practices
The responsibility of any company to pay back to the society it has been serving
is regarded as philanthropic practices. Though the nature of this responsibility is
discretionary but still it is considered as one of the pillars of obtaining better CSR
reputation. Few examples of philanthropic responsibility are charity and donations
for the well –being of employees and deprived citizens of society. One thing should
be kept in mind that if any company fails to fulfill its legal and ethical
responsibilities, all the philanthropic practices conducted by the company will be in
vain. So, to proof its self as a philanthropic company, any business has to abide
by all the legal and ethical rules decided by that company.

Importance of Carroll’s CSR Pyramid

This model of CSR is the simplest one to adapt and understand which put much emphasis
on organizational profits and sustainability. The only drawback of this model is that some
companies do argue at the hierarchy of responsibility ranking in this model and argue that
ethics should be kept at the top of very other responsibility.

CSR Model for Stakeholders- Mendelow’s Matrix

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Mendelow’s matrix is a basis of formulating such CSFR policy where stakeholders are
focused as the most important entity of any business. This CSR tool is used to evaluate
the attitudes and concerns of stakeholders and how do they utilize their powers in
affecting the CSR practices of any business. Through this CSR model, a business can
maintain balance between the conflicting preferences of its stakeholders.

(Dizzle, 2018), Mendelow’s Matrix for CSR consists of four boxes approach to represent
its stakeholders. Let us have a look at the basic constituents of these four boxes.

The four boxes of Mendelow’s Matrix represent the following;

 Box A represents the key players who are regarded as the high interest and high
power group and for any business goodwill, this group should be kept highly
engaged with the company’s activities. At this level, the stakeholders may be the
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actual drivers behind the formulation of any CSR strategy and have a heavy
influence upon the continuity of any strategy.

 High interest and low power group is the one that always show immense interest
in the working and strategies of any company but are least interested in influencing
the working of that company. Need of the day is that, these stakeholders should
be kept informed about each and every change that goes with in the organization
while staying at comfort that these box owners will never affect the strategies of
the company in their better interest. Key stakeholders and shareholders are kept
as a perfect example of this box A group.

 Low Interest and High Power group is the one that have all the powers to enter
the high interest group with their power to impact the strategies of that company
but are not much interested in doing so. These kind of stakeholders should be kept
satisfied about the working and strategies of the company because through this
approach they will never try to interfere in the functions of the company. These are
the Box B stakeholders that comprises of customers of that organization. Political
and governmental elite are taken in this Box C.

 Low interest and Low Power group are the ones that hold no powers to alter the
workings and strategies of their company so that is why they are least interested
in changing the work methodology of their company. They companies also
sometimes neglect about informing these group of stakeholders about the changes
made in the CSR strategies of the company and take them for granted. General
public is the best example of this group members.
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Friedman’s Theory of CSR

According to (Barlas, 2016), Milton Friedman’s model pf CSR is completely different from
the theories and models given by other scholars. According to Friedman, business are
bound to perform only one corporate social responsibility and that is to utilize its resources
24

wisely just in order to generate maximum profit for its shareholders but there should be
no deception of fraud involved in the whole procedure. So, we can say that businesses
have to concentrate only on the profit generation activities and should play a fair game
because through more profit, they can pay back to their shareholders to whom they are
answerable.

Friedman contributed that the private sector business owners should only indulge in
exercising fair business dealings and maximizing their profits which is an indirect way to
pay their social responsibility by stabilizing the economy of the community they serve.
According to Friedman providing financial growth to the business is a direct source to give
tribute to social responsibility because only a successful business can serve its society in
the following ways;

 Stabilizing the economy and maintaining balanced prices for consumers

 Providing more job opportunities to those in need (Friedman, M. (1970)
 Creating an ethical and economical balance for the stakeholder, clients, and the
public sector.

Friedman’s theory of CSR is considered quite paradoxical by other scholars because

he declared that paying corporate social benefit is not the responsibility of the private
sector and it should be the public sector that should pay this social responsibility. As
declared by Nielsen Survey. (2012), in today’s world when private and public sector
are collaborating in every field of life, it is not feasible to deny the importance of CSR
for the private sector. Public and private both sectors play a crucial role in regulating
the performance and future goals of each other so CSR should be considered an
integral part for both sector’s success.
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PART 3:

Evaluation of Pfizer Pharma CSR

Pfizer works under the vision, “working together for a healthier world” which requires
performing of each and every business activity in an ethical way and keeping patient’s
well-being as the first priority by fulfilling their needs. Corporate social responsibility
programs at Pfizer are formulated to confirm the understanding of the evolving needs of
the society and contribute their share in assuring the wellness of the world.

Pfizer issues an annual report regarding its social responsibility in order to confirm that
the company is playing a fair game in supporting and implementing CSR throughout the
company. After thorough analysis of the CSR practices at Pfizer, we came to know that
this pharma industry giant relies much upon the Mendelow’s Matrix model of CSR.

Carroll’s Model of CSR at Pfizer Pharma

3.1. Economic Analysis

The CSR policies related to economic analysis of Pfizer can be seen by analyzing its
annual revenue and financial reports for the first quarter of 2109.

According to recent survey, the first quarter of 2019 shows a dynamic increase in the
annual growth of Pfizer which is approximately 5% in the very first quarter. This leads
Pfizer to generate an annual revenue of $13.1 Billion. Further analysis has revealed that
the raise in annual growth was brought to occur by 7% contribution from the Biopharma
groups while 1% operational growth was made due to Upjohn.

The following figure gives a thorough look at the 2019 first quarter’s results related to
Pfizer’s adjusted diluted EPS.
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Revenues $52.0 to $54.0 billion

Adjusted Cost of Sales(2) as a Percentage of
20.8% to 21.8%
Revenues
Adjusted SI&A Expenses(2) $13.5 to $14.5 billion
Adjusted R&D Expenses(2) $7.8 to $8.3 billion
Approximately $200 million of income
Adjusted Other (Income)/Deductions(2) (previously approximately $100 million of
income)
Effective Tax Rate on Adjusted Income(2) Approximately 16.0%
$2.83 to $2.93
Adjusted Diluted EPS(2)
(previously $2.82 to $2.92)
(Pfizer, 2019),

As described by Carroll’s model of CSR, revenue generation is the key to obtain

competitive advantage at organizational level and to pay back to society in the form of
employment opportunities, better compensation and handsome market share.

Capital Allocation at Pfizer

As per (Pfizer, 2019), the first quarter of 2019, Pfizer gave a return of $10.9 Billion to its
stakeholders in the form of $2.0 billion dividends, $8.9 billion of share sales were $2.1
billion are share repurchase in open market.
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(Pfizer, 2019)

3.1.1. Stakeholder’s Engagement at Pfizer

Pfizer operate under the stakeholder model of Mendelow’s because it has realized the
interconnection of stakeholder’s with the achievement of its future goals.
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CUSTOMERS/
PATIENTS

HEALTHCARE
GOVERNMENT
PARTNERS

GLOBAL HEALTH
AND ECONOMIC
PROSPERITY

COMMUNITY
OFFICE
IN WHICH
COLLEGUES
SERVING

INVESTORS
AND BUSINESS
PARTNERS

The above figure gives a glance of all kind of stakeholders that are connected with Pfizer
and are highly associated with every performance made by this pharma company.

How Pfizer Addresses its Stakeholders?

As depicted by (Peter Einstein, 2012), Pfizer performs the following responsibilities in

order to satisfy its stakeholders and keeps their satisfaction at the top of the list of their
CER policy;

 Analyzing customer’s needs

 Introducing life- saving drugs like Prevnar 13, Xalkori
 Maximizing its profits
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 Allocating financial resources effectively so that maximum output can be generated

out of them
 Assuring a cut down on operating expenses in order to confirm consumer friendly
prices of its medications.

Relationship with Stakeholders

 Providing regular feedback about company’s performance ( (Makower, 2006)

 Assure a close connection of central management with the employees
 Arranging a medium to communicate between stakeholders and management.

3.1.2. Pfizer Social Responsibility related to Environment

(Pfizer, 2018),

As per (Ghogre, 2015), the basic CSR approach towards safety and security of
environment was to reduce the impact of Pfizer medicines and operations on the
environment. For this purpose Pfizer has made every arrangement to reduce their GHG
emission that has a drastic effect on the environmental pollution. Therefore, Pfizer has
made every effort to minimize the effect of GHG emission through developing strategic
30

approach to assure environmental sustainability. It also involved its stakeholders to

contribute their experience in developing healthcare reforms.

According to a research the green house emission at Pfizer were 1.8% higher as
compared to 2017 and the next CSR strategy for environment is to decrease it by 20% till
2020.

EMMISION
YEAR PERCENTAGE
2012 2.15
2015 1.92
2016 1.76
2017 1.67
2018 1.7

Waste Material Disposing

As described by (Files, 2018), daily waste leftover from any pharma company is
something that is contributing more to the environmental pollution. As an environmental
friendly company, Pfizer pharma considers it’s their social responsibility to dispose of
practically its thousands metric tons hazardous and non-hazardous waste. According to
an estimate the waste disposed of in 2018 was 3% lower than in 2017 and now company
has made a target of decreasing it by 15% till 2020.
31

(Pfizer, 2018)

3.1.3. Supply Chain Environmental Sustainability Goals

During 2015, Pfizer developed a comprehensive supply chain goal achievement policy in
order to bring meaningful and positive changes in the global environment. The basic goals
of Pfizer related to supply chain sustainability till 2020 are mentioned below;

 Elevating its key suppliers to 100% who can understand and collaborate Pfizer’s
supplier code of conduct and can oblige by the principles set by the global
pharmaceutical company’s initiative
 Preparing 100% of its key suppliers to maintain greenhouse emissions and
knowledge of waste management and appropriate use of water
 Assuring reduction goals for 90% of its key suppliers so that a clean and green
atmosphere can be maintained.
32

(Pfizer, 2018),

3.1.4. CSR and Customers of Pfizer

According to (Pfizer, 2018), Customers or patients are the basic entity that can provide
business sustainability to Pfizer if this company succeeds in satisfying their demands and
giving those best health care facilities and medication.
33

Pfizer can attain sustainability through its benchmark strategies to assure provision of
high class medication and introduce effective medicines that can help in providing exact
remedy to incurable ailments. Here’s a glance into the CSR policies at Pfizer related to
satisfy its customer’s needs through following strategies;

 Providing Access to Medicines

34

(Pfizer, 2018),
One of the major drawback of pharmaceutical companies is that although they
manufacture medicine for any specific disease but access to these medicines is
almost impossible for the customers due to certain reasons. Now Pfizer has
arranged global plans and programs to raise the access level in the emerging
markets.
 Launched 285 global level programs across 53 countries to assure availability of
medicines in the markets
 Introduced various life- saving therapies for a maintaining better health care
standards
 Introducing Consumer Friendly Prices
 Worked on 18 out of the 20 fatal diseases that cause disability and threat to life
and represented them in their current product and the ones in pipeline.
35

 Assisted approximately 2.5 million patients to get access to 31 million medications.

As a part of its social responsibility to community, Pfizer has decided to introduce cost
friendly prices for those who cannot avail high priced medication. That is why Pfizer is
continuously engaged in providing assistance to the needy patients across USA and has
planned to proceed their mission to other countries across the world. According to a
survey, Pfizer provided medical assistance to about 250,000 patients to receive 1.8
million in lieu of financial assistance to its community.

Special medical insurance programs have been arranged to help the derived one across
USA.
36

3.1.5. CSR to Employees

As stated by (Pfizer, n.d.), Employees are always the primary stakeholders for any
organization and the CSR policies of any company demands that its employees should
be kept satisfied during their tenure of job. Pfizer pharm works on the stakeholder model
for CSR where it makes every effort to entertain its primary stakeholders through
providing those better chances of jobs, handsome pay rates and providing an
environmental friendly workplace.

As depicted by (Pfizer, 2018), from 2006 to 2018, the total number of employees at Pfizer
92.400 across the globe where the highest number of employees was recorded in 2009
that ranges to 117 thousand employees. Pfizer has been practicing ethical code of
business that demands special care and assuring well –being of its personnel. Pfizer is
relying on centralized decision making process in order to create a friendly atmosphere
between the employees and higher authorities of the company. Moreover, Pfizer also
arranges for prior training sessions for its employees so that they can get open opportunity
of professional growth.

3.1.6. Philanthropic Services by Pfizer

As per (Pfizer, 2010), Pfizer highly rely on philanthropic services to contribute as one of
the best corporate social responsible pharma company. Charity campaigns and
philanthropic services practiced by Pfizer can be viewed in the following mentioned list;

 Pfizer foundation donated $2.75 million in the form of cash for the sufferers of
disaster and misery
 Issued 2200 generators to those employees in Puerto Rico who were victim of
Hurricane Maria
 Made access to cancer treatment easy and affordable to the citizens of sub-
Saharan Africa
37

 Pfizer RxPathways distributed 1.8 million prescriptions free of cost to help 250,000
patients
 Exceeded the medicine donation by 700 million which was an antibiotic used to
treat trachoma.

There is no end to the philanthropic services offered by Pfizer in order to prove itself as a
corporate social responsible company.

3.2. Response to CSR Scandals Faced by Pfizer

Being a pharma company, when it comes to social responsibility, the major focus of Pfizer
pharma is on the quality of medicines it manufactures and their expected outcomes.
Though being one of the best pharma company across the world, Pfizer always keeps
thorough monitor on its supply chain management and quality of products but in 2006,
this company faced a crucial scenario when one of its drug started showing drastic results
for human health. The CEO at Pfizer stated that this drug was supposed to be a life-
saving great drug for the generation but unfortunately it faced immense failure.

As claimed by (Herper, 2006), besides this, due to the failure of drug, Pfizer becomes a
center of focus for people and they started raising questions against the marketing
practices and high process of Pfizer’s medicines. The company was under intense stress
due to a wave of complete rejection from the society and analytics.

The failed drug was “Torcetrapib”, which was supposed to be the best medication for
cardiac arrest and strokes due to high HDL levels. But further research on Torcetrapib
and another cholesterol lowering drug Lipitor combination proved to be fatal as 82
patients who were treated with this so called remarkable combination died after taking
this medication. While the rest who were just using Lipitor alone survived with better
results. As a sudden reaction to criticize it faced from public and stakeholders, Pfizer
38

announced to revoke the production of this drug on immediate basis but still it faced
intense reaction from the food and drug administration who declared that Pfizer informed
about the alarming situation much later it actually happened. This scenario was a real
trauma for Pfizer as it lost a great percentage of patient who previously trusted Pfizer as
their life saving partner. 2010 was the year when Pfizer experienced a decline in the sales
of its top selling drug Lipitor.

3.3. Supply Chain Problem Faced by Pfizer

(Fry, 2018), reported that in the beginning of 2018, Pfizer faced a great problem related
to its drug supply which arose a question about the medicine supply system of this
company. Reports have claimed that in last February 2018, the major hospitals faced a
remarkable shortage in the supply of ‘Bupivacaine’ which is used as local anesthetic
during baby delivery. The shortage of this drug persisted for almost three months and
developed an argument among the people from medical sciences background about the
reputation of Pfizer as a pharma company that failed to oblige by its social responsibilities.
Though Pfizer also failed to supply some more drugs timely but none of the incident was
of such a huge magnitude as of Bupivacaine one. This lacking in supply of drug at prior
time left a mark on the reputation of Pfizer CSR strategy.

3.3.1. How Pfizer Responded to its CSR Challenges?

According to (Pfizer, 2017), though the shortage in supply of life saving medication is
unfathomable in medical history of any advanced and developed country but through
effective CSR strategies for future made Pfizer to stand out again with its previous positive
repute. Let us have a glance at the immediate course of action taken into account by
Pfizer;
39

 As depicted by (Ana Adi, 2015), Pfizer introduced an advanced and improvised

supply chain management strategy where the whole route of medicine was
monitored by the supply chain department of the company

 (Banker, 2018) described that Elevating its key suppliers to 100% who can
understand and collaborate Pfizer’s supplier code of conduct and can oblige by the
principles set by the global pharmaceutical company’s initiative

 Pfizer arranges for a digital supply chain framework by implementing latest

technology in order to confirm timely supply of medicine to the exact place and at
ultimate time. to make timely supply possible Pfizer invested in buying middleware
transportation from GT Nexus that would be used to deal with the medicine careers

 Pfizer has invested high budget in updating its R&D department so that each and
every medicine manufactured at Pfizer should undergo prior research before being
40

launched into the market. Moreover, Pfizer is collaborating with different

universities, research labs and other pharma companies in introducing innovative
medication. All these actions are planned so that the previous negative impact on
Pfizer due to the harmful results of its products can be overcome by producing
highly effective life- saving drugs.
41

PART 4
4. Conclusion and Recommendations

CRS is considered as the balancing act where the focus of organization is fixed on
cultivating the line between social responsibility and sustainability. Corporate Social
Responsibilities embraced the two major concepts known as transparency and
accountability. The intention behind CSR is to improve the environment, safety, public
health, and community well-being. In addition to this, CSR is elaborated as a continuous
process or an on-going dedication by agencies a good way to behave ethically and display
the proper contribution to seek sustainability. However keeping this in mind, the role of
marketers is highly influential in creating Corporate Social Responsibilities and letting
organizations formulate their superior image in the domain of the hyper-competitive
industry. Hence, CSR is elaborated as a concept where the focus of firms is to consider
society interest by seeking authorities to influence on the communities, shareholders,
stakeholders, customers, suppliers, and environment.

For any pharmaceutical company like Pfizer pharma, CSR is a consistent procedure or
an on-going responsibility by organizations so as to carry on morally. The point of CSR is
to contribute morally to make social orders capable and monetarily created. CSR is an
idea that identifies with the authoritative procedure which regularly decided as the
procedure of corporate social responsiveness. There are various sources that were
reshaping aggressive scene at the worldwide parameters where the most vital patterns
depend on the developing consideration of the corporate social duty.
42

As per (Pfizer, 2017), Pfizer, being one of the most renowned pharmaceutical company
across the world is continuously making efforts to maintain its high repute among the
pharma world by keeping much care of its corporate social responsibilities and want to
erase any negative incidents related to their operations that might have occurred in past.
With a highly efficient supply chain management system, Pfizer is always standing with
the nation in safeguarding them against any life threatening diseases. Pfizer is also
popular because of its environmental friendly efforts in eradication of wastes from the
premises of their factories and country where they serve.

4.1. Recommendations
It is advised to the corporate responsibility managers to strategically outline the activities
of CSR. These activities needs to be linked with the objectives of the organization and
must compile with the vision and mission statement. Hence it is essential to focus
because without the proper alignment between goals and CSR activities competitive
advantage cannot be sustained. It means that responsibility of managers deliberately
based on to layout the activities of CSR, moreover, they should keep on monitoring the
operations of R&D, supply chain, procurement and HR department to check if their
working is going according to the CSR policies. These activities should be connected with
the goals of the association and must gather with the vision and statement of purpose.

As per (Jamie Snider, 2003), It is also recommend focusing of Corporate Social

Responsibility Programs by articulating the relevant philosophies of CSR into the guiding
principles of the organization, making sure that the higher official must look into the matter
of Corporate Social Responsibility Programs, and also incorporates CSR programs into
the long-term strategic planning of the organization. It is highly influential to focus to
implement and encourage the Corporate Social Responsibility Programs in the
association to gain the competitive advantage.
43

It is also suggested to focus on the core initiative and value of the Corporate Social
Responsibility perspective within the organization. It is due to many reason including, it
helps organization in achieving their goals, helps in creating values for the customers, let
organization to grow an developed, helps in sustaining competitive advantages, and
portray effective contribution in the economic development of the prior nations. The
manufacturing and research laboratories should be enforced to work under strict quality
control standards.

Pfizer should activate the research and survey department of their company so that
detailed market surveys should be conducted which will facilitate the manufacturing
department regarding the manufacture of medicines that are more in demand and might
face a run short in near future.

Pfizer should collaborate with the world organization of research to associate them in
experimenting on new medicines and launching them through their company.

The marketing department should also be made well aware of the buying behavior of
target customers and organizing programs to develop health awareness among general
public so that along with getting a knowhow about the upcoming health threatening
diseases they should also get acquaintance with the quality medicines of Pfizer.

Arranging conferences and seminars with the famous physicians regarding health issues
and their cure so that Pfizer can maintain its positive repute as a health friendly
pharmaceutical company. Hence, in this aspect an organization will going to reap benefits
of sustaining competitive advantage by focusing keen concern on the Corporate Social
Responsibility and its related activities (Concepción, 2018).
44

APPENDICES

APPENDIX 1:

APPENDIX 2:
45

APPENDIX 3:

Revenues $52.0 to $54.0 billion

Adjusted Cost of Sales(2) as a Percentage of
20.8% to 21.8%
Revenues
Adjusted SI&A Expenses(2) $13.5 to $14.5 billion
Adjusted R&D Expenses(2) $7.8 to $8.3 billion
Approximately $200 million of income
Adjusted Other (Income)/Deductions(2) (previously approximately $100 million of
income)
46

Effective Tax Rate on Adjusted Income(2) Approximately 16.0%

$2.83 to $2.93
Adjusted Diluted EPS(2)
(previously $2.82 to $2.92)

APPENDIX 4:
47