Procter & Gamble

From Wikipedia, the free encyclopedia

Jump to navigationJump to search
"P&G" redirects here. For other uses, see PG.
‹ The template Infobox company is being considered for merging. ›

The Procter & Gamble Company

Procter & Gamble headquarters in downtown Cincinnati, Ohio

Type Public

 NYSE: PG
Traded as
 DJIA Component
 S&P 100 Component
 S&P 500 Component
 Industry Consumer goods

Founded October 31, 1837; 181 years ago

Cincinnati, Ohio, U.S.

Founders  William Procter

 James Gamble

Headquarters Cincinnati, Ohio

,
U.S.

Area served Worldwide (except Cuba and North Korea)

Key people David S. Taylor(Chairman, President &

CEO)[1]
Jon Moeller (CFO)

Products Cleaning agents

Personal care products
Beauty Care Products
Personal Healthcare Products
Diagnostics (through SPD Joint Venture)

Brands See list of brands

Revenue US$67.684 billion[2] (2019)

Operating income US$5.487 billion[2] (2019)

Net income US$3.897 billion[2] (2019)

Total assets US$115.1 billion[2] (2019)

Total equity US$47.58 billion[2] (2019)

Number of 97,000[2] (2019)

employees

Website pg.com

The Procter & Gamble Company (P&G) is an American multinational consumer

goods corporation headquartered in downtown Cincinnati, Ohio, founded in 1837 by English
American William Procter and Irish American James Gamble.[3] It specializes in a wide range of
personal health/consumer health, and personal care and hygiene products; these products are
organized into several segments including Beauty; Grooming; Health Care; Fabric & Home Care;
and Baby, Feminine, & Family Care. Before the sale of Pringles to Kellogg's, its product portfolio
also included foods, snacks, and beverages.[4] P&G is incorporated in Ohio.[5]
In 2014, P&G recorded $83.1 billion in sales. On August 1, 2014, P&G announced it was
streamlining the company, dropping and selling off around 100 brands from its product portfolio in
 order to focus on the remaining 65 brands,[6] which produced 95% of the company's profits. A. G.
Lafley—the company's chairman, president, and CEO until October 31, 2015—said the future P&G
would be "a much simpler, much less complex company of leading brands that's easier to manage
and operate".[7]
David Taylor is the current president and CEO of Procter & Gamble.

Contents

 1History
o 1.1Origins
o 1.2International expansion
o 1.3Further developments
o 1.4Restructuring
 2Finances
 3Operations
o 3.1Management and staff
o 3.2Employer recognition
o 3.3Brands
o 3.4Radio and television production
o 3.5Sponsorships
 4Controversies
o 4.1Price fixing
o 4.2Toxic shock syndrome and tampons
o 4.3Child labor and forced labor
o 4.4Animal testing
o 4.5Other products
o 4.6Logo myth
o 4.7"The Talk"
o 4.8Gillette ad
 5Corporate diversity
 6CEO-to-worker pay ratio
 7References
 8Further reading
 9External links

History[edit]
Origins[edit]
Candlemaker William Procter, born in England, and soapmaker James Gamble, born in Ireland, both
emigrated from the United Kingdom. They settled in Cincinnati initially and met when they married
sisters Olivia and Elizabeth Norris.[8] Alexander Norris, their father-in-law, persuaded them to become
business partners, and in 1837 Procter & Gamble was created.
In 1858–1859, sales reached $1 million. By that point, about 80 employees worked for Procter &
Gamble. During the American Civil War, the company won contracts to supply the Union Army with
soap and candles. In addition to the increased profits experienced during the war, the military
contracts introduced soldiers from all over the country to Procter & Gamble's products.
In the 1880s, Procter & Gamble began to market a new product, an inexpensive soap that floated in
water. The company called the soap Ivory. William Arnett Procter, William Procter's grandson, began
a profit-sharing program for the company's workforce in 1887. By giving the workers a stake in the
company, he correctly assumed that they would be less likely to go on strike.
The company began to build factories in other locations in the United States because the demand
for products had outgrown the capacity of the Cincinnati facilities. The company's leaders began to
diversify its products, as well, and in 1911, began producing Crisco, a shortening made of vegetable
oils rather than animal fats. As radio became more popular in the 1920s and 1930s, the company
sponsored a number of radio programs.
International expansion[edit]
The company moved into other countries, both in terms of manufacturing and product sales,
becoming an international corporation with its 1930 acquisition of the Thomas Hedley Co., based
in Newcastle upon Tyne, England. After this acquisition, Procter & Gamble had their UK
Headquarters at 'Hedley House' in Newcastle upon Tyne, until quite recently. Numerous new
products and brand names were introduced over time, and Procter & Gamble began branching out
into new areas. The company introduced Tide laundry detergent in 1946 and Prell shampoo in 1947.
In 1955, Procter & Gamble began selling the first toothpaste to contain fluoride, known as Crest.
Branching out once again in 1957, the company purchased Charmin paper mills and began
manufacturing toilet paper and other tissue paper products. Once again focusing on laundry, Procter
& Gamble began making Downy fabric softener in 1960 and Bounce fabric softener sheets in 1972.[9]
One of the most revolutionary products to come out on the market was the company's
disposable Pampers diaper, first test-marketed in 1961, the same year Procter & Gamble came out
with Head & Shoulders.[10] Prior to this point, disposable diapers were not popular, although Johnson
& Johnson had developed a product called Chux. Babies always wore cloth diapers, which were
leaky and labor-intensive to wash. Pampers provided a convenient alternative, albeit at the
environmental cost of more waste requiring landfilling. Amid the recent concerns parents have
voiced on the ingredients in diapers, Pampers launched Pampers Pure collection in 2018, which is a
"natural" diaper alternative.[11]
Further developments[edit]
Procter & Gamble acquired a number of other companies that diversified its product line and
significantly increased profits. These acquisitions included Folgers Coffee, Norwich Eaton
Pharmaceuticals (the makers of Pepto-Bismol), Richardson-Vicks, Noxell (Noxzema), Shulton's Old
Spice, Max Factor, the Iams Company, and Pantene, among others. In 1994, the company made
headlines for big losses resulting from levered positions in interest rate derivatives, and
subsequently sued Bankers Trust for fraud; this placed their management in the unusual position of
testifying in court that they had entered into transactions that they were not capable of
understanding. In 1996, P&G again made headlines when the Food and Drug
Administration approved a new product developed by the company, Olestra. Also known by its brand
name 'Olean', Olestra is a lower-calorie substitute for fat in cooking potato chips and other snacks.
In January 2005, P&G announced the acquisition of Gillette, forming the largest consumer goods
company and placing Unilever into second place.[12] This added brands such as Gillette
razors, Duracell, Braun, and Oral-B to their stable. The acquisition was approved by the European
Union and the Federal Trade Commission, with conditions to a spinoff of certain overlapping brands.
P&G agreed to sell its SpinBrush battery-operated electric toothbrush business to Church &
Dwight,[13] and Gillette's Rembrandt toothpaste line to Johnson &
Johnson.[14] The deodorant brands Right Guard, Soft and Dri, and Dry Idea were sold to Dial
Corporation.[15] The companies officially merged on October 1, 2005. Liquid Paper and Gillette's
stationery division, Paper Mate, were sold to Newell Rubbermaid. In 2008, P&G branched into the
record business with its sponsorship of Tag Records, as an endorsement for TAG Body Spray.[16]
P&G's dominance in many categories of consumer products makes its brand management decisions
worthy of study.[17] For example, P&G's corporate strategists must account for the likelihood of one of
their products cannibalizing the sales of another.[18]
On August 25, 2009, the Ireland-based pharmaceutical company Warner Chilcott announced they
had bought P&G's prescription-drug business for $3.1 billion.[19]
P&G exited the food business in 2012 when it sold its Pringles snack food business to Kellogg's for
$2.75 billion after the $2.35 billion deal with former suitor Diamond Foods fell short.[20] The company
had previously sold Jif peanut butter, Crisco shortening and oils, and Folgers coffee in separate
transactions to Smucker's.
In April 2014, the company sold its Iams pet food business in all markets excluding Europe to Mars,
Inc. for $2.9 billion.[21] It sold the European Iams business to Spectrum Brands in December 2014.[22]
Restructuring[edit]
In August 2014, P&G announced it was streamlining the company, dropping around 100 brands and
concentrating on the remaining 65, which were producing 95% of the company's profits.[6]
In March 2015, the company announced it was selling its Vicks VapoSteam U.S. liquid inhalant
business to Helen of Troy, part of a brand-restructuring operation. This deal was the first health-
related divestiture under the brand-restructuring operation.[23]
In July 2015, the company announced the sale of 43 of its beauty brands to Coty, a beauty-product
manufacturer, in a US$13 billion deal. It cited sluggish growth of its beauty division as the reason for
the divestiture.[24][25][26] The sale was completed on October 3, 2016.[27]
In February 2016, P&G completed the transfer of Duracell to Berkshire Hathaway through an
exchange of shares.[28]
In April 2018, Reuters reported that Procter & Gamble would purchase the consumer health division
of Merck Group (known as EMD Serono in North America) for €3.4 billion euros (£2.96 billion; $3.9
billion).[29]
In November 2018, P&G unveiled a simpler corporate structure with six business units that will be
effective from July 2019[30]

Finances[edit]
For the fiscal year 2018, Procter & Gamble reported earnings of US$9.750 billion, with an annual
revenue of US$66.832 billion, an increase of 2.7% over the previous fiscal cycle. Procter & Gamble's
Shares traded at over $86 per share in 2017, and its market capitalization was valued at over
US$221.5 billion in October 2018.[31] Procter & Gamble ranked No. 42 on the 2018 Fortune 500 list of
the largest United States corporations by total revenue.

Revenue Net income Total Assets

Year Employees
in mil. USD$ in mil. USD$ in mil. USD$

2005 56,741 6,923 61,527

2006 68,222 8,684 135,695

2007 74,832 10,340 138,014

2008 79,257 12,075 143,992

2009 76,694 13,436 134,833

2010 77,567 12,517 128,172

2011 81,104 11,564 138,354

2012 82,006 10,500 132,244

2013 80,116 11,068 139,263 121,000

2014 74,401 11,390 144,266 118,000

2015 70,749 6,777 129,495 110,000

2016 65,299 10,508 127,136 105,000

2017 65,058 15,326 120,406 95,000

2018 66,832 9,750 118,310 92,000

Operations[edit]
As of July 1, 2016, the company structure has been categorized into ten categories and six selling
and market organizations.

 Categories
o Baby Care
o Fabric Care
o Family Care
o Feminine Care
 o Grooming
o Hair Care
o Home Care
o Oral Care
o Personal Health Care
o Skin & Personal Care
 Selling & Market Organizations
o Asia Pacific
o Europe
o Greater China
o India, the Middle East, and Africa (IMEA)
o Latin America
o North America
Management and staff[edit]
The board of directors of Procter & Gamble currently has 11 members.[32]

 Frank Blake
 Angela Braly
 Amy L. Chang
 Scott Cook
 Joseph Jimenez
 Terry J. Lundgren
 W. James McNerney, Jr.
 Nelson Peltz
 David S. Taylor
 Meg Whitman
 Patricia A. Woertz
In May 2011, Fortune editor-at-large Patricia Sellers praised P&G's board diversity, as five of the
company's 11 current directors are female and have all been on Fortune's annual Most Powerful
Women list.[33]
In March 2011, Rajat Gupta resigned from the board after a SEC accusation of Galleon
Group insider trading.[34]
In May 2013, Robert A. McDonald announced his retirement and was replaced by A.G. Lafley, who
returned as chairman, president, and CEO.[35]
Procter & Gamble is a member of the U.S. Global Leadership Coalition, a Washington, DC-based
coalition of over 400 major companies and NGOs that advocates for a larger international affairs
budget, which funds American diplomatic and development efforts abroad.[36]
Employer recognition[edit]
Fortune magazine awarded P&G a top spot on its list of "Global Top Companies for Leaders", and
ranked the company at 15th place of the "World's Most Admired Companies" list.[37] Chief
Executive magazine named P&G the best overall company for leadership development in its list of
the "40 Best Companies for Leaders".
In October 2008, P&G was named one of "Canada's Top 100 Employers" by Mediacorp Canada Inc.
and was featured in Maclean's newsmagazine. Later that month, P&G was also named one
of Greater Toronto's Top Employers, which was announced by the Toronto Star newspaper.[38]
In October 2013, the company was named the fourth-most in-demand employer in the world
according to analytic data sourced by Linkedin.[39]
In August 2013, P&G was named the 14th-hardest company to interview for by Glassdoor.[40] In
November 2013, Glassdoor also named them as a top 25 company for career opportunities.[41] In
February 2014, Glassdoor placed P&G 34th on their annual Best Places to Work list.[42]
In November 2014, P&G came out publicly in support of same-sex marriage in a statement made by
William Gipson, P&G's chief global diversity officer.[43]
In November 2015, P&G was named the Careers in Africa Employer of Choice 2015 following a
survey of over 13,000 African professionals from across the globe. P&G was also recognised as the
most desirable FMCG business to work for in Africa.[44]
In 2016 and 2017, P&G was recognized as one of Forbes World's Most Reputable Companies.[45][46]