International executive MBA program

Module X 3BS313A Investment Decision Making

doc. Ing. Miroslav Špaček, Ph.D., MBA

Corporate Social Responsibility and Shared Value Initiatives

CHEIZER ARANTES ROMEIRO

Prague, October 2018

Contents
Natura: Ethic, Sustainability and Social Responsibility..................................................................3
Company Overview.....................................................................................................................3
Causes and Commitments............................................................................................................3
Value Chain..................................................................................................................................4
Conception and Development of Products...............................................................................4
Supply of Raw Material...........................................................................................................4
Transformation and Production................................................................................................5
Relationship Sales....................................................................................................................5
Brand Experience.....................................................................................................................5
Start by Accenture: competency training for the digital economy..................................................6
Company Overview.....................................................................................................................6
The Opportunity...........................................................................................................................6
The Strategy.................................................................................................................................7
The Results...................................................................................................................................7
Natura: Ethic, Sustainability and Social
Responsibility
Company Overview
Natura is a Brazilian company in the sector of
treatment products for face, body, soap, beard,
deodorants, body oils, makeup, perfumery, hair,
sun protection, and children. Today it is present
in Brazil, Argentina, Chile, Colombia, Mexico,
Peru, Venezuela, France and the United States,
as well as 63 other countries indirectly. The
number of employees, called in the company of
"collaborator", reached 7,000 in 2013 and the
number of consultants estimated at 1.5 million.
In 2016, it acquired for an undisclosed amount the purchase of Emeis Holdings Pty Ltd, owner of
the Australian cosmetics network Aēsop. In 2017, it purchased L'Oréal's The Body Shop for
around € 1 billion, significantly increasing its international presence and global turnover.
Natura is today the largest Brazilian cosmetics multinational and started its history in 1969, when
Luiz Seabra inaugurated a small store at Oscar Freire Street in São Paulo. In 1974, the company
stopped offering its products in stores and began to sell them in the direct sales model. Its
founder has always believed in building a business with the mission of providing the well-being-
well, harmonious relationships of the individual with himself, with others and with nature. Since
our foundation, we have believed in the potential of relationships and the power of cosmetics as
an enhancer of consciousness.

Causes and Commitments

Natura believes that through its business it is possible to transform the society and the planet. An
exuberant, vivid and health Amazon forest is their priority, also clean air and a good public
education. In this sense, Natura is committed to a certain way of doing business which make its
values to stand out. It produces vegetable-based formulas that offer care for the customers and
the planet. The company focus on sustainable packaging that is beautiful and produces less
waste, additionally it does not test its products in animals. Also, the respect for human rights and
environmental laws is a big concern. In summary, what guides Natura business is its relationship
with people and the planet.
Value Chain
Positive impact: Natura takes care of everything from the raw material to the disposal of
products. Generating positive social and environmental impacts is the goal of taking care of the
entire value chain. Reconciling business, environmental, social and human objectives, from the
extraction of raw materials - which will give rise to cosmetics - to the discarding of packaging
after use by the consumer, is the objective in everyday life at Natura. The enlarged view of the
entire value chain (name given to all these stages) allows the company to act on different fronts
to generate positive impact in society and in the world.
Conception and Development of Products
Prioritizing plant ingredients is the way to touch the activity in an innovative way with
renewable resources. In 2017, about 84% of the raw materials of the formulas already had this
origin.
The use of packaging made from renewable and / or post-consumer recycled materials is another
initiative of this front. To create actions in this area, Natura is part of an open and global
innovation network, including partnerships with international organizations. In 2017, R $ 172
million (2.2% of our net revenue) was invested in innovation.
Supply of Raw Material
Through the Amazon Program - created in 2011 - Natura promoted the generation of sustainable
businesses in the region. From 2010 to 2017, it accumulated more than R $ 1.2 billion in
turnover in the area.
The company buys raw materials to produce its products from 34 local communities and
encourages productive techniques that have already contributed to the conservation of 257,000
hectares of standing forest and, consequently, for the reduction of deforestation, one of the main
responsible for the emissions of greenhouse gases in Brazil.
Transformation and Production
Natura is a "Carbon Neutral" company throughout its value chain. The result was possible thanks
to the mobilization of efforts from 2007, when the Neutral Carbon Natura Program was created,
focused on the reduction and compensation of greenhouse gases.
Generating positive impact on employees is also an objective of this front. By 2017, 30% of the
company's leadership positions were held by women. Of all the professional staff, 6.1% were
people with disabilities. Achieving, by 2020, 50% of women in management positions and 8% of
people with disabilities are two ambitions of the company.

Relationship Sales
Natura Beauty Consultants are the driving force behind its business and total 1.7 million in Latin
America (according to data from the 2017 Annual Report). Improving the average income and
quality of life of this group is part of this relationship sales initiative.
Through a plan to increase the generation of wealth for the Consultants, it was possible that they
would earn 17% more in 2017. In the same year, the company also created the Education
Benefit, which consists of partnerships with higher education institutions and languages, among
others, to offer discounts and allow Beauty Consultants and family to return to study.

Brand Experience
Stimulating conscious consumption is one of the initiatives contemplated here. Therefore, Natura
shows in its e-commerce the positive impact that each product generates in society and on the
planet. When buying a Kaiak fragrance, for example, the consumer learns, among other things,
that the product is made with organic alcohol, carbon neutral and is not tested on animals.
The purpose of this positive impact inventory is to engage the people who consume our products
on issues relevant to the common good and uphold healthy values and practices.The positive
experience with the brand closes the virtuous circle - through which we seek to operate - and its
efficient functioning takes the company back to the Amazon, in order to expand its relationship
with local communities, generating more wealth and preserving the forest in foot.
Start by Accenture: competency training for the
digital economy
Company Overview
Accenture is a global leading
company in the Consulting,
Technology and Outsourcing
industries. Accenture addresses
its clients' most challenging
challenges by delivering
unmatched business strategy,
consulting, digital, technology
and operations services. We
serve more than three-quarters
of the Fortune Global 500
companies, providing
innovation to enhance the way the world lives and works. With expertise in more than 40
industries and overall corporate functions, we deliver transforming results for a demanding new
digital world.
Speaking of the Outsourcing branch which the company refer as Accenture Operations, this
business unit combines technology that scans and automates business processes, delivers useful
insights, and delivers “Everything-as-a-Service” with our team's expertise. With this, the
customer can confidently chart their target for their core business services on demand, accelerate
innovation and speed to market.

The Opportunity
Business Process Outsourcing (aka by the acronym BPO) practice started about 20 years and it is
now on its 4th generation. This type of business emerged along with the internet development
which made possible the remote and instant connection of physical production facilities and
offices across the Globe. At the same time, technology adoption sharply increased productivity
for the companies based in the developed countries and boosted salaries, hence increased costs
over time. Outsourcing ordinary Backoffice processes then began to be considered. The first two
generations of outsourcing business were focused on labor arbitrage that basically consists in
workforce offshoring which is the transfer of operational and standardized tasks from high-cost
labor country to cheaper ones. However, after many years this approach gives signs of
exhaustion due to two main factors: the difference in labor costs from one country to another
decreased in such a way which narrowed the possibilities of significant gains from this practice
and also, the Digital Era created new industries with a new demand profile, hence, a new skill set
is expected from the workforce wherever they are based.
In summary, outsourcing companies as Accenture have to deal with a lack of qualified
professionals to tackle those two business challenges. In order to address that, Accenture has
identified that its operations in developing countries could take advantage of non-desirable
economic-social index such as high-unemployment rate and at the same time create a positive
social impact in the society that surround it.

The Strategy
In 2014, Accenture in Brazil started the Start project, which aims to prepare young people in
situations of social and economic vulnerability with the necessary skills to be included in the
digital economy. The program has been transforming the reality of young people from regions
where Accenture operates, training them professionally in themes with great contracting
potential in each locality and related to Digital Economy through the strengthening of behavioral
skills such as creativity, collaboration, empathy and self-confidence, in addition to other aspects
related to the knowledge of digital technologies and software and its application to business
processes such as operations in financial services, credit operations and digital marketing, for
example.
The profile of the participants is basically: young people from 18 to 24 years old; high school,
attended in public school; not working formally or attending higher education; family income per
capita of up to 1 minimum wage; 60% of female participants. 180 hours of content are offered
over 3 months in semi-face format, with 50% of face-to-face classes and the other 50% through
an e-learning platform. With training grid and format adhering to the latest education trends, the
program is divided into 3 large blocks, the first two common to all students and the third specific
by location. The use of a digital platform connects young people to the trends of continuous
learning, based on the skills of the future through dynamic and flexible contents, constructive
interactions guaranteeing the amplification of the social impact.

The Results
More than thousand young people have already gone through the project and by the end of 2018
should reach twelve hundred. Six-hundred plus have already been employed, with more than
four-hundred and twenty of them at Accenture. The young people hired through the program, on
average, have HALF of turnover in relation to peers. More than a thousand hours of volunteering
through mentoring, lectures and youth visits to our offices. The program has already received
internal (Innovation Awards) and external awards (Spanish Chamber of Sustainability).