The Body Shop: Social Responsibility or Sustained Greenwashing?

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Case Details:

Case Code : BECG067
Case Length : 25 Pages
Period : 2002-2006
Organization : The Body Shop International Plc.
Pub Date : 2006
Teaching Note : Available
Countries : UK, Europe, USA
Industry : Beauty care / Cosmetics

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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A Controversial Makeover Contd...

On the other hand, L'Oreal was viewed by activists as the face of modern consumerism - a company that tested its cosmetics on animals, exploited the sexuality of women, and sold their products by making women feel insecure. Moreover, Nestlé owned 26 percent of L'Oreal. Nestle was one of the most boycotted companies in the world for its alleged unethical business practices and aggressive promotion of baby milk in developing countries.

Body Shop's critics said that they felt betrayed by the deal as Roddick had previously been quite vocal in her criticism of companies like L'Oreal. They called for a boycott of Body Shop's products as they felt that the company had sold out its values and principles.

Body Shop and Roddick defended the deal by saying that L'Oreal would not compromise Body Shop's ethics and that the merger would give Body Shop a chance to spread its values to L'Oreal. L'Oreal also announced that Body Shop's values would not be compromised and that it would continue to operate as an independent unit.

Many analysts were concerned that Body Shop's image would be affected by the acquisition. Some activists felt that Body Shop would not be able to function independently and that an important partner in CSR had been lost. However, they were a few who felt that Body Shop's values would rub in on L'Oreal and believed that the deal had some positives.

There were also questions raised about whether L'Oreal was trying to improve its image and buy CSR through this deal. But for Body Shop's staunchest critics, the acquisition by L'Oreal was vindication of their view that Body Shop was nothing more than a greenwasher.

Background Note

In 1970, Roddick (then Anita Perella) and Gordon Roddick (Gordon) were inspired to set up a beauty products store after seeing a store called 'The Body Shop' in Berkeley, California, USA, that sold cosmetics like shampoos, lotions, body creams, etc. The California store was run by two entrepreneurs, Jane Saunders and Peggy Short, who sold cosmetics on the 'care for the environment' plank...

Excerpts >>


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