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A Case Study of Panasonic vs. Sony Corporate Social

Responsibility in Environmental Practices Kristin Johnson – [email protected]

0 – ABSTRACT

Panama’s dollar-based economy, developing economic region and strategic location in Latin

America make it an attractive location for businesses looking to grow internationally. The

Panama Canal and the Colon Free Zone mark Panama as the second largest trading port

worldwide and a main trading partner for the United States (Doing Business in Panama, 2012). A

current project aimed at expanding the Panama Canal, is estimated to be completed in 2015, and

will support continued economic growth and encourage business development in upcoming

years. An examination of environmental priorities, enacted regulations and corporate

environmental practices are compared and contrasted with regional Panasonic Panama

headquarters, and the United States’ Sony Corporation of America. Taking into account

different stages of economic growth for each respective country provides insight into degrees of

regulation and regional expectations of sustainability practices. Striving to maintain economic

growth, and establish itself as a strategic business center, Panama must balance environmental

regulatory policies with the need to support an attractive business environment. To obtain

qualified data for each company and country, an extensive internet data collection process was

followed. Information and data were collected from internet and database queries utilizing

reputable government sites and national news sources. This case study explores the differences

in environmental priorities between, Panasonic versus Sony, to provide a framework for

developing dynamic company initiatives to support sustainability as a corporate social

responsibility. A focus on local activities demonstrates company and employee engagement, as

well as varying regional needs, and environmental concerns, for each country. Findings from

this project reveal similarities in operational initiatives related to conserving resources,

promoting sustainability and business process efficiencies. Primary differences involved a

highly-regulated business environment in the U.S. versus Panama, as well as community-specific

programs emphasizing restoration efforts by Sony Co. and educational initiatives by Panasonic.

Impacts of the results from this research are beneficial for developing countries looking to

implement environmental policies and for companies facing pressure to increase environmental

activism. A balanced analysis of strategies employed by each company as well as governmental

restrictions in each country reveal insights into international policy regulation, regional

environmental awareness, and effective company processes for reducing the corporate

environmental footprint.

1 – INTRODUCTION

1.1 Defined Topic of Study

Corporate Social Responsibility (CSR) as defined by the World Business Council is, “the

continuing commitment by businesses to behave ethically and to contribute to economic

Panasonic vs. Sony Environmental Practices 2

development while improving the quality of life of the workforce and their families, as well as of

the local community and society at large” (“Corporate Social Responsibility”, 2003, para. 1).

CSR plays a critical role in a company’s business polices as related to environmental practices.

Corporate environmental responsibility outlines a company’s strategy for reducing its

environmental footprint through energy savings, recycling initiatives, decreased CO2 emissions,

and sustainability. Panama Panasonic and Sony Corporation of America, include corporate

responsibility manifestos in annual review publications as well as part of their online web

content, with varying degrees of environmental initiatives relative to each.

1.2 Overview of United States Business Environment

America’s business environment is renowned for innovation and creativity, as well as an

educated and skilled labor force. The United States claims one of the most advanced and diverse

economies in the world, with a labor force of 153.6 million, stable inflation and generally low

unemployment. Managerial, professional and technical occupations contribute almost 40% to

national GDP, which totaled $15.66 trillion in 2012, the highest in the world (International

Monetary Fund [IMF], 2011). Financing in the U.S. is readily available through multiple forms

of capital investment, making it an attractive location for new businesses. Availability of capital,

as well al heavy investment in research and the accessibility of new technologies, mark the U.S.

as a competitive global rival in the international business landscape (Porter, 2012).

The below graph illustrates U.S. GDP growth, which averaged 2% over the last thirty years, with

a real GDP per capita of $42,633 (IMF, 2012). The 2008 Great Recession brought about a

drastic drop in GDP and a spike in unemployment, illustrated in Graph 1, however, the

implementation of two stimulus bills in late 2008 and early 2009 helped encourage growth. The

last two years have seen improved unemployment rates (see Graph 2) and GDP year over year

increases. Inflation is hovering around 3%, with expectations to decrease to 2% (ten year

average 2.5%) and remain stable over the next few years. Currently, the top financial concern

for the U.S. is a growing budget deficit totaling $16.8 trillion, as of March 2013, which needs to

be addressed for sustained economic growth going forward (IMF, 2012).

Graph 1: U.S. GDP Real & Nominal (1980-2017)

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5,000.00

10,000.00

15,000.00

20,000.00

25,000.00

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D (

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Real GDP

Nominal GDP

International Monetary Fund, World Economic Outlook Database, October 2012


Graph 2: U.S. Unemployment (1980-2017)

1.3 Overview of United States Environmental Practices and Sony CSR

Environmental protection has been a top concern and closely monitored in the U.S. over the past

forty years. Recent bills such as the American Clean Energy and Security Act of 2009, as well

as previous laws including the 1970 Clean Air Act, amended in 1990, and the Clean Water Act

enacted in 1972, have focused much U.S. attention on environmental regulations and business

compliance. Regulation is monitored in part, by the Environmental Protection Agency (EPA), a

federal agency established to write and enforce environmental standards on a national basis. The

EPA oversees and enforces laws related to business activities such as transportation, facilities

management, building construction, and products and packaging, with the authority to issue fines

and sanctions against businesses not adhering to policies. The EPA currently employs over

17,000 full-time personnel to monitor programs and work on EPA initiatives with goals such as

reduced greenhouse gases, elimination of harmful contaminants, reduced water pollutants and

waste reduction, aimed at global environmental and human health protection (McGarity, 2004).

The below graph depicts U.S CO2 emissions by year and per capita. Reduction in emissions

from 2005 on, illustrate concentrated efforts nationwide to decrease environmental pollution.

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25

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International Monetary Fund, World Economic Outlook Database, October 2012

*Emission Database for Global Atmospheric Research (EDGAR), release version 4.2. 2011

Graph 4: U.S. CO2 Emissions Per Capita

(1990-2011)

Graph 3: U.S. CO2 Emissions

(1990-2011)


California has encountered several environmental issues dating back as early as 1947. Cases

involving smog attacks, oil spills and high air toxicity concerns, have led to statewide awareness

of environmental protection and sustainability efforts in California. Shortly after the

establishment of the EPA in 1970, California passed the California Environmental Quality Act to

provide statewide environmental protection of local natural habitats. In accordance with the

statute, any public or private project affecting the local environment must disclose environmental

impacts and provide validation for projects negatively effecting the environment (“California

Wants to Lead America,” 2013). While increasing hurdles in the business industry, this has

allowed California to regulate new project developments in the state and led to environmentally

friendly alternatives to several business proposals.

Increasing awareness and environmental concern led to Sony’s launch of a company-wide

environmental plan, dubbed “Road to Zero” in April of 2010 (www.sony.net). The plan’s

objectives include a forty year incremental corporate environmental strategy, looking to achieve

a zero environmental impact by 2050. The plan is divided into five-year objectives using,

“backcasting methods to set specific mid-term environmental targets” (“Sony Launches Road to

Zero,” 2013, para. 1). Targets are focused on four distinct perspectives: Conserving resources,

curbing climate change, promoting biodiversity, and controlling chemical substances. Attention

is also given to the product life cycle where Sony seeks to develop energy saving technologies,

reduce energy consumption in operations, partner with climate-friendly suppliers, and eliminate

harmful chemical substances. To reinforce its commitment to environmental efforts, Sony

partnered with the U.S. Environmental Protection Agency on July of 2011, pledging to work

only with certified recyclers under the National Strategy for Electronics Stewardship

(www.sony.net). Progress reveals, as of January 2012, Sony “has exceeded its waste

minimization targets across all of its global business sites, achieving a 54% reduction rate in

2010 set against a 40% objective” (Perella, 2012). Future targets include increased use of

renewable energy, further development of energy saving products, and continued reduction of

CO2 and greenhouse gases, with a 2015 target actualization date.

1.4 Overview of Panama Business Environment

Panama’s economy has seen rapid growth in recent years, with the last five years averaging

8.75% yearly increases in GDP (IMF, 2011). The current labor force boasts 1.509 million with

an unemployment rate of 4.4% (see Graph 6). The majority of labor is concentrated in the

service sector with 64.4% of the population working in services, largely provided by

employment at the Panama Canal (The World Factbook, 2009). Fueling growth is the

development of Panama’s infrastructure as an emerging country, specifically a project aimed at

widening the Panama Canal which is expected to be completed in 2015. Despite economic

growth Panama still suffers from massive income inequalities among its population, with 30% of

the country living in poverty. In addition to income distribution, concerns about unstable politics

also increases potential risks in the business environment.

Panama’s logistics industry is its main source of GDP. The canal serves as a worldwide hub for

trading and the presence of the Colon Free Zone mark Panama as a strategic business center.

Recently the U.S. signed a ratified free trade agreement with Panama in October 2011,

increasing U.S. import and export market share in Panama and reinforcing the importance of

Panama as a critical trading partner for the United States. The widening of the canal is bringing

additional business and increased opportunity to the area and is expected to lead to further

economic growth and development in future years (Leach, 2011).


Graph 5: Panama GDP – Real & Nominal (1980-2018)

Graph 6: Panama Unemployment (1980-2018)

1.5 Overview of CSR and Environmental Practices in Panama

Panama’s environmental restrictions and regulations are monitored and enforced through the

governmental agency, Autoridad Nacional del Ambiente (ANAM) (National Environmental

Authority). Primary environmental concerns in Panama involve the preservation of wetlands,

and regulations to monitor water pollution. Existing policies in place include completion of an

Environmental Impact Assessment for business activities and developments as well as the Code

of Mineral Resources intended to protect indigenous areas (“90% of Panamanians,” 2011).

However, despite the presence of general laws, policy enforcement is loosely monitored.

According to a poll by the Barometer of the Americas and Public Opinion in Latin America, nine

out of ten respondents want stronger environmental protection laws, and 45.1% cited corruption

as a major issue with enforcement (“90% of Panmanians,” 2011). Current laws in place, such as

Law 41, enacted in 1998, allow businesses “loop holes” for project approvals for

environmentally damaging activities to get approved (Arosamana, 2010). Panama’s increasing

GDP, economic growth, and the upsurge of business development, has made balancing economic

progress with environmental considerations, increasingly challenging. Graphs 7 and 8 below,

demonstrate growing CO2 emissions, as well as per capita emissions, in Panama which have

almost doubled since 2005. Policy will become increasingly important as Panama’s economy

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Nominal GDP

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International Monetary Fund, World Economic Outlook Database, April 2013

International Monetary Fund, World Economic Outlook Database, April 2013


continues to grow. Figure 1 below illustrates the proportion of CO2 emissions by country for

North America.

Figure 1: CO2 Emissions by Country (2011)

Panama’s existing biodiversity and forested areas necessitate preservation of resources and

monitoring of future developments. Panasonic Panama’s corporate environmental strategy

accounts for these regional needs and centers on seven focus areas: CO2 emissions reduction,

resources, water, chemicals, biodiversity, stakeholder, and regional efforts. Consideration of

environmental impact is evident through Panasonic’s initiatives. Panasonic emphasizes product

efficiency through heavy R&D for product innovations. Investments in product development

have increased product efficiency goals with successful results on targets such as waste

recycling, currently aimed at 99.5% by 2019, comparable with Sony’s initiatives to achieve a

99% rate by 2015. However an external product emphasis has lowered attention on energy

efficiency and resulted in higher CO2 level emissions as opposed to U.S. counterparts. Figure 2

below, provided on Panasonic’s corporate site, details increased companywide emissions before

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Panama - 11,044



Graph 7: Panama CO2 Emissions

(1990-2010) Graph 8: Panama CO2 Emissions Per Capita

(1990-2010)


efforts are realized in 2019 and CO2 levels begin to decrease. A local partnership to support

sustainability efforts was formed on June 18th

, 2008 with Panama’s National Association of

Nature (ANCON). Through this alliance, Panasonic works to support recycling efforts,

reforestation projects, educational lectures and environmental activities to spread awareness

locally (http://www.panasonic.com.pa/about/eco/). Corporate funding and sponsorship focus

locally in Panama, looking to educate children and consumers on eco-preservation and

sustainability efforts, as well as business on innovative “green” products to reduce environmental

impact.

Figure 2: Panasonic Eco Idea Targets

1.6 Report Focus

The focus of this report is a case study of Panasonic vs. Sony corporate social responsibility in

environmental practices. More specifically, this report compares environmental initiatives,

regulations and impact of corporate social responsibility strategies for Sony Corporation of

America and Panasonic Panama.

2 – INFORMATION AND DATA COLLECTION APPROACH

2.1 Data Collection

Data collection for this study was obtained through extensive internet research. A face-to-face

company interview in Panama was scheduled but canceled last minute and attempts to collect

information via email were unsuccessful. Internet sources were leveraged to obtain needed

information on environmental polices relative to each company and within each country.

2.2 Internet Search

Internet research was conducted using Google and USM library search engines. Databases

including, Business Source Complete, LexisNexis Academic, Encyclopedia Britannica,

International Monetary Fund, The World Bank and Harvard Business Review were employed to

uncover fundamental information regarding U.S. and Panama environmental regulations, local

sustainability awareness, and direct targets to measure environmental goals for each company.

Sources used include peer reviewed academic papers, government databases, industry journal

articles, corporate websites and national news archives. Databases and corresponding web

*Panasonic-la.com/eco/ecoideas


addresses for acquired information are detailed in Table 1. Key words used throughout the

information search are included in the supplementary table below.

Table 1: Databases

Database URL Information

World Economic Outlook

Database Imf.org

Country level data > Panama

Country level data > U.S.

Business Monitor

International www.businessmonitor.com U.S. Business Environment

Credo Reference www.credoreference.com Corporate Social Responsibility

Definition

Emission Database for

Global Atmospheric

Research (EDGAR)

http://edgar.jrc.ec.europe.eu CO2 Emissions by Country and

Year

Environmental

Protection Agency www.epa.gov

U.S. Environmental Regulations

and Restrictions

International Network

for Environmental

Compliance and

Enforcement

www.inece.org Panama Environmental

Regulations and Restrictions

Political Risk Services

Group www.PRSgroup.com Panama Country Report

Table 2: Keyword Search

Corporate Social Responsibility

Panama

U.S.

Corporate Environmental Strategy

Environmental Regulations

Environmental Concerns

Environmental Initiatives

Sony Co. of America

Panasonic Panama

2.3 Panama Interview Main Goal

A secondary data collection was intended through direct interviews with Panama business

executives at Panasonic headquarters. The main objective of the interview was to gain an

understanding of what resources Panasonic employs in maintaining environmental compliance

and what additional steps Panasonic is taking to reduce its environmental footprint locally.

However, due to extenuating circumstances and scheduling conflicts, the interview was canceled

last minute and case study findings were based on internet research alone.

2.4 Interview Instrument

After 40 years in operation, Panasonic Latin America became actively involved in environmental

activities with its 2008 agreement with ANCON, supporting educational and environmental

regional projects (http://www.panasonic.com.pa/about/corporate/). Recent regulations and


global initiatives mandated quick implementation of sustainability practices and ongoing efforts

of corporate social responsibility in the public eye. Questions regarding internal processes used

to roll-out the new initiatives, and how Panasonic monitored implementation and plans to

support efforts going forward were meant to be addressed during an on-site meeting. Included

below is a copy of the interview template prepared for the meeting.

Table 3: Panasonic Questionnaire

2.5 Panasonic Interviewee Profile

Unfortunately, the scheduled meeting with executive Mariana Samudio was canceled due to

schedule conflictions so Panasonic company information obtained for this report was gathered

exclusively from internet research.

3 – CASE STUDY

3.1 Panasonic Panama Headquarters Location

Situated just east of the Panama Canal on the South side of Panama, Panasonic Panama

headquarters are located at Panasonic, Via Simon Bolivar, Ave Transistmica, Contigua Al,

Panama City, Panama. Figure 3 below, depicts the Panasonic location within the country.

Figure 3: Panasonic Panama Headquarters

Via Simon Bolivar, Ave Transistmica, Contigua Al, Panama City, Panama

What were/are the main challenges faced in ensuring environmental compliance locally?

What internal instruments are used to monitor environmental impact?

Does Panasonic offer a "take back" consumer recycling program locally?

What are specific steps Panasonic is taking during the next five years to reduce its environmental footprint?

What do you feel will be the hardest challenge in maintaining Panama's ecosystem despite rapid business development?

Are any employee incentives offered to encourage environmental activism locally?

What do you foresee as the biggest environmental hurtle to overcome in upcoming years?

*“Google Maps” 2013


Figure 4: Panasonic Panama Headquarters

3.2 Overview and Characteristics of Panasonic Panama

Originating as “National Panasonic” in 1970 in the Republic of Panama, Panasonic’s first sales

were recorded under the brand name “National,” and served local markets in Latin America.

Early interest in Panama led this Japanese-based, multi-national corporation, to target goals in

becoming the number one consumer electronics brand for Latin America. An aggressive market

expansion was undertaken and soon Panasonic’s operating area expanded to include current

markets of, Colombia, Ecuador, Uruguay, Paraguay, the Caribbean and other regions of Central

America and Brazil (http://www.panasonic.com.pa/about/corporate/history/). Panasonic Panama

serves as the central headquarters hub for all Latin American sales. North and South American

sales for Panasonic represent 12% of the company worldwide total or $9.4 billion (966.5 billion

yen at exchange rate 1USD:102.44JPY), with global sales of $76.9 billion (7,846 billion yen) in

fiscal year ended March 31st, 2012 (Panasonic Corporation Annual Report, 2012). Products

currently offered in Panama range from audio and video electronic equipment to lighting,

communications and appliances. Sales and service focus on both direct to consumer sales as

well as business to business relationships.

3.3 Panasonic Panama Environmental Activities

Panasonic Panama takes an active role in supporting local ecosystem preservation and

encouraging community activism. In addition to a global company-wide program, “Eco Ideas,”

Panasonic also participates in regional events through volunteerism, sponsorship and fundraising.

Recent contributions include “Panasonic Cares – Month of the Oceans,” an employee volunteer

beach clean-up event, which resulted in the collection of 3.134 pounds of plastic waste gathered

and recycled (http://www.panasonic.com.pa/about/eco/). In addition, local contributions to

promote environmental awareness include, the establishment of “El Caucho,” an outdoor

recreation and 390 meter trail, located in the middle of the city, construction of a visual

education center dedicated to improving environmental awareness in the community, and


ongoing ecosystem education materials for children which include an international contest to

compete on the basis of eco conservation ideas. Business initiatives also seek direct impact

through actively planting trees to maintain Panama’s ecology. During 2008, Panasonic’s

“Project Relay Eco Ideas” resulted in over 1,000 trees planted along the Channel.

Continued investment in research and development for eco-friendly advanced products is a main

focus for Panasonic initiatives, while promoting increased sustainability for businesses and

consumers drives much of Panasonic’s local activism. A 2009 convention headed by Panasonic,

featured newly developed organic products available for local review, testing and educational

consumption. Panasonic performed “ecotours” to interested consumers and businesses

describing everyday actions to take in reducing one’s environmental footprint as well as

demonstrations and explanations of Panasonic products currently available to conserve resources

and reduce waste for corporations and consumers.

Figure 7: Panasonic Business and Consumer Eco-product Expo

Panasonic Panama uses a two-prong approach, both consumer-focused and business driven,

consistent with their global green plan concept of “Green Life” innovation and “Green Business”

innovation (Panasonic Sustainability Report, 2012). Active participation locally, ensures

sustainability remains at the forefront of environmental initiatives, and investment in R&D

allows further opportunity for Panasonic to tackle global eco challenges and promote green life

Figure 5: Pansonic Month of the

Oceans

Figure 6: Panasonic Local Education


not only operationally but throughout the life of the product and through consumer and business

use, the below figure outlines Panasonic’s Green Plan strategy for 2018.

Figure 8: Panasonic Green Plan 2018

3.4 Sony Corporation of America Distribution Center Location

Sony Corporation of America’s manufacturing and distribution center is located on the west side

of the United States in San Diego, California, just off major interstate I-15 and twenty miles

north of the city center.

Figure 9: Sony Corporation of America Manufacturing and Distribution Center

16530 Via Esprillo, San Diego, CA 92127

*Panasonic Sustainability Report (2012)

*“Google Maps” 2013


Figure 10: Sony Corporation San Diego Headquarters

3.5 Overview and Characteristics of Sony Corporation of America

Sony is an international Japanese-based consumer and business electronics company, publically

owned and traded on the New York Stock Exchange. Known for early sales success of transistor

radios, Sony products now include a breadth of assortment from CD’s, computers, smartphones,

and TV’s to professional broadcast and video equipment (www.sony.net). Several years of

successfully exporting to the U.S. led Sony to establish offices in New York in 1960 and

increasing demand prompted construction of a California production facility in 1970. The

popularity of Sony’s color TV launched late in the sixties, coupled with growing U.S. market

share called for faster turnaround and streamlined production of products, leading to the current

San Diego production facility and distribution center which boasts 394,000 square feet of

building space, over 1 million square feet of industrial space and 2,500 employees (Brass, 1996).

U.S. Sony sales totaled $10.436 billion (1,064 billion yen at rate of 1USD:102.44JPY) for fiscal

year 2012 and represent 16% of company worldwide sales reported at $66.658 billion (6,800

billion yen) for fiscal year ended March 31st, 2012 (Sony Annual Report, 2012). Sony sales are

comprised of 50% consumer electronics, 30% professional products and 20% component parts to

original equipment manufacturers (www.sony.net).

Figure11: Breaking Ground at the San Diego Development Site in 1970


3.6 Sony Corporation of America Environmental Activities

In addition to Sony’s “Road to Zero” environmental corporate strategy, Sony also contributes to

local communities through its Global Environmental Management System, employee

volunteerism and community activism. Under the Global Environmental Management System,

Sony operates 31 business divisions and sites in North America that are ISO (International

Organization for Standardization) certified and third party inspected on a yearly basis to ensure

recycling and environmental management standards are upheld at Sony manufacturing and non-

manufacturing sites. Locally in California, Sony has partnered with the University of California

Santa Barbara, to provide funding, technology and equipment to students researching

environmental projects and to benefit educational enrichment of the local community on

sustainability issues. Funding to local non-profit events such as “I Love a Clean San Diego,”

“Creek to Bay Cleanup,” “Kid’s Ocean Day,” and “California Coastal Cleanup Day,” support

community activism and encourage company volunteerism. In 2012, a total of 359,000 pounds

of waste were collected from volunteers with 93,000 pounds recycled (www.sony.net). One of

Sony’s largest environmental programs is a nationwide “take-back recycling program.” Through

the “take-back” program, consumers are able to return any Sony product for recycling at no

charge at drop-off locations across the country (www.sony.net).

Sony also sponsors a company-wide Global Volunteer Day, encouraging all employees to

participate in local volunteer activities. Efforts in 2012 included transforming a neglected

schoolyard park in Brooklyn into an interactive outdoor classroom, where Sony volunteers

conducted sustainability workshops for neighborhood kids (www.sony.net). In Los Angeles, tree

planting and neighborhood cleanups are an ongoing commitment for Sony employees.

Figure 12: Sony Global Volunteer Day Figure 13: Sony Beach Clean-Up


Figure 14: Elementary School Volunteer for Mural Painting

A history of environmental issues in California has led to eco-conscious residents and

consumers, encouraging “green” products and sustainability initiatives for businesses. To this

effect, Sony’s local activities focus on rebuilding and restoring through sponsorship, fundraising

and volunteer efforts, as well as an internal focus on reducing supply chain environmental impact

and increasing energy efficiency standards through initiatives and investment.

4 – RESULTS AND RESULTS IMPACT

4.1 Comparison of Panasonic Panama and Sony Corporation of America

Aspects regarding environmental initiatives, targeted environmental goals, community activism

and local impact of corporate processes for Panasonic Panama and Sony Corporation of America

were compared to illustrate similarities and differences between the companies and the varying

degrees of regulation employed by each country. Specific comparisons were drawn between the

company’s operations, product development, and energy usage as well as detailed reviews of

each company’s corporate environmental strategy plan and future targets.

4.2 Similarities between Panasonic Panama and Sony Corporation of America

Recognizing the importance of contributing to a reduced environmental footprint, Panasonic

Panama and Sony Corporation of America are addressing greenhouse gas emissions, control of

waste disposal, and increased energy efficiency as part of corporate environmental strategy as

well as supporting local biodiversity through volunteer efforts and community activism. In an

effort to promote eco-values, both companies have partnered with local organizations to monitor

the impact of company development plans, operational processes and supply chain

improvements across the region. Panama’s Panasonic works closely with the National

Association of Nature to support local development of educational environmental facilities along

with preservation and reforestation of Panama’s natural plant and marine life communities. In

America, a close collaboration between Sony Corporation and the U.S. Environmental Protection

Agency proves advantageous for ensuring increased green energy usage. Through the EPA’s

Green Power Partnership, Sony has committed to purchase 44% of energy through renewable


and green energy sources, leading to reduced CO2 emissions and lower overall carbon footprint

(www.sony.net).

In-house allocation of resources focuses on the development of energy efficient products as a

priority for both companies. Through innovation and design initiatives, Panasonic Panama and

Sony Corporation claim “Energy Star” ratings on all consumer goods products (Guide to

Greener Electronics 18, 2012). Energy Star standards signify goods using 20%-30% less energy

than required by federal standards (Tugend, 2008). In addition, regulation of paper purchase is

enforced for both companies to ensure only reputable distributors, not involved in illegal logging

or deforestation activities, are used for paper purchases. Regarding the control of chemical

substances, both companies cite this as an initiative; however neither company provides figures

relative to usage and disposal or specifics on how this is being addressed or controlled internally.

According to Greenpeace Magazine, this is the biggest gap in each company’s execution of

corporate environmental strategy plans (Guide to Greener Electronics 18, 2012).

Commitment locally is evident through company volunteer efforts, sponsorship, and donation to

regional environmental groups in support of environmental facilities. Community activism in

Panama is focused on educating the local population about environmental concerns, eco-friendly

products, and contributions to protect the local ecosystem. At Sony, corporate social

responsibility focuses on the creation of educational facilities, while supporting the creation of

green parks and reforestation efforts. Emphasis on community activities in each country is

tailored to regional needs with both companies locally involved in the development of

environmental programs. A summary of similarities between the companies is provided below in

Table 6.


Table 6: Similarities of Environmental Initiatives

Similarities Panasonic Sony

Company

Environmental

Sustainability Plan

"Eco Ideas" "Road to Zero"

Announced in 2010 with a seven layer focus

on: Resources, Water, CO2 Emissions,

Biodiversity, Chemicals and Stakeholder

and Regional Efforts

Announced in 2010 with a four layer focus

on: Conserving Resources, Curbing Climate

Change, Promoting Biodiversity and

Controlling Chemical Substances

Local Conservation

Alliance

Panama's National Association of Nature June 2008 - support recycling, reforestation

projects, educational lectures and

environmental activities to spread the

awareness locally

U.S. Environmental Protection Agency April 2009 – Green Power Partnership,

committed to purchase 44% of all energy

from renewable or green energy sources

R&D of Energy

Efficient Products

Products meet or exceed "Energy Star"

standards

Products meet or exceed "Energy Star"

standards

Biodiversity

Green Purchasing Policy

Commit to green paper purchases and

elimination of suppliers involved in illegal

logging or deforestation

Paper and Printed Material Purchasing

Policy Reducing company paper usage and

prioritizing suppliers of green products

Controlling

Chemical

Substances

No processes, details or figures provided

outlining legislation or progress

No processes, details or figures provided

outlining legislation or progress

Renewable Energy

Use No targets set or figures provided

No targets set, however renewable energy

accounts for 10% of total electricity

purchased

Community

Activism

Active locally in supporting regional clean-

up efforts, sponsoring educational learning

facilities, funding outdoor educational

recreation establishments and planting trees

to support local ecosystem.

Active locally in supporting regional clean-

up efforts, sponsoring educational learning

facilities, funding outdoor educational

recreation establishments and planting trees

to support local ecosystem.

The similarities of these company initiatives are important because they illustrate, despite

varying degrees of expectations by local communities, and differing levels of operational

regulation in each country, company CSR policies often drive regional environmental awareness

and impact.

4.3 Differences between Panasonic Panama and Sony Corporation of America

Several similarities between the two companies and countries have been identified; however

differences in management of environmental initiatives and country operating regulations are

present between the companies and the locations. Reviewing each company’s environmental

strategy, Panasonic demonstrates a competitive external focus, aiming to become the number one

green electronics retailer by 2018. Sony takes an internal focus, establishing plans to reduce its

environmental footprint to zero by the year 2050. Allocation and investment of resources

specific to each company highlight the difference between external and internal environmental


initiatives. Panasonic’s environmental processes are tailored to achieve the number one green

retailer spot in the industry. For Panasonic, this means extending environmental benefits

throughout the life of the product. Panasonic aims to reduce its environmental impact through

consumer usage of products; therefore Panasonic invests heavily in R&D for green product

development. However, reductions of internal operational and supply chain efficiencies are

prioritized behind eco-product development, with no plans, targets or strategy laid out past 2018.

Specific targets and numbers regarding clean energy usage and reduction of greenhouse gases

have not been identified by the company (Guide for Greener Electronics 18, 2012). Conversely,

Sony’s corporate environmental strategy takes an internal focus with main goals of reducing

impact of manufacturing, distribution and operational systems while supporting green processes.

Sony prioritizes supply chain improvements with a forty year plan and five year incremental

targets to reduce its environmental footprint. As the company progresses, targets are re-

evaluated and adjusted to ensure the company remains on track to a zero footprint by 2050.

However, less focus on external and consumer impact has led to shorter product life cycles and

caused Sony to fall behind Panasonic in overall product development for “green” items (Guide

for Greener Electronics 18, 2012).

An analysis of Panasonic and Sony by the Greenpeace Guide to Greener Electronics provides a

framework for comparing energy usage, product efficiency and operational improvements as

related to increased sustainability efforts. As of November 2012, Sony ranked 8th

by Greenpeace

Guide to Greener Electronics out of sixteen consumer electronics companies, scoring high marks

for production of energy efficient products, clean electricity production and implementation of

their “take-back” recycling program. Panasonic currently holds the 11th

spot, slightly down from

Sony, due to not reducing greenhouse gas emissions over the prior year. However, Panasonic

still scores high marks for energy efficient products and longer product life cycles where it

invests heavily (Guide to Greener Electronics, 2012)). Side by side scorecards for both

companies are provided in Tables 8 and 9 below.


Table 8: Sony Greenpeace Score Card – November 2012

Zero Low Medium High

En

erg

y Disclose and set targets for operational GHG emissions and RE supply

Disclose and set targets for supply chain GHG emissions and RE supply

Clean Electricity Plan (CEP) ENERGY

Clean Energy Policy Advocacy

Pro

du

cts Product energy efficiency

Avoidance of hazardous substances in products

Use of recycled plastic in products PRODUCTS

Product life cycle

Op

era

tio

ns Chemicals management and advocacy

Policy and practice on sustainable sourcing of fibres for paper

Policy and practice on avoidance of conflict minerals OPERATIONS

Provides effective voluntary take-back where there are no EPR laws

Table 9: Panasonic Greenpeace Scorecard

Zero Low Medium High

En

erg

y Disclose and set targets for operational GHG emissions and RE supply

Disclose and set targets for supply chain GHG emissions and RE supply

Clean Electricity Plan (CEP) ENERGY

Clean Energy Policy Advocacy

Pro

du

cts Product energy efficiency

Avoidance of hazardous substances in products

Use of recycled plastic in products PRODUCTS

Product life cycle

Op

era

tio

ns Chemicals management and advocacy

Policy and practice on sustainable sourcing of fibres for paper

Policy and practice on avoidance of conflict minerals OPERATIONS

Provides effective voluntary take-back where there are no EPR laws

In addition to internal and external emphasis in environmental plans, cross-company differences

also include country regulations, monitoring of business processes and validation of

environmental claims. Third party monitoring efforts are required for several U.S. regulations,

with Sony currently operating thirty-one business divisions in North America that are ISO

certified by third party inspection. It is important to note that Panasonic does not offer

certification for third party inspections of environmental standards. External verification

combats corruption and falsification of company information, a process that would benefit a

company in Panama however is lacking at Panasonic. In regards to business processes, specific

internal practices such as regulation of air toxicity, is highly emphasized and monitored at Sony

who has created specific targets and steps to achieve reduced greenhouse gas emissions (GHG).

A goal of 30% reduction by 2015 saw actual results of 32% reduction in total emissions by 2011

www.greenpeace.org

www.greenpeace.org


(www.sony.net). Sony’s success at GHG reduction illustrates the investment in internal

practices to reduce environmental impact as opposed to Panasonic who has been hovering

around a 23% reduction rate since 2006 and has not targeted further absolute reduction goals

(www.panasonic.com). Panasonic quotes GHG targets in millions of tons; however they do not

show proportional reduction to overall GHG emissions, resulting in arbitrary figures. Comparing

clean electricity goals, similar findings are present. A Green Power Partnership with the EPA

and current purchases of 10% renewable energy, mark Sony as a leader in green-energy

commitment. Panasonic, on the other hand, does not publish details of renewable energy usage

or provides plans for future green-energy targets. U.S. regulations such as the Clean Air Act and

monitoring by the Environmental Protection Agency provide greater motivation for companies in

the U.S. to reduce and monitor emissions, while tax credits provide incentive for continued

investment in green energy (www.epa.gov). As a newly emerging country, Panama lacks the

experience for implementation and enforcement of such laws and is in the process of laying

groundwork for monitoring businesses and establishing preservation laws (“90% of

Panamanians,” 2011).

Outside of internal controls such as air toxicity and clean energy plans, Panasonic claims a much

higher external focus with investment in waste recycling rates and product life. Panasonic

operates at a 98.9% waste recycling rate, almost nine percent higher than Sony, which can be

attributed to their use of post-consumer recycled plastics in new product development. This high

waste-recycling rate is also illustrated by their production of long-lasting products. Panasonic

looks to reduce environmental impact through consumer and business usage. Sony fails to

provide specifics on warranties and life-cycles of many consumer products and parts, focusing

instead on internal controls and operational efficiencies. However, Sony offers a local “take

back,” recycling program for consumers, allowing customers to recycle Sony goods at locations

across the U.S., free of charge (ww.sony.net). Panasonic does not currently have a comparable

program in place; however implementation of a similar program presents a great opportunity for

Panasonic to further local efforts of sustainability.

Emphasis on internal processes has produced highly regulated supply chain management systems

as Sony. Sony’s “Green Partner” quality approval program mandates requirements for

outsourcing of component parts, and established guidelines relating to material procurement are

outlined in Sony’s code of conduct. At Panasonic, “green” policies for supply chain

management are less regulated as much of Panasonic’s manufacturing in conducted in-house

(Guide for Greener Electronics 18, 2012). A summary of differences between the companies

can be found in Table 7 below.


Table 7: Differences of Environmental Initiatives

Differences Panasonic Sony

Corporate

Environmental

Strategy Forecast

8 year plan with targets 40 year plan with 5 year targets re-evaluated

annually

Third Party

Monitoring of

Environmental

Efforts

No third party verification or inspection

of environmental standards

Global Environmental Management System

31 business divisions and sites in North

America that are ISO certified and third party

inspected on a yearly basis to ensure recycling

and environmental management standards

Greenhouse Gas

Emission Reduction

Targets

No proportional target reduction Currently at 23% absolute reduction

since 2006 but no details referring to

total percent reduction, targets aimed at

120 million tons reduction by 2018

Reduce emissions 30% by 2015 Met target with 32% reduction in 2011

through increased energy efficiency and use of

renewable energy

Clean Electricity

Plan Not specified Uses 10% renewable energy

Waste Recycling Rate 98.9% - 2012 90% - 2011

Product life

Investment and innovation in increasing

life of products as well as long-standing

warranties and replacements on parts

Does not provide details on innovations for

extending product life or length of product

warranties

Hazardous Materials No commitment to eliminate BFRs or

PVC

Phased out use of BFRs and PVC as of March

2012

Supply Chain

Management

Majority of manufacturing conducted

in-house

“Green Partners”

A quality approval program for Sony suppliers

that must meet Supplier Code of Conduct and

management regulations for procurement of

environment related substances

Local Recycling

Program No policy in place

“Take Back” program offers free recycling

locations for consumers

Government

Regulations Panama U.S.

Organization Centro de Incidencia Ambiental (CIAM) Environmental Protection Agency (EPA)

Emissions Standards No local government regulation

National Ambient Air Quality Standards Regulated by the EPA under the Clean Air Act

sets standards for automobiles and factories

releasing pollutants into the air

Pollution Regulation

General Law of the Environment Regulated by National Environment

Authority (NAM) provides basic

principles for environmental regulation

Pollution Prevention Act Mandates on the treatment and disposal of

waste and chemicals along with the Resource

Conservation and Recovery Act

These results in environmental management and impact are important because they reinforce the

need for accountability among corporations. Without government restrictions or national

standards, business contributions to economic development are dependent on corporate social

responsibility and ethical codes. Preservation of natural habitats and efforts to improve the


quality of life both locally and through reduced pollution efforts are critical in shrinking

environmental impact. Transparency in business processes is necessary to assure performance

levels and stated efforts are upheld.

5 – SUMMARY

A contrast of environmental initiatives and corporate social responsibility between Panasonic

Panama and the Sony Corporation of America, illustrates the varying degree of investment and

focus in reducing a company’s environmental footprint. Contingent on local population

awareness, regional ecosystem complexities, and national government regulations, company

activities must be tailored to country specific regions to maximize overall environmental efforts.

Information for this study was collected through extensive online research and while a face-to-

face interview with Panasonic Panama was scheduled, due to late cancellation this option of data

collection was not available. The online portion of research was conducted using reputable

search engines and keywords detailed in Tables 1 and 2. Through the data collection process

eco-plans for each company were presented in detail, with a focus on local community activism.

Panasonic Panama and Sony Corporation of America are both multi-billion international

consumer electronics companies. Panasonic, located east of the Panama Canal and in operation

since 1970, works locally to promote sustainability through educational volunteer efforts and

sponsorship programs. Sony, located on the United States west coast and in operation since

1970, focuses on local programs to restore ecosystems and regional habitats.

Results from the project case study demonstrate recent steps taken by both companies to reduce

environmental impact as well as future targets for continued progress. While both companies

laid out an environmental corporate strategy, the emphasis of each varied along with

implementation and monitoring processes. Similarities between the companies included a highly

engaged employee population participating in local community events for environmental

awareness as well as volunteer hours for beach clean-up and tree planting. Each company

provided funding locally to varying organizations for development of educational facilities and

preservation of regional biodiversity. Main differences between the two companies were

transparency of information on reporting environmental targets and impact, as well as internal

monitoring to ensure processes were executed in accordance with company standards. Panasonic

focuses on lifetime product environmental impact, looking to promote sustainability through

consumer and business usage of products, while Sony focuses on operational and supply chain

processes to promote sustainability through internal company actions.

The impacts of the results from the case study illustrate varied enforcement of government

regulations and presence of environmental laws between countries. American companies are

closely-monitored for environmental protection as well as development and process restrictions

to limit environmental impact. Panamanian companies are developing into a more defined

environmental groundwork for environmental regulation. These findings are beneficial to

support the development of regional environmental laws specific to protecting local habitats and

ecosystems, as well as the need for third party enforcement and monitoring of business actions.


Successful processes employed by each company can be used to complement existing

environmental strategies in place for companies expanding globally. Dependent on local

environmental concerns and current company opportunities, Panasonic and Sony external and

internal processes highlight successful systems for reducing a company’s overall environmental

footprint.

Overall company management of environmental initiatives and current environmental impact for

each company is detailed in Appendix A at the end of this paper. Greenhouse gases, water

usage, waste management and chemical handling are all listed for between company

comparisons.

Some additional work could be done to include resources being threatened in each region due to

air, water and waste pollution, as well as a closer look at government policies and corruption in

each country to test the accuracy of company reporting and level of enforcement of

environmental laws.


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APPENDIX A

Figure 7: Sony Overall Environmental Impact

Sony.net


Figure 8: Panasonic Overall Environmental Impact

Panasonic.com

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