Mercedes-Benz: The Best or Nothing

 

Presentation written by: Marion Bardin & Claire Marion

Presentation supervised by: Assoc. Prof. Dr. Elena M. BARBU, elena.barbu@univ-grenoble-alpes.fr

1 General Informations about the firm

Founded in 1926 by Paul Daimler, Carl Benz and Emil Jellinek-Mercedes, Mercedes-Benz is a german car, bus and truck manufacturer. The group was born thanks to the merger of two companies which names are : Daimler-Motoren-Gesellschaft and Mercedes et Benz. Mercedes-Benz is a division of the Daimler group, which is its parent company.

Located in Stuttgart, in Germany, the head office for Mercedes is the same than for Daimler. The worldwide CEO is, since 2006, the doctor Dieter Zetsche.

In 2017, the turnover of Mercedes Benz was about 95 billion euros[1], for more than 2,3 million of car sales. With these important revenues, Mercedes and Daimler are investing each year in the Research and Development to propose new products adapted to the climate change. But, they devote too an important part of their profits to their shareholders. In fact, in 2017, the group spent 8,7 billions of euros for the Research whose €6,642 million[2] for Mercedes-Benz cars.

The table below shows Daimler’s expenses and investments and his income.

Popular, the company is sharing no less than 1 069 837 447 shares to its shareholders. They perceived a record dividend in 2016, with a amount of €3,25[3] per share. In 2017, this amount increase to 3,65€. That means that in 2017, the company gives a total amount of €3,905 million to its shareholders in dividends.

In the world, about 289 321 person are employed by Daimler in 2017, whose 90% in Europe and 142 666 for Mercedes-Benz cars (global). As an employer, Mercedes makes sure that its employees feel good in their work. To do this, the group is vigilant on several point, namely : the health, the share between the family life and the career, training, flexible work and global work. The strategy of Mercedes is to give liberties to the employees, which allows them to make sense in their work and in the community. The goal of the company is to to create a culture of trust : in the future, with the team…

Mercedes-Benz always wants to produce new powerful products, with more technologies and expertise. Specialized in the High-end product and the premium quality, the group takes benefits of a global implementation. Moreover, the importance attached to research and development and employee training, allows the group to innovate and to be a leader in the car’s market.

The worldwide influence of Mercedes-Benz and Daimler encourages them to deal with environmental and societal causes. Involved the company invests every year in this voice to make its company one of the most committed companies in the world.

From an environmental or social point of view, the company implements various actions and projects throughout the world, for it, for its employees, but also for people in need.

Through this report, we will identify the implications, commitments and efforts that the company makes to meet its commitments in terms of corporate social responsibility.

2 – Environmental and Social actions

2.1 – Environmental actions :

Environment cause is an important part of the corporate social responsibility plan for Daimler and Mercedes-Benz. As a car manufacturer, that isn’t by definition the best protector of the environment, Mercedes-Benz engages in minimizing its environmental impact. Moreover, the company engages in actions for environment preservation and respect. Indeed, Mercedes-Benz uses innovation to serve a conception of the products life cycles and their production more respectful of the environment : electric cars, green combustible, waste reduction, sustainability, etc.

Beside working on its product, Mercedes-Benz undertakes environment preservation and sustainability actions.

155 millions €

The amount of money Daimler invested in environmental protection systems and facilities with integrated environmental protection in 2016 (Source : Daimler Sustainability report 2016).

(91 millions € were invested in 2015)

Mercedes-Benz is working on reducing the environmental risks by closely working with suppliers that are environmentally responsible and fulfill the company’s sustainability requirements. Also the company has a strict environmental risk analysis : a team of auditors visits, at fixed intervals, all Daimler facilities all around the world and make sure that all those facilities are fulfilling the company requirements concerning emissions to the atmosphere and wastewater, waste management, hazardous materials management, damage to the soil and groundwater.

To certificate its engagement for environment protection, Mercedes-Benz’s environmental management system obtained the norm ISO 140001. Also some of the company’s locations are certified with ISO 50001.

Mercedes-Benz engaged in being more energy efficient and reducing its production CO2 emissions. Indeed, they created more energy-saving production methods, more efficient processes, and they use renewable and low-carbon fuels to operate their plants. The goal for the company is to reduce by 25% the energy consumption at Mercedes-Benz cars between 2015 and 2022. We can see on the graph below that Mercedes-Benz is in good way to reach its goal.

The challenge that Mercedes-Benz has undertook is adapting its product to respond to environmental issues that stand in front of the company :

  • Electrical vehicles
  • Hydrogen vehicles
  • Reducing vehicles pollution

Mercedes-Benz is certain that the future is electric. That is why they launched a new product brand, E-Q Electric Intelligence. Electricity is today one of the greenest energy to operate a car engine. Today, 1 kilogram of C02 equivalent is emitted every 4 seconds by European cars : 4.9 billion kilograms of C02 are added to the atmosphere due to cars every year in Europe. By using electricity for its cars, Mercedes-Benz participates in reducing greenhouse gas emitted by cars but also in reducing noise pollution.

The company uses technologies and innovation to create a new generation of lithium-ion electric batteries that permits a long use and the largest number of kilometers possible with one refill, but above all, environmentally compatible. Today, EQ models are not available on the market but it will be launched in this decade, said Dieter Zetsche, head of Mercedes-Benz cars. Other Mercedes-Benz cars such as the B-class are already available on the market since a few years.

The EQ concept is composed with two electric motors on the front and rear axles and a battery integrated into the vehicle floor. So that the concept embodies a powerful vehicle which in combination with the intelligent operating strategy, it will achieves a range of up to 500 km.

The EQ project is not only about cars but also about trucks and buses : Mercedes-Benz wants to commit on all road transport devices to be environmentally respectful and zero-noises.

To ensure continuity in its project of electric cars, Mercedes-Benz takes part in the Ionity project. It consists in creating an european network of electric fast charging stations in partnership with BMW Group, Ford Motor Company and the Volkswagen Group Audi and Porsche. Indeed, today one of the factor that discourages consumers to buy an electric cars is to find electric reloading stations. With this project, the company responds to mobility for long distance travel issues with an electric car. The plan is to launch approximately 400 High-Power-Charging stations by 2020. Also this network will play an essential role in establishing a market for electric vehicles and to step up appealing for electric vehicles. Through 2018, the network will enumerate 100 fast-charging stations.

Mercedes-Benz found another response to reduce CO2 emissions : hybrid vehicles as a mix between electric and conventional mobility and above all, hydrogen mobility. In hydrogen vehicles, the electricity is generated in the vehicle itself from hydrogen, which is fueled as in a traditional vehicle. Also to encourage consumers to change for an hydrogen Mercedes-Benz cars, the company engages in a project of building a hydrogen refueling network of around 400 H2 filling stations in Germany by 2023.

To be environmentally responsible, Mercedes-Benz undertakes several others actions :

  • Solar panels power the logistics center : 5 060 solar panels were installed on the roof of the Global Logistic Center in Gerersheim.
  • Air purification program : Solvents and other substances that damage the layer zone are used during the production. Thanks to a solvent-free paint systems and new technologies, Mercedes-Benz reduces its emissions.
  • Waste and resource management : Mercedes-Benz has a rate of waste utilization of 91%, they recycle and reuse raw materials, indirect materials, and other supplies. Also none of the companies’ waste is exported to other countries.
  • Water pollution control : All the waste water from the plants are treated thanks to an innovative biofilter, before being discharged into lakes and rivers.
  • Nature conservation, land use, and biodiversity : Mercedes-Benges undertakes local actions such as the planting of 50 000 flower bulbs of native species at the Sindelfingen facility, which will serve as food for extinctive type of insects.

2.2 – Social actions :

The second point included in the corporate social responsibility is about the social actions. In other words, that means that companies are engaged in the well being of each people in the world. The actions can be diversified: help charities, participate to humanitarian projects, take care of the education in the world, pay attention to the relation men/women in companies…

Mercedes, with the group Daimler, implements different actions related to this social responsibility. In fact, for the group, to effectively improve the environmental protection, as said before, it is essential to develop the social protection. The corporate social responsibility is considered, in Mercedes, as the key of a business success.

The main goal of the company is to contribute to the advancement and the development of the society. To achieve this objective, Mercedes promote the dialog between cultures all over the world, the education, but the group is also involved in some charitable activities. Moreover, Mercedes go farther by inciting all its employees to make donations and being involving in charitable activities.

Mercedes donates and distributes each year a sum of money to finance partially some social actions. In 2016, the total amount of donations was about 60 millions[4] of euros. This sum was divided according to different domains, as shown in the opposite graph.

We will studying each of the areas to know of what every project consists.

Employees involvement with the corporate volunteering

Mercedes is engaged in the corporate volunteering. That means that, within the company, employees participate to different actions in link with the social responsibility.

One of the most important project of Mercedes in terms of corporate volunteering is the ProCent initiative.

ProCent was born in 2011 and has for slogan “Do good together”. In this project Daimler assume that small amounts can have big effect, especially when they are accumulated. For that, the company asks to its employees to give a part of their salary, a contribution, to different charitable projects. When an employee give an amount, the company give the same one to the project in question. The charitable project which are in link with ProCent are localized in Germany and abroad and are proposed only by the workforce. All the projects supporting result to the corporate social responsibility: conserving the nature and the environment, supporting children and young people, charitable work, support for the disabled.

As shown by the graph below, in 2016, 859 projects have been created with ProCent, principally in Germany but also in Asia, America and Africa. In total, 100 000 employees gave a part of their revenues to help people needy, for a total amount of € 4,9 million.

Moreover, the employees of Mercedes are also acting for a good purpose with the organization of several Days Actions. Those days are considered as hours of work for the participants. During these days, employees can do many things, with one goal for Mercedes : the team development. In fact, besides to assist person in the need, these actions will create links between employees and they are also going to learn to know them better, so they are getting better.

There are different types of projects opened to the employee, for example, they can clean up beaches in Portugal, they can struggle in favor of the literacy, construction of humanitarian houses, preserve the nature with the construction of gardens in some schools, struggle against the disadvantages of women in South Africa…

A really interesting project led by Daimler as part of the social day was the construction of a house for refugees in Stuttgart-Hofen, in Germany. During three days, a group of nine employees of Mercedes used to build this housing for the well being of some refugees.

In addition to allowing refugees to have housing and leisure space, this social project highlighted a new relationship between these colleagues, who were confronted with the realization of new tasks, in a different context.

This kind of actions is therefore as beneficial for the company, the employees as for the people who are helped.

 

→ The Education : science and culture

Education is considered as an essential point for Mercedes, because it creates a lot of opportunities for the future and opens door to many new possibilities for young people. Mercedes and Daimler are considering that give access to the education is the best way to develop the society in general and its group: it is a lasting investment. For that, the group is involved in different projects with the main goal to increase the interest of the inhabitants of the world for sciences and technologies, but also to develop their open mind.

One of the project concerning the education is the Genius one. The objective of this work is to fascinate the young people and to give them the taste of the science and the automotive development. The project is in link with universities and try to develop new learning methods for technical subject such as science, technology, engineering and mathematics.

In fact, the children are invited to practise in hand-on workshop, they visit production facilities, the education is done thanks to the use of entertaining practical. Like that, students can learn all at once theoretical knowledge and the know-how.

Thanks to this kind of education, the children are more curious and involved in their work: it is a way to give an other image of a trade which suck less interest from new generations.

It is a way for Mercedes to train is future employees and researchers.

Genius is not the only project related to the education in which Mercedes is involved. In fact, there is also the “Each girl is a star” project, which is set up in Turkey and which give the opportunity to underprivileged women to have access to school and then to a job.

In the same spirit, to develop the innovation and the creativity, Mercedes care about the Art and the Culture. The group is involved in this field and dispose of its own Art Gallery, the Daimler Art Collection, where 700 artists expose their work, since 1977. Thanks to that, the company create cultural partnership all over the world, which allows it to sponsoring culture everywhere.

Mercedes also support people with disabilities in the fashion world : during its fashion week’s, like in Moscow in 2010, or in Los Angeles in 2016. Daimler encourages fashion designers like Anastasia Anbroskina or Bezgraniz, who think and propose adapted clothes for people with physical disabilities.

 

→ The Charity – Community

The charity is the most important commitment of Mercedes in terms of social responsibility. It takes different forms, and concerns different populations.

The investment of Mercedes is global: the group takes action throughout disastre, but is also involved in long-term projects.

Just after an hurricane in Haiti in 2016, the group founded aid projects to support the inhabitants of the island. The company’s ambition was to give these people access to drinking water to protect them against diseases.

One of the long term projects of Daimler is to help for refugees. The group collect donations, give an education, build housing and help them to find jobs. Moreover, thanks to the Mercedes employee’s involvement, these projects move forward on a daily basis and are beneficial for everyone.

These activities make it possible to improve the daily life of these people, which is essential point of the corporate social responsibility.

Laureus world sport award 2016

Another big project of the group related to the sport is Laureus, created 2000 and co-funded with Richemont. It is a global movement which want to develop interaction between people, thanks to the sport power. Laureus gather different programs, all linked to the sport, which defend values like fairness, tolerance, team spirit. Laureus sport for good foundation is one of these programs, and has for object to give the access to the sport for young who have social disadvantages.

Finally, we can say that across these projects and activities Mercedes and Daimler want to build a better world, with less inequality, and most shares and sciences.

The group is involved in first for its own interest with the science development and the training of young people, but it also bring its help in many projects in the world, in particular with the protection of refugees, to make it better and more human.

3 – Negative aspect and conclusion

Mercedes-Benz has to face some accusations about diesel engine rigging to mask high pollutant emissions. According to the newspaper “Suddentsche Zeitung” whose sources come from german justice, the company would have rig 1 million diesel engines between 2008 and 2016. Those cars was sold both in Europe and America.

On those engine, a special device would have been installed to reduce emissions level in tests conditions, so that it would be imperceptible. As a company that intends to be an environmental responsible company, if those facts reveal to be true it will affect their reliability.

To conclude, we can say that Mercedes-Benz company, although a car manufacturer, has been able to carry out many projects and takes many initiatives in favor of the environment, and ethics. Socially responsible, the company wishes to continue its efforts and its commitments, to ensure a better world. Its major R & D investments will be used for this purpose.

4- Website & bibliography

  • Mercedes – Benz and Daimler official website :

Mercedes : https://www.mercedes-benz.com/

Daimler : https://www.daimler.com/

  • Coroporate Social Responsibility

Sustainability report of Daimler 2016 : https://www.daimler.com/documents/sustainability/other/daimler-sustainability-report-2016.pdf

Genius project : https://www.genius-community.com/

Laureus project : https://www.laureus.com/

  • Others website

Caradisiac – published the 12th of july 2017 : http://www.caradisiac.com/daimler-mercedes-aurait-truque-un-million-de-ses-moteurs-diesels-161433.htm

Statista – Mercedes-Benz revenues 2011-2017 : https://www.statista.com/

Zone bourse : http://www.zonebourse.com/

  1. Statista – Revenue of Mercedes-Benz
  2. Daimler – Financial Figures
  3. Zone bourse
  4. Report Daimler Sustainability 2016