SOCIAL IMPACT

THE COMMUNITY KFC Gold standard KFC Singapore prioritizes promoting its Gold Standard practice to highlight eating right and maintaining good nutritional practices to build up one's body resistance and immune system.

Figure 1: KFC Gold Standard practice (Source: http://kfc.com.sg) However, KFC has been highly criticized for its unhealthy food business which cause heart disease, high rate of obesity and cancer due to the ridiculously high sodium and cholesterol contained in its core products (chicken, burger, chips). Some of KFC chicken contained three times more monosodium glutamate than regular chicken (Municipal Food Inspector - Ray, 1995).

Social diversity KFC workforce well reflects the diversity of Singapore workforce including Chinese, Malaysian, Indonesian, Indian, Filipino, Vietnamese, Myanmar, and Bangladeshi etc. entitle for equivalent rights and employment fairness. That is part of the companys founding How We Work Together principles. KFC global culture is actively developing a workforce that is diverse in style and background, where everyone can make a difference. KFC Singapore has been recognized as most Caring Employer 2011 by (csrsingapore, 2011). Ambassador for the Deaf KFC Singapore is known as Friend of the Deaf or Ambassador for the Deaf (since 2004) due to its collaboration with The Singapore Association for the Deaf to create employment opportunities and improve the quality of life amongst the Deaf community through opening three Deaf-operated restaurants, employs over 300 deaf employees as an effective way to promote Deaf awareness in Singapore. KFC earns its Leaders Award, and the highest honor of "The President's Social Service Award" in 2006 (KFC announcement) for the above initiative.

Figure 2: Deaf store Toa Payoh Lorong 1 (Source: http://sglinks.com/) The question is What is the actual initiative behind this beautiful kind hearted act? KFC spokesman Mr. Balakrishnan once announced We are not employing them out of pity, nor are we running a quota system. Were employing

them on the basis of merit Is that for real? Would the fact that the shortage of Singapore workforce situation getting worsen addition to KFC is one of the lowest salary offering in Singapore F&B industry ring any bell? Does it approach the Deaf community with an initiative of a Friend of the Deaf or it runs out of employment opportunity to its target employee segments of secondary students, PR housewives and abandoned elderly due to pay package not attractive enough. Perhaps the employment of the Deaf is just a trade off to get permission of employing hard working, productive foreign workers. It is required a certain percentage of Singaporean employees to satisfy the merits set by the Ministry of Manpower Singapore. (For example to get approval of employing 01 foreigner, KFC needs to employ 2.5 local Singaporean (2008)). World hunger relief World Hunger Relief Program was established in 2007 by Yum to provide much needed life-saving food to millions of people in over 80 of the worlds poorest countries via the United Nations World Food Program (WFP). KFC is proudly participates in this meaningful fund-raising program by rising over SGD 245,000 for WFP (KFC Singapore announcement). Instead of donating hundreds of thousands dollars for World Hunger Relief Program during the last 4 years, if KFC could cut down its annual discard food of approximately 150,000 kilos (KFC internal control report 2010) millions hungers out there should not be that suffering. SUPPLIER CODE OF CONDUCT KFC Singapore is committed to conducting its business in a legal, ethical and social responsible manner. It strongly encourages its suppliers comply business ethical practices as well as legal requirements and ethical business practices such as compliance with laws, regulations and employment practices; non-discrimination, strictly no child labor, proper practice audits and inspections procedures. (Refer Appendix 1 for full description of KFC Supplier Code of Conduct).

ANIMAL WELFARE There were accuses of KFC allows its supplier breed and drug chemicals and antibiotics to the chickens for better output or sliced off baby chicks beaks (Animal News, 2009) and much more cruel acts. To gain trust and a very high market share of Muslim community in Singapore, all KFC outlet in Singapore is Halah certified. It needs to comply with all Islamic restricted rules of food handling and processing that is why it takes very serious caution by monitoring its suppliers to ensure they are using Islamic Slaughtering procedures (refer Appendix 2) and maintaining high standards of handling animals. KFC Poultry Welfare adopted specific, comprehensive welfare standards guidelines of handling, processing chickens and audits its suppliers against those standards since 2000.

ENVIRONMENTAL IMPACT
PACKAGING Plastic packaging has been strongly discouraged by society; although implementing more environmental friendly paper packaging KFC still unable to please the society. The argument is paper packaging is directly contributing to the destruction of forests. International Paper was the main packaging supplier of KFC, a company notorious for destructive forest practices like large scale trees clearance, converting plantation from natural forests and applying forest management by reliance on toxic chemicals. KFC Singapore is now switching from cardboard to recyclable and biodegradable paper wrapping for its top selling burgers (Fillet, Zinger) for more efficient usage of paper (Marketing Week, 2009). More over KFC voluntarily collaborates with the government to achieve 05 years plan of flexibility reducing its packaging waste costeffectively and awarded Gold Award Winner 2011 by NEA (nea.gov.sg, 2011).

Figure 3: KFCs Packaging Efforts (Source: http://plasticsandtheplanet.com/) KFC now uses polypropylene (PP) for side dishes containers instead of polystyrene (PS) foam containers. The advantage is microwavable, dishwasher safe, leak resistant and are fully recyclable at the end of life (Miriam Wilcox-Barsalou, 2010). PALM OIL KFC cooking oil was covered contains Trans fatty acids, which increase cholesterol - the risk of having heart attack (Jefry Naga, 2010) as much as saturated fat did. Trans fatty acids are believed to be twice as damaging as saturated fat (Nutrition Action Health letter by CSPI, 1997). Moreover the global expansion of palm oil usage has contributed to the mass destruction of tropical rainforests in Indonesia and Malaysia to make way for palm plantations which has inadvertently caused large amounts of greenhouse gases being pushed into the atmosphere (Jefry Naga, 2010). KFC Singapore is considering the replacement of palm oil high oleic rapeseed oil, which widely used by most of the KFC outlets in UK and Ireland, responded to environmental awareness. However the implementation has a huge affect on the companys profit margin.

RECOMMENDATIONS
With the issue faced by KFC, it is recommended that the company should be able to use an ethical management strategy that will uplift the image of the company. In this regard, the company may use societal marketing strategy. Societal marketing is that branch of marketing concerned both with the uses of marketing knowledge, concepts, and techniques to enhance social ends as well as with the social consequences of marketing policies, decisions, and actions. The purview of social marketing is, therefore, broader than that of managerial marketing. It refers to the study of markets and marketing activities within a total social system. Societal marketing emerged because of the convolution of several factors and forces in the marketing environment. These include affluence, technology, communications media, better informed citizens, increased educational opportunities, and social value changes. The latter can be considered as one of the most powerful single influences.

The concept of societal marketing adheres to the business ethics which states that the task of an organisation is to identify the needs, wants and interest of its audience and to provide the desired satisfactions more effectively than its rivals in such a manner that preserves or improves the well-being of both the consumers and the society especially in terms of health nutrition. In addition, such marketing approach calls upon marketers to give emphasis to three important aspects of their marketing policies. These include company profits, consumer wants and satisfaction and public interest.

The main purpose of societal marketing is to adhere to the needs of the company, its target market and the society where they belong. The societal marketing concept also means having social responsibility which is to be accomplished by the company. In return, the company is being benefited on establishing good reputation not only with their stakeholders but to the entire market place. Hence, it is recommended that each and every company should be able to apply and practice societal marketing concept.

In doing so, the company must choose who among the members of the society is in need and how they can sustain their needs. The company must also remember that applying societal marketing also means having social responsibility which should be done for the company and the societys sake.

The inclusion of the social responsibility concept to the business sector is not only necessary to broaden the companies involvement to social matters. The application of social responsibility to organizations is in fact a main contributory factor to their profitability and to ensure that they always follow ethical matters while doing their business.

A study has been conducted with regards to the significance of social responsibility to profitability ( 2001). Although, further studies are still necessary in order to analyze the correlation of these factors, the findings of Mohr and Webb showed that social responsibility plays a significant role in consumer appeal. The perceptions of consumers however, tends to vary with regards to this aspect. Nonetheless, this stresses the importance of social responsibility not only on benefiting the stakeholders but also in achieving the goals of the companies towards growth and profitability.

At present, the management of KFC have already realized the growing importance of social responsibility and that integrating this concept cannot be sufficiently supported by the optimization of shareholder value.

KFC's processing guidelines and audits are designed to manage and monitor each step of the process to determine whether the birds supplied to KFC are handled humanely and any suffering is minimised. KFC audits its suppliers for compliance, and non-compliance could result in termination of the supplier's contract. KFC's policies for its suppliers apply to all chicken intended to be sold to KFC. As a major purchaser of food products, they have the opportunity, and responsibility, to influence the way animals supplied to them and are treated. RESOLVED: Shareholders request that the board of directors adopt and implement a comprehensive sustainable palm oil policy. Supporting Statement: We believe that in order to effectively address this issue, the Company should adopt a policy that includes: a target date for sourcing 100% Certified Sustainable Palm Oil or for purchasing GreenPalm certificates covering 100% of sourced palm oil, plans to verify suppliers' compliance with the policy, supporting a moratorium on palm oil expansion in rainforests and peatlands, and a commitment to disclose the company's progress on this issue. IT WON'T affect the taste of the chicken, according to fast-food giant KFC, but it will affect Australian farmers. KFC Australia will soon drop imported palm oil from its kitchens and replace it with canola oil made from Australian-grown canola. After trialling canola oil in its kitchens in Tasmanian stores since October 2010, KFC will announce today that it is making the change. Canola oil will be used in KFC stores across Australia from May 21. Chief marketing officer for KFC Australia, Nikki Lawson, said: ''All our chicken is local, all our flour, all our fresh ingredients are sourced locally.'' Mrs Lawson said the palm oil that KFC Australia has been using is ''sustainably sourced'' from a supplier that is a member of the Roundtable on Sustainable Palm Oil. She denied that KFC was abandoning palm oil because of negative community sentiment towards it. Advertisement Leif Cocks, president of the Orangutan Project, welcomed KFC's decision to dump palm oil. ''It's a great move. Palm oil isn't a sustainable product as it's currently grown. It's destroying the habitat of many endangered species, including orangutans.''

Read more: http://www.theage.com.au/national/kfc-plans-to-fry-with-the-good-oil20120514-1yn2t.html#ixzz23QjF4bCO

Read more: http://wiki.answers.com/Q/Does_KFC_use_sustainable_palm_oil'#ixzz23QilgwUQ References Imaal, A 2010, KFC Social Responsibility Management Project, scribd.com, accessed on August 11th 2012, <http://www.scribd.com/doc/29976506/KFC-SocialResponsibility-Management-Project> KFC Singapore website, accessed on August 11th 2012, <http://www.kfc.com.sg/> Yum Brands, Responsibility: World Hunger Relief, Yum! Brands CSR, accessed on August 11th 2012, <http://www.yum.com/responsibility/whr.asp> Sabrina Zolkifi, M 2011, KFC And Holiday Inn Honoured For Showing Heart, humanresourcesonline.net, accessed on August 11th 2012, <http://www.humanresourcesonline.net/news/25452> Jackson Curtis, F 2011, KFC CSR report: Business studies blog, accessed on August 11th 2012, <http://mrhughesbusiness.blogspot.com/2011/02/kfc-csr-report.html> UK Essays, 2012, Corporate Social Responsibility Csr: KFC case, UK Essays.com, accessed on August 12th 2012, <http://www.ukessays.com/essays/sociology/corporate-social-responsibility-csr.php> Care2, A 2011, Stop KFC From Destroying Our Forests, thepetitionsite.com, accessed on August 12th 2012, <http://www.thepetitionsite.com/takeaction/598/404/771/> The Independent, A 2011, KFC to stop using palm oil, eco-business.com, accessed on August 12th 2012, <http://www.eco-business.com/csr/kfc-to-stop-using-palmoil/> Singapore Compact CSR Awards 2011, csrsingapore.org, accessed on August 12th 2012, <http://www.csrsingapore.org/csrsummit/singapore-compact-csr-awards2011>

World Hunger Relief, N 2010, KFC Facebook page, accessed on August 13th 2012, <http://www.facebook.com/notes/kfc-singapore/world-hunger-relief2010/162277583813362> AnimalNews, M 2009, KFC allows the Torture of Chickens for the Greed of Money Killing for Cash, KentuckyFriedCruelty.com, accessed on August 13th 2012, <http://www.kentuckyfriedcruelty.com/u-undercover.asp> Islamic Religious Council of Singapore, 2005, General Guidelines for the Handling and Processing of Halal Food, muis.gov.sg, accessed on August 13th 2012, <http://www.halalrc.org/images/Research%20Material/Report/Processing%20of%20 Halal%20Food.pdf> Kristelle, J 2009, KFC Switches to Earth-Friendly Packaging, Environmental Leader LLC, accessed on August 13th 2012, <http://www.environmentalleader.com/2009/01/28/kfc-switches-to-earth-friendlypackaging/> Miriam Wilcox-Barsalou, O 2010, KFCs Packaging Efforts, Plastics and the Planet, accessed on August 13th 2012, <http://plasticsandtheplanet.com/archives/317>

Ivythesis, A 2009, Ethics Management: KFC, ivythesis.typepad.com, accessed on August 13th 2012, <http://ivythesis.typepad.com/term_paper_topics/2009/08/ethicsmanagement-kfc.html>

APPENDIX 1: KFC SUPPLIER CODE OF CONDUCT Compliance with Laws and Regulations Suppliers are required to abide by all applicable laws, codes or regulations including, but not limited to, any local, state or federal laws regarding wages and benefits, workmen's compensation, working hours, equal opportunity, worker and product safety. Yum also expects that Suppliers will conform their practices to the published standards for their industry. Employment Practices Working Hours & Conditions: In compliance with applicable laws, regulations, codes and industry standards, Suppliers are expected to ensure that their employees have safe and healthy working conditions and reasonable daily and weekly work schedules. Employees should not be required to work more than the number of hours allowed for regular and overtime work periods under applicable local, state and federal law. Non-Discrimination: Suppliers should implement a policy to effectuate all applicable local and federal laws prohibiting discrimination in hiring and employment on the grounds of race, color, religion, sex, age, physical disability, national origin, creed or any other basis prohibited by law. Child Labor: Suppliers should not use workers under the legal age for employment for the type of work being performed in any facility in which the Supplier is doing work for Yum. In no event should Suppliers use employees younger than 14 years of age. Forced and Indentured Labor: In accordance with applicable law, no Supplier should perform work or produce goods for Yum using labor under any form of indentured servitude, nor should threats of violence, physical punishment, confinement, or other form of physical, sexual, psychological, or verbal harassment or abuse be used as a method of discipline or control. Notification to Employees: To the extent required by law, Suppliers should establish company-wide policies implementing the standards outlined in this Code and post notices of those policies for their employees. Audits and Inspections Each Supplier should conduct audits and inspections to insure their compliance with this Code and applicable legal and contractual standards. In addition to any contractual rights of Yum or Unified Foodservice Purchasing Co-op, LLC ("UFPC"), the Supplier's failure to observe the Code may subject them to disciplinary action, which could include termination of the Supplier relationship. The business relationship with Yum and UFPC is strengthened upon full and complete compliance with the Code and the Supplier's agreements with Yum and UFPC. Application The Code is a general statement of Yum's expectations with respect to its Suppliers. The Code should not be read in lieu of but in addition to the Supplier's obligations as set out in any agreements between Yum or UFPC and the Supplier. In the event of a conflict between the Code and an applicable agreement, the agreement shall control.

APPENDIX 2: ISLAMIC SLAUGHTERING (MUIS HALAL CERTIFICATION STANDARD) SCOPE This Appendix provides guidelines on the requirements and procedure of Islamic slaughtering, as per stipulated by the Shariah Law. Islamic slaughtering is necessary for all life Halal animals except for marine and nonmammal land animals, of which any form of merciful killing method can be adopted. CRITERIA The Slaughter All life Halal animals must be killed in the most merciful manner possible to afflict the least pain on the animals. The Slaughterer (a) In manual slaughtering, the slaughterer must be a Muslim. (b) In automatic slaughtering, the person pressing the button must be a Muslim. The Blade (a) The blade must be made from metal and should be very sharp and not serrated, such as saw, or with some chipping on its cutting edge. (b) Proper procedures must be in place to ensure that the knife is properly maintained to ensure continuous sharpness. The Animal The animal should be alive before the slaughter. Neck Area To Be Severed (a) Both the animals windpipe and gullet must be cut. If only one of them is cut, the slaughter is not valid. (b) It is makruh to sever the head totally, although the slaughter is still valid. THE PROCEDURE Before The Slaughter (a) The animal should be rested and fed.

(b) The holding area for the animals should not be in close proximity to the slaughtering place. The distance should be in such a way that the animals in the holding area will not be able to see or sense the slaughtering in action. (c) The knife used for the slaughter should be inspected for any chipping (d) The knife should be sharpened for each slaughter. (e) In automatic slaughtering, the animals should be positioned so that the blade will cut the front part of the neck and not other body parts. (f) The slaughterer or the person switching on the automatic slaughtering machine must be a Muslim. (g) Where possible, the animal and/or the slaughterer should face the direction of Qiblah. During The Slaughter (a) The slaughterer or the person switching on the automatic slaughtering machine should recite Basmalah (b) In manual slaughtering, the knife should not leave the neck until both the windpipe and the gullet has been cut. (c) In automatic slaughtering, the depth of the cut should be enough to cut both the windpipe and the gullet, and not to sever the head completely. (d) In automatic slaughtering, all the animals that have been positioned for slaughtering should be checked to ensure that they are still alive. Dead animals should be removed, since it will be impossible to differentiate between a life one and a dead one after the slaughter. After The Slaughter (a) The animal should be allowed to die before any skinning or defeathering (b) Any jerking motion should be allowed to subside and stop completely before further process. 2005 Majlis Ugama Islam Singapura