Yogurt for All

            I have to admit, as someone who has only interned for nonprofits, I have developed a slight bias toward commercial businesses that claim to have a vested interest in bettering society. After all, despite their warm and fuzzy rhetoric businesses are ultimately fueled by profit. Some companies, without getting into specifics, implicitly craft their selfless and noble-sounding mission statements just to attract future shareholders. Also, most consumers never think to visit a company’s website to solidify in their minds what are its mission, vision, and values; they only judge the company on the goods or services they provide. However, after doing a little extra research on Danone (the parent company of Dannon), I was pleasantly surprised to see that some for-profit companies can “practice what they preach” and operate under a business model that is both profitable and benevolent.

            When I went to www.danone.com, I was expecting to be bombarded by advertisements for the brands that the company owns. Instead, the Danone’s homepage has links called “Sustainable Development” and “Research and Innovation” alongside “Our Brands” and “Finance.” Clearly, the site’s goal is to show current and potential shareholders how Danone is committed realizing hidden opportunities within complex, and often tumultuous, global environments.

            Franck Riboud, Danone’s Chairman & CEO, recorded an interview that was published on Danone’s website. In the interview, which is part of the company’s liberally structured “Annual Report,” Riboud comments on Danone’s progress in 2011 and what it hopes to accomplish moving forward. Riboud states, “About 51-52% of our sales are in emerging countries,” which is a 10% increase from what was stated in the 2010 article we read. Riboud also stresses that despite global economic woes and uncertainties, Danone’s emerging markets have remained relatively unscathed and are positive about the future. This statement is most likely geared to assure shareholders that Danone will not be affected problems rising from the European sovereign-debt crisis.

            This point leads me to my one criticism of Danone. Even though the company did research to determine a feasible price to charge consumers in emerging markets, such as in Senegal, I remained unconvinced that yogurt was a necessary part of the Senegalese diet. As the Wall Street Journal reports, better-off Senegalese in the capital of Dakar used to be the target population for dairy sales. While dairy is important to have in a balanced nutrition, it arguably isn’t the most sustaining of food groups. Also, its unclear how Danone is changing the local economies in emerging markets, such as by providing jobs in its factories or hiring locals to sell its products in relatively remote regions.

            These points prove that Danone has not set out to be an NGO disguised as a for-profit company. One last detail that reaffirmed this notion for me was Riboud’s loose definition of Danone’s innovativeness. “Simple things, like a new cup. That’s innovation. Launching a new yogurt 12-pack or 8-pack in the U.S., that’s not an innovation, it’s a revolution!” According to this example, innovation is a method of generating a profit – not a means to improve society (which I still think should be the goal of any innovation). If the latter is also achieved through innovation, then obviously Danone can use that as further leverage to solidify itself as a leader in emerging markets. Yet, to play devil’s advocate, I wonder if Danone would want societies in emerging markets to ultimately improve. Wouldn’t that be bad for business?