Reckitt Benckiser plc (LSE: RB) is a British global consumer goods company, making and marketing home, health and personal care products. Headquartered in Slough, near London, UK, it has operations in over 60 countries, including 42 manufacturing facilities, and sales in nearly 200 countries. RB is ranked 6th in the 2008 European Business Week 50, the magazine's annual ranking of the best performing companies within the S&P European 350.
The company's strategy is to have a highly focused portfolio concentrating on its 17 most profitable brands, which were responsible for 62% of net revenues in 2008. 35% of net revenues come from products launched in the past three years, this focus on innovation was recognised by The Economist Corporate Use of Innovation Award in 2009.
In 2008, the BBC broadcast an investigaton into the methods RB used to maintain the market share of the Gaviscon powerbrand.
The company has held Platinum status in the Business In The Community CR Index, since 2005 and in 2009 entered the Dow Jones Sustainability World Index and the Carbon Disclosure Leadership Index.
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History
Reckitt & Colman
Colman's was founded in 1814 when Jeremiah Colman began milling flour and mustard in Norwich, England. Reckitt & Sons started in 1840 when Isaac Reckitt rented a starch mill in Hull, England. He diversified into other household products and in due course passed on his business to his four sons. Reckitt & Sons was first listed on the London Stock Exchange in 1888. In 1938 Reckitt & Sons merged with J&J Colman to become Reckitt & Colman Ltd. Reckitt & Colman sold the Colman's food business in 1995 but still has some food brands.
Benckiser
Johann A. Benckiser founded a business in Germany in 1823. Its main products were industrial chemicals. Benckiser went public in 1997.
Merger and subsequent developments
The company was formed by a merger between Britain's Reckitt & Colman and the Dutch company Benckiser NV in December 1999. Bart Becht became CEO of this new company and has been credited for its transformation, focusing on core brands and improving efficiency in the supply chain . The new management team’s strategy of “innovation marketing”. – a combination of increased marketing spend and product innovation, focusing on consumer needs – has been linked to the company’s ongoing success. For example, in 2008, the company’s “rapid succession of well publicised new product variants” were credited for helping them “to capture shoppers' imagination” Business Week has also noted that “40% of Reckitt Benckiser's $10.5 billion in 2007 revenues came from products launched within the previous three years.”
In October 2005, Reckitt Benckiser agreed to purchase the over-the-counter drugs manufacturing business of Boots Group, Boots Healthcare International, for £1.926 billion. The three main brands acquired were Nurofen in analgesics; Strepsils sore throat lozenges; and Clearasil anti-acne treatments.
In January 2008, the company acquired Adams Respiratory Therapeutics, Inc., a pharmaceutical company, for $2.3bn: one of the major brands acquired with this purchase was Mucinex.
In July 2010, the company agreed to buy SSL International, the makers of Durex condoms and Scholl's footcare products in a £2.5Bn deal.t
Operations
The company divides its brands into six categories: surface care, fabric care, dishwashing, home care, health and personal care, and food.
RB has a very fast-paced and challenging working culture and likes to portray a truly global outlook by placing management staff out of their 'comfort zones'. For example, a German manager wouldn't necessarily be left to work in Germany; they may be posted in Brazil for two years, followed by India for the next role. This allows employees to have an international focus.
The company runs a number of graduate programmes, in most of its markets, with over 200 graduates joining the schemes worldwide. Once hired, graduates tend to work for a couple of years as a trainee in the country in which they were originally employed, followed by a posting overseas for those who have excelled during initial training. Graduate trainees start off in one of the firm's business areas: Marketing & Sales; Supply Chain; Research & Development and Information Systems.
The European Graduate Programme, for example, starts with a placement on the sales team of a country where the candidate can speak the local language. After a year, the graduate is moved to another European country for their marketing assignment.
As part of its recruitment initiative, RB launched a blog, myRBopportunity, which features blog posts and commentary from graduates who have recently joined the company. The blog also features guest bloggers such as RB CEO Bart Becht and other senior management or industry experts.
Corporate governance
The current Chief Executive of Reckitt Benckiser is Bart Becht. His pay was £36,760,000 in 2008 to 2009 meaning he earned 1,374 times the wage of an average employee.
Current members of the board of directors are: Bart Becht, Adrian Bellamy, Colin Day, Dr Peter Harf, Kenneth Hydon, Graham Mackay, André Lacroix, Judith Sprieser and David Tyler.
Current members of the executive committee are: Colin Day, Rakesh Kapoor, Bart Becht, Rob de Groot, Amadeo Fasano, Freddy Caspers, Gareth Hill and Simon Nash.
Gaviscon controversy
In 2008, the BBC's Newsnight programme broadcast a report which accused Reckitt Benckiser of attempting to delay the introduction of a competitive, generic version of one of its most popular products, Gaviscon, a treatment for heartburn and gastroesophageal reflux disease. Introducing the report, reporter Martin Shankleman said, “Gaviscon is hailed as a power brand by its owners, Reckitt Benckiser.” He continued,
“Reckitt Benckiser like to claim that the profits flow from their expertise in marketing. But we know that there's another way in which they've been coining it in—by ripping-off the NHS; as a whistle-blower has told us.
The “whistle-blower” was shown in silhouette and his words were spoken by an actor: “Reckitt's cheated the National Health Service. It could have saved the NHS millions of pounds. But not just the NHS, patients, doctors—they've cheated health professionals. I felt it had to be exposed”.
Newsnight claimed that Reckitt Benckiser had a “secret plan to ensure that it kept its stranglehold” after the Gaviscon patent expired in 1999, and that Newsnight had seen the plan. The Department of Health asked Newsnight to hand its documents to the NHS counter-fraud service.
The investigation was widely reported in the British press. The Guardian quoted a leaked memo in which the product's manager explained that the company could use “the rationale of health and safety” to design a switched product to “muddy the waters.” The newspaper quoted Reckitt Benckiser as stating that the leaked memos were “inappropriate and did not reflect Reckitt's eventual actions”.
The Independent quoted Warwick Smith, director of the British Generic Manufacturers Association (BGMA): “The sort of evergreening alleged by Newsnight can cost the NHS tens of millions of pounds with no patient benefit.” It also quoted a statement issued by the company: “…Reckitt Benckiser is a responsible company and we have therefore instigated an immediate internal investigation and will take action. However, we do not accept much of what has been alleged.”
The Times noted that “Although Gaviscon has been out of patent for almost ten years, no other manufacturer has developed a cheap generic version. Such a drug could have saved the NHS up to £40 million.” It stated that the Office of Fair Trading was expected to examine whether Reckitt had acted illegally. It also printed verbatim extracts from several of the leaked memos. The Times’ report included an extract from the statement issued by the company (see below).
In response to the Newsnight report and the reports in the press, Reckitt Benckiser issued a statement which began:
We are shocked by the allegations made as Reckitt Benckiser is a responsible company in the way it conducts its business.
Nevertheless, we are deeply concerned by the inappropriate sentiment expressed in some of the historic internal correspondence reported. We take this very seriously and have instigated an immediate internal investigation, and will take action. We also refute much of what has been reported which implies a power and influence we simply do not possess.
The company has never objected to a monograph driven generic name being published. The timetable of which is not, and never has been, within our control a monograph/generic name could have been published at any time by the regulators without reference to any third party.
The company made appropriate challenges where it felt it was justified in order to ensure patients are prescribed the right treatment. These were within the law and relevant regulations. We stress that the regulators only take a comment into account when it is valid.
Environmental record
Initiatives
Carbon 20
Reckitt Benckiser has implemented an environmental initiative called Carbon 20. The initiative, which was announced in November 2007, aims to cut the total carbon footprint of its products – from creation to disposal – by 20% by 2020. As part of the initiative the company has reduced by 70% the amount of plastic in the packaging of its Vanish cleaner.
The Independent characterised the Carbon 20 initiative as “a typically savvy bit of marketing” on the part of Bart Becht, the company's CEO. It observed that Reckitt Benckiser's initiative seemed to go further than similar green initiatives by other companies, and that it would lead to increased profits.
The article quoted a city analyst who follows Reckitt Benckiser: “I was surprised by this. Reckitt has never been considered the most environmentally enlightened company, they are typical red-blooded capitalists”. The newspaper also spoke with Martin Deboo, an analyst at Investec: “They've done this because they have to, because they have these products that are seen as messy and full of lethal chemicals”.
In New York in February 2009, Earthjustice filed a lawsuit against Reckitt Benckiser and others. The petition seeks to compel the companies to identify all of the ingredients used in their products. Earthjustice contacted several companies in September 2008 requesting that they comply with a 1971 law requiring them to disclose the ingredients in their products and make available any associated health or safety studies. Reckitt Benckiser and the other defendants ignored or refused the request.
Trees for Change
In June 2006, Reckitt Benckiser launched Trees for Change, a major forestation project designed to offset the greenhouse gasses created as a by-product of its manufacturing processes. The project aims to create over 25 square kilometres of forest by planting more than two million trees on previously deforested land in British Columbia, Canada. Over the next 80–100 years the forest will absorb over two million tonnes of CO2, making the company carbon neutral for 2006, 2007, 2008 and 2009.
Awards
In 2008, in the U.S., RB was one of 40 companies awarded Champion Status in the Safer Detergents Stewardship Initiative (SDSI). The SDSI “recognizes environmental leaders who voluntarily commit to the use of safer surfactants”. In 2010, RB achieved Platinum ranking in the Business in the Community Corporate Responsibility (CR) Index, a status the company has consistently achieved since 2005. The index is an audited “voluntary, self-assessment survey, comprising 88 sets of questions on how companies are managing, measuring and reporting their social and environmental impacts”.
Charitable partnership
The company are Save The Children’s most valuable UK-based corporate supporter.” Their staff fundraises in many different ways, from football tournaments and silly hat wearing to payroll giving and marathon running. Members of staff in 2009 completed a global employee trek, facing the challenges of natural disaster and altitude sickness in order to raise almost £250,000 for the charity. In 2010, RB partnered with Save The Children to raise awareness of the plight suffered by India's brick kiln children.
Corporate branding
In 2009, Reckitt Benckiser revamped its corporate identity to reposition its brand as 'the power behind the Powerbrands'. This saw the launch of a new logo to replace the logo which had been introduced at the time of the Reckitt/Colman merger in 1999. The new logo is a pink kitemark containing the letters 'RB'. The logo is often used with the company's full name Reckitt Benckiser in grey alongside the kitemark logo, using a typeface designed especially for the company
The new logo, created by branding agency The Workroom, was inspired by a sports kite and is intended to reflect the 'loud, confident personalities of its Powerbrands'. The identity has been introduced on packaging, and is used on internal and external communications.
As part of the corporate brand review, the company relaunched its core values , the key values which drive their business:
Achievement
Don't just aim high, aim to outperform
Entrepreneurship
Encouraging bold thinking, initiative and commercial drive and allowing daring ideas to thrive
Ownership
Taking full responsibility for, and the initiative to do what's needed in business and in developing and engaging teams
Team spirit
Driving success by pulling together. Treating each other and our differences with a high degree of respect, sharing ideas, failures and successes
Brands
These 17 Powerbrands accounted for 62% of Reckitt Benckiser’s net revenues in 2008, and 61% in 2007.
Reckitt Benckiser’s most profitable and most recognised brands are:
- Vanish
- Calgon
- Woolite
- Lysol
- Dettol
- Cillit Bang
- Harpic
- Finish (previously Electrasol in North America)
- Air Wick
- Mortein
- Strepsils
- Mucinex
- Nurofen
- Gaviscon
- Veet
- Clearasil
- French’s foods.
This is a list of other brands owned by Reckitt Benckiser:
- Aerogard
- Amphyl
- Bonjela
- Brasso
- Brio
- Bryza
- Calgonit
- Cattlemen's
- Ceraclen
- Cherry Blossom
- Chore Boy
- Clean and Smooth
- Cling
- Cling Free
- Cobra Brilliant Shiner
- Colon
- d-Con
- Coral
- dip-it
- Disprin
- Dosia
- Easy-Off
- Easy On
- Elena
- Finish (previously Electrasol in North America)
- Frank's Red Hot
- French's Foods
- Glass Mates
- Glass Plus
- Glassex
- Hoffmann's
- Intima Liasan / Intima Bidex
- Kalia
- Kaltron
- Lanza
- Lemsip
- Lewis Red Devil
- Lime-A-Way
- Lovela
- Masterpiece Metalist
- Mop & Glo
- Mr. Sheen
- Mr. Min
- Nenuco
- Neutra-Air
- NoSalt
- Noxon
- Nurofen for children
- Old English
- Perk
- Poliflor Pratic
- Poliflor Maximo Brilho
- Precision Blend
- Quanto
- Resolve
- Rid-X
- Robin Blue
- Sagrotan
- Sani Flush
- Senokot
- Sipuro
- Spray 'n Starch
- Spray 'n Wash
- Suboxone
- Vani-Sol
- Vitroclen
- Vivid
- Wenol
- Windolene
- Wizard
- Yes
- Zud
References
- ^ a b c Annual Results 2009
- ^ Reckitt Benckiser: Jobs
- ^ European BusinessWeek 50 Scoreboard BusinessWeek Europe 50 Interactive Scoreboard, 2008.
- ^ a b Reckitt Benckiser: Annual Report and Accounts 2008
- ^ The Economist Corporate Innovation Award Economist Corporate Use of Innovation Award 2009.
- ^ a b Business in the Community corporate responsibility index
- ^ Dow Jones Sustainability Index
- ^ Carbon Disclosure Project 2009 Reports launched at New York Climate Week
- ^ a b c d e f Reckitt Benckiser History
- ^ The case for US GAAP Global Finance, January 1998.
- ^ Reckitt & Coleman announce further delay to Dutch merger Independent, 7 November 1999.
- ^ Picking Winners at Reckitt Benckiser Accenture, October 2005.
- ^ Reckitt Benckiser revenue up 20% The Guardian, 28 July 2008.
- ^ Reckitt Benckiser Cleans Up Business Week, 23 April 2008.
- ^ Reckitt Benckiser buys Boots unit BBC News, 2005.
- ^ Reckitt completes Adams tender offer Biomedicine, 30 January 2008.
- ^ “Durex maker SSL agrees £2.5bn bid from Cillit Bang firm”. July 21, 2010. http://www.bbc.co.uk/news/business-10708737. Retrieved July 21, 2010.
- ^ [1] Reckitt Benckiser's graduate programmes.
- ^ [2], RB's European Graduate Programme.
- ^ Datablog, 'FTSE100 directors pay: the £1 billion in boardrooms' The Guardian; Another source, which is paid for by the company itself, leaves out significant bonuses and perks accruing through the year, “Bart Becht: Executive Profile & Biography”. BusinessWeek. McGraw-Hill. http://investing.businessweek.com/research/stocks/people/person.asp?personId=370149&ric=RB.L. Retrieved 2009-08-10., total annual compensation is £4,336,000, this consists of a £949,000 salary and £3,387,000 bonus
- ^ Reckitt Benckiser. Reckitt Benckiser: “Corporate Governance”. Reckitt Benckiser. http://www.reckittbenckiser.com/site/RKBR/Templates/InvestorCentreCorporateGovernance.aspx?pageid=237/ Reckitt Benckiser:. Retrieved 2009-06-22.
- ^ “Gaviscon maker 'cheated the NHS' (video report)”. BBC. 2008-03-08. http://news.bbc.co.uk/player/nol/newsid_7280000/newsid_7284600/7284696.stm?bw=bb&mp=wm&news=1&ms3=6&ms_javascript=true&bbcws=2. Retrieved 2009-04-13.
- ^ “Gaviscon maker 'cheated the NHS'”. BBC. 2008-03-07. Archived from the original on 2009-04-13. http://www.webcitation.org/5g0YX6RFr. Retrieved 2009-04-13.
- ^ Leigh, David (2008-03-07). “Company accused of cheating NHS”. London: Guardian Media Group. Archived from the original on 2009-04-13. http://www.webcitation.org/5g0Xn0HZ7. Retrieved 2009-04-13.
- ^ Laurance, Jeremy (2008-03-08). “Drug giants 'swindle NHS by blocking cheap medicines' extending patents”. Independent News & Media. Archived from the original on 2009-04-13. http://www.webcitation.org/5g0Z5iDIA. Retrieved 2009-04-13.
- ^ Jameson, Angela (2008-03-07). “Reckitt Benckiser accused of ripping off NHS over Gaviscon”. Times Newspapers Limited. Archived from the original on 2009-04-13. http://www.webcitation.org/5g0jZjRMg. Retrieved 2009-04-13.
- ^ Times Online (2007-03-07). “The Reckitt Benckiser memos in full”. Times Newspapers Limited. Archived from the original on 2009-04-13. http://www.webcitation.org/5g0hxnHKd. Retrieved 2009-04-13.
- ^ Reckit Benckiser (2008-03-07). “Statement in response to media reports about Gaviscon”. Reckitt Benckiser Corporate Communications. Archived from the original on 2009-04-13. http://www.webcitation.org/5g0ilNBYE. Retrieved 2009-04-13.
- ^ Reckitt Benckiser: Carbon20
- ^ a b c Forston, Danny (2 November 2007). “The Independent”. Reckitt Benckiser boss commits to 20 per cent cut in group's carbon footprint within 13 years (Independent News & Media). http://www.independent.co.uk/news/business/news/reckitt-benckiser-boss-commits-to-20-per-cent-cut-in-groups-carbon-footprint-within-13-years-398689.html. Retrieved 2009-06-05.
- ^ Earthjustice (February 2009). “Cleansing Products Disclosure Petition”. Earthjustice inc.. http://www.earthjustice.org/library/legal_docs/cleaning-products-disclosure-petition.pdf. Retrieved 2009-06-05.
- ^ Biello, David (February 18, 2009). “Scientific American”. Earthjustice Wants Companies to List Chemicals in Household Cleaners (Scientific American, Inc. (USA)). http://www.scientificamerican.com/article.cfm?id=chemicals-in-household-cleaners. Retrieved 2009-06-05.
- ^ Reckitt Benckiser (June 2006). Reckitt Benckiser: Carbon20 “Trees For Change”. Reckitt Benckiser. http://www.reckittbenckiser.com/sites/carbon20/index.html Reckitt Benckiser: Carbon20. Retrieved 2009-06-05.
- ^ Tree Canada “Tree Canada”. Reckitt Benckiser Plants Trees for Change. Tree Canada. 28 Jun 2006. http://www.treecanada.ca/news/06-28-2006.htm Tree Canada. Retrieved 2009-06-05.
- ^ EPA. “Design for the Environment (DfE)”. Safer Detergents Stewardship Initiative (SDSI). Environmental Protection Agency. http://www.epa.gov/dfe/pubs/projects/formulat/sdsi.htm. Retrieved 2009-06-05.
- ^ Companies working with us Save The Children
- ^ Reckitt Benckiser goes over the top for charity 23 June 2009 Save The Children.
- ^ “Reckitt-Benckiser unveils new logo”. Marketing Magazine. http://www.marketingmagazine.co.uk/news/881502/Reckitt-Benckiser-unveils-new-logo. Retrieved 2009-06-18.
- ^ [3]
- ^ Reckitt Benckiser. “Online Report 2008”. Reckitt Benckiser. http://annualreview2008.reckittbenckiser.com/site/AR08/Templates/Home.aspx?pageid=3&cc=G. Retrieved 2009-06-22.
External links
- Official site
- Yahoo profile
- RB employees' blog
- RB on Facebook
- RB on Twitter
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