This past February, CVS Pharmacies announced it will discontinue sales of Tobacco products. CVS’s reasoning behind this decision is to continue their mission to build a firm focused on providing health rather than large retail business. Discontinuing sales of Tobacco strengthens the persona of CVS in the eyes of all stakeholders. A brand that dedicates itself to presenting clients with health advice/products is a brand that consumers, shareholders, executives, etc. can be proud of owning stakes in. This move is detrimental to the future of CVS because they are a health based company selling products well known for its negative health effects. Edward Freeman, in his take on the stakeholder theory states that ” a business in the community that is not a good citizen…… is a business in decline.” By selling tobacco products, CVS was ignoring its duty to customers. By reevaluating tobacco sales, CVS took on it’s role of protecting the health of it’s consumer base (being a good citizen). CVS has taken a step away from the philosophy of Milton Friedman who believes “The social responsibility of business is to make profits”. This major pharmacy chain has embraced social responsibility as being good corporate citizens. They’ve vowed to look after the health of all members of CVS community.
CVS article Link
Milton Friedman article Link
Edward Freeman Video Link