The AAR Corp is a multinational corporation founded in 1951 by Ira Eichner. It maintains an enduring presence in the aviation and aerospace industry as the largest supplier of aftermarket products and services besides buying, selling, and leasing new and used commercial aircraft, engines, and engine products. Interestingly, AAR’s corporate social responsibility (CSR) portfolio is nearly as broad as its product line, prompting a critical observer to interrogate the business value the schemes offer. Social impact initiatives can only offer maximum value to the business and remain sustainable if explored from the company’s end of the equation.
The AAR Corporate’s CSR strategies focus on four areas: veterans, active military and their families, SEM-focused education, health, and diversity and inclusion. The company supports active and retired military alongside their families by partnering with organizations like Rags of Honor, Navy SEAL Foundation, and Marine Corps Scholarship Fund. AAR also invests heavily in education, with a bias on STEM through sponsorships, mentorships, and inspiration. It has partnered with Cool Aeronautics, How Things Fly, and other organizations to advance education in science, technology, engineering, and math. Moreover, the business promotes health and wellness through financial and skills contributions to groups focusing on research and cure of diseases like cancer. Some of these partners are Mayo Clinic and the American Cancer Society. Finally, AAR promotes diversity and inclusion by supporting women and equal representation.
Although AAR’s current CSR plan has many advantages, it requires some improvement to attract maximum social value. Yeatman’s podcast (as cited in Hessekiel, 2015) advances that gauging CSR value requires determining the business outcomes promising maximum interest to the firm, match them with relevant social results, identify how the team can best achieve them, and contrast the status quo against the ideal. AAR’s workforce is 24 percent vets, and supporting the military and their families promises a stable labor supply. Similarly, investing in education, especially STEM, equips the next generation with relevant skills needed to meet the company’s innovation needs. Likewise, being a multinational corporation necessitates wearing a global image, and by advocating for inclusivity and diversity, the company attracts labor and market across cultures. However, it is unclear what business objective AAR Corp seeks to achieve through its broad well-being approach.
The plan could benefit from some improvements, especially in its health and wellness initiatives. It appears that the corporation is thrusting itself into this sector more for the cause than the business. This initiative could be redefined by first figuring how an aviation business could benefit from a breakthrough in cancer treatment or general wellness. For example, the company could invest in this area if it seeks to compete in healthcare, has employees whose work condition predisposes them to certain diseases, or serves clients with such medical needs. To implement this program, AAR can continue partnering with the same research institutions it currently does, namely the Alzheimer’s Association and American Cancer Society, and work towards specific business gain. For instance, promoting employees’ health and wellness will help the company minimize losses due to absenteeism. Additionally, showing the customers that the company cares about their health, not just their money, can improve corporate image.
I agree with Perry Yeatman’s assertion that a company stands a better chance at building a program that will simultaneously benefit it and the cause when the CSR initiative is defined from the business end of the equation. An excellent example can be gleaned from Intercorp’s need to build tomorrow’s workforce. With a foothold in Peru, a country facing an employment shortage whereby employers suffer severe skills deficit when seeking to fill open positions, Intercorp decided to explore the CSR contours to satisfy its labor need. As Wyman (2016) explains, the company decided to offer affordable, high-quality education through technical institutes, equipping children and young adults with the skills deemed beneficial to the firm. Investing in education benefits the company with more potential employees who already value the brand and willing to contribute to its success – a true win-win.
Another noteworthy example is Jubilee Foods Corporation’s (JFC) efforts to strengthen the supply chain of vital raw materials. This fast-growing corporation owns numerous fast-food restaurants in the Philippines. It relies heavily on agricultural products such as animal produce, cereal, and vegetables. However, the Philippines records frequent extreme weather conditions such as typhoons, making the agricultural sector particularly vulnerable. Wyman (2016) notes that JFC decided to mitigate this problem by investing in CSR with a particular interest in steadying its supply of raw materials. Accordingly, it partnered with individual farmers and provided them with training, effectively converting them into functioning cooperatives. Today, JFC buys directly from the producers, eliminating the middlemen and their associated nuisances. The company enjoys the flexibility and relatively stable prices when sourcing raw materials from a different part of the country if the other records low agricultural produce due to whatever reasons. Farmers’ income has improved significantly, and, most importantly, JFC is assured of high product quality all year round.
In conclusion, social impact initiatives should not be about the cause, per se. Instead, it must be a direct means to achieving a specific business goal. Corporate social responsibility is what a business offers to the community in exchange for a steady supply of skills, raw materials, or patronage. Using Perry Yeatman’s suggestions for rewriting the CSR equation from the business end, this essay analyzes AAR social impact plan and suggests necessary improvements to optimize social value. Any CSR initiative that fails to attract value to the business is unsustainable and may fail, hurting the business in terms of lost resources and poor public relations.
AAR Corporate. (2021). Corporate social responsibility. AAR CORP. Web.
Hessekiel, D. (2015). Rewriting the corporate social responsibility equation. Forbes. Web.
Wyman, O. (2016). Social innovation: A guide to achieving corporate and societal value. World Economic Forum. Web.