|Public limited company|
|Founded||1814 (J&J Colman)
1840 (Reckitt & Sons)
1938 (merger of Reckitt & Sons and J&J Colman)
1999 (merger of Reckitt & Colman and Benckiser)
|Headquarters||Slough, England, UK|
|Adrian Bellamy (Chairman)
Rakesh Kapoor (CEO)
Consumer healthcare products
Personal care products
|Revenue||£8.836 billion (2014)|
|£2.185 billion (2014)|
|£1.663 billion (2014)|
Number of employees
Reckitt Benckiser Group plc (RB) (LSE: RB) is a multinational consumer goods company headquartered in Slough, England. It is a producer of health, hygiene and home products. It was formed in 1999 by the merger of the UK-based Reckitt & Colman plc and the Netherlands-based Benckiser NV.
RB's brands include French's Mustard, the antiseptic brand Dettol, the sore throat medicine Strepsils, the hair removal brand Veet, the air freshener Air Wick, Calgon, Clearasil, Cillit Bang, Durex, Lysol, Mycil and Vanish. It has operations in around 60 countries and its products are sold in almost 200 countries.
- 1 History
- 2 Operations
- 3 Products
- 4 Corporate governance
- 5 Corporate social responsibility
- 6 Anti-competitive behaviour
- 7 Legal challenges to rodenticide regulations
- 8 References
- 9 External links
Reckitt & Sons started in 1840 when Isaac Reckitt rented a starch mill in Hull, England. He diversified into other household products and after his death in 1862, the business passed to his three sons. In 1886, Reckitt opened its first overseas business in Australia. The firm was first listed on the London Stock Exchange in 1888. Harpic Lavatory Cleaners was acquired in 1932, and that same year, Dettol was launched.
In 1938 Reckitt & Sons merged with J. & J. Colman, which had been founded in 1814 when Jeremiah Colman began milling flour and mustard in Norwich, England, to become Reckitt & Colman Ltd. The company made several acquisitions, including the Airwick and Carpet Fresh brands (1985), the Boyle-Midway division of American Home Products (1990), and the Lehn & Fink division of Sterling Drug (1994).
Reckitt & Colman sold the Colman's food business in 1995.
1999 to present
The company was formed by a merger between Britain's Reckitt & Colman plc and the Dutch company Benckiser NV in December 1999. Bart Becht became CEO of the 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, RB agreed to purchase the over-the-counter drugs manufacturing business of Boots Group, Boots Healthcare International, for £1.9 billion. The three main brands acquired were Nurofen's analgesics, Strepsils sore throat lozenges, and Clearasil anti-acne treatments. In January 2008, RB acquired Adams Respiratory Therapeutics, Inc., a pharmaceutical company, for $2.3 billion; one of the major brands acquired was Mucinex. In July 2010, RB agreed to buy SSL International, the makers of Durex condoms and Scholl's footcare products, in a £2.5 billion deal.
On 27 August 2011, RB recalled all remaining stock of its major analgesic product, Nurofen Plus, after packs were found to contain an antipsychotic drug. It turned out that this was the work of a codeine addict who had been stealing the pills and replacing them with his anti psychotic medication.
In April 2011, Bart Becht announced he was to retire as CEO of Reckitt Benckiser and would be replaced from September 2011 by executive vice president of Category Development, Rakesh Kapoor, who had played a key role in recent acquisitions.
In November 2012, RB agreed to acquire Schiff Nutrition, a United States-based manufacturer of vitamins and nutritional supplements including Digestive Advantage, MegaRed, Airborne, and Move Free, for US$1.4 billion (£877 million). In December 2014, RB spun off its specialty pharmaceuticals business, which produces Suboxone, into a separate company named Indivior.
In 2014, Reckitt Benckiser announced it was dropping its full name in favour of RB. According to the chief executive, Rakesh Kapoor, the old name was "a bit of a mouthful" and the name change would make life easier.'
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 and sales, supply chain, research and development, human resources and information systems.
RB organises the majority of its products into three main categories – health, hygiene and home – with other brands belonging to three further categories: food, pharmaceuticals and portfolio brands. The company's strategy is to have a highly focused portfolio concentrating on its 19 most profitable brands, which are responsible for 70% of net revenues.
Reckitt Benckiser currently produces the following products:
RB's current directors are: Rakesh Kapoor, Adrian Bellamy, Dr. Peter Harf, Jaspal Bindra, Nicandro Durante, Mary Harris, Adrian Hennah, Ken Hydon, Dr. Pamela Kirby, André Lacroix, Sue Shim, Christopher Sinclair, Doug Tough, and Warren Tucker. Current members of the executive committee are: Rob de Groot, Amadeo Fasano, Roberto Funari, Frederic Larmuseau, Darrell Stein, and Deborah Yates.
From the company's creation in 1999 until he retired in 2011, Bart Becht was CEO. He was widely credited with the company's recent success. The Guardian called him "one of the most successful businessmen of his generation". Under him, the company focused on its core brands, and on improving efficiency in the supply chain. It also increased its marketing budget. BusinessWeek noted that "40% of RB's $10.5 billion in 2007 revenues came from products launched within the previous three years". Becht was Britain's highest-paid businessman, taking home more than £90 million in 2009. In April 2011, he announced that he would step down in September of that year, to be replaced by Rakesh Kapoor, who had been with the company since 1987. Reckitt Benckiser shares fell by 6.6% on the news.
Save the Children
Save the Children has described RB as its "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 2011 a group of 65 RB employees took part in a Global Challenge in Brazil, some undertaking a dangerous trek and others volunteering on a community project. In June 2012, 20 employees from six countries across Latin America took part in a gruelling trek challenge and helped to build a community centre in Cali, Colombia, raising £63,000 for Save the Children.
In its Full Year Results for 2012, RB stated it had helped to reach approximately 325,000 children and families in 2012 and since the relationship with Save The Children began in 2006 the initiative has reached nearly 900,000 vulnerable children and families.
RB implemented an environmental initiative called Carbon 20. The initiative, which was announced in November 2007, aimed 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.
In January 2010, RB announced that they had already reached the halfway mark on their carbon reduction target in the third year of the Carbon20 initiative. RB stated "Over 3 million tonnes of CO2 was avoided last year by an 11% reduction per unit dose in the carbon impact across our products’ life cycle – the same impact as taking nearly 1,000,000 cars off the road". RB cited new programmes to redesign products using fewer materials and less energy, packaging, and waste, along with moving a number of factories and plants to combined heat and power energy systems as the main contributors to achieving the target so far.
The Independent characterised the Carbon 20 initiative as "a typically savvy bit of marketing" on the part of Bart Becht, the company's former CEO. It observed that RB's initiative seemed to go further than similar green initiatives by other companies, and that it would lead to increased profits.
In New York in February 2009, Earthjustice filed a lawsuit against RB 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. RB and the other defendants ignored or refused the request.
In September 2012, following the success of Carbon 20, RB launched a new strategy for sustainable innovation, betterbusiness, which focuses on the changing needs of women and the scarcity of water. The initiative sets three key goals for 2020: a third of net revenue to come from more sustainable products, a reduction in the water impact per product by one-third across its lifecycle and a reduction in carbon footprint per dose by a third.
In June 2006, RB launched RB Trees (then known as Trees for Change), a major forestation project designed to offset the greenhouse gases created as a by-product of its manufacturing processes. The project aims to plant 10,000,000 trees, on land used or previously cleared for cultivation, to turn this back to forest.
In 2008 the BBC's Newsnight 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. In his introduction, reporter Martin Shankleman said, "Gaviscon is hailed as a power brand by its owners, Reckitt Benckiser". He continued,
"Reckitt Benckiser likes 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 RB 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 RB 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: "...RB 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, RB issued a statement that 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.
Legal challenges to rodenticide regulations
In 2008 the United States Environmental Protection Agency (EPA) announced a decision to remove second-generation anticoagulant rodenticides from store shelves, leaving the products available for purchase only by US licensed applicators. The ruling was slated to go into effect in 2011 allowing poison companies time to adjust to the new law. EPA's decision was based on tens of thousands of reports of pet, wildlife and child poisonings that resulted annually from rat poisons in the US alone. In 2011, Reckitt Benckiser makers of d-CON products initiated a legal challenge to the EPA expected to take several years to resolve. Early in 2014, California State Department of Pesticide Regulation ruled that anticoagulant rat poison sales would be restricted beginning on 1 July 2014. RB filed suit in San Diego County Superior Court in April 2014 to block the decision.
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