Corporate social responsibility - Wikipedia, the free encyclopedia. Corporate social responsibility (CSR, also called corporate conscience, corporate citizenship or responsible business). CSR policy functions as a self- regulatory mechanism whereby a business monitors and ensures its active compliance with the spirit of the law, ethical standards and national or international norms. With some models, a firm's implementation of CSR goes beyond compliance and engages in . CSR strategies encourage the company to make a positive impact on the environment and stakeholders including consumers, employees, investors, communities, and others.
Proponents argue that corporations increase long- term profits by operating with a CSR perspective, while critics argue that CSR distracts from businesses' economic role. A 2. 00. 0 study compared existing econometric studies of the relationship between social and financial performance, concluding that the contradictory results of previous studies reporting positive, negative, and neutral financial impact, were due to flawed empirical analysis and claimed when the study is properly specified, CSR has a neutral impact on financial outcomes. Some sociologists viewed CSR as a form of capitalist legitimacy and in particular point out that what began as a social movement against uninhibited corporate power was transformed by corporations into a 'business model' and a 'risk management' device, often with questionable results.
Business ethics is the part of applied ethics that examines ethical principles and moral or ethical problems that can arise in a business environment. ISO 2. 60. 00 is the recognized international standard for CSR. Public sector organizations (the United Nations for example) adhere to the triple bottom line (TBL). It is widely accepted that CSR adheres to similar principles, but with no formal act of legislation. Definition. Companies express this citizenship (1) through their waste and pollution reduction processes, (2) by contributing educational and social programs and (3) by earning adequate returns on the employed resources. Most consumers believe companies doing charity will receive a positive response. Somerville also found that consumers are loyal and willing to spend more on retailers that support charity.
Corporate Social Responsibility Program About. ISACA’s corporate social responsibility (CSR) program is a formalized approach to giving designed to promote. Corporate social responsibility, often abbreviated 'CSR,' is a.
Consumers also believe that retailers selling local products will gain loyalty. However, environmental efforts are receiving negative views given the belief that this would affect customer service. This includes monetary donations and aid given to nonprofit organizations and communities. Donations are made in areas such as the arts, education, housing, health, social welfare and the environment, among others, but excluding political contributions and commercial event sponsorship. For instance, procurement of Fair Trade tea and coffee.
Creating Shared Value, or CSV is based on the idea that corporate success and social welfare are interdependent. A business needs a healthy, educated workforce, sustainable resources and adept government to compete effectively. For society to thrive, profitable and competitive businesses must be developed and supported to create income, wealth, tax revenues and philanthropy. The Harvard Business Review article Strategy & Society: The Link between Competitive Advantage and Corporate Social Responsibility provided examples of companies that have developed deep linkages between their business strategies and CSR.
CSV acknowledges trade- offs between short- term profitability and social or environmental goals, but emphasizes the opportunities for competitive advantage from building a social value proposition into corporate strategy. CSV gives the impression that only two stakeholders are important - shareholders and consumers. Many companies employ benchmarking to assess their CSR policy, implementation and effectiveness. Benchmarking involves reviewing competitor initiatives, as well as measuring and evaluating the impact that those policies have on society and the environment, and how others perceive competitor CSR strategy.
Corporate social responsibility (CSR. Accounting, auditing and reporting. Accepting Applications for October 2016 Program. Corporate Social Responsibility. The United Nations Environment Program Financial Initiative asked one of the world’s largest law firms to research whether.
According to Barney (1. However, should competitors imitate such a strategy, that might increase overall social benefits. Firms that choose CSR for strategic financial gain are also acting responsibly. RBV presumes that firms are bundles of heterogeneous resources and capabilities that are imperfectly mobile across firms. This imperfect mobility can produce competitive advantages for firms that acquire immobile resources.
Mc. Williams and Siegel (2. CSR activities and attributes as a differentiation strategy.
Social responsibility is a duty every individual has to perform so as to maintain a balance between the economy and. Corporate Social Responsibility; Social.
They concluded that managers can determine the appropriate level of investment in CSR by conducting cost benefit analysis in the same way that they analyze other investments. Reinhardt (1. 99. CSR- based strategy could only sustain an abnormal return if it could prevent competitors from imitating its strategy.
Later, it expanded to include supplier behavior and the uses to which products were put and how they were disposed of after they lost value. Supply chain. Irresponsible behavior reflected on both the misbehaving firm, but also on its corporate customers. Supply chain management expanded to consider the CSR context. Wieland and Handfield (2. They highlighted the use of technology in improving visibility across the supply chain. A corporate social responsibility individual or team plans the goals and objectives of the organization. As with any corporate activity, a defined budget demonstrates commitment and scales the program's relative importance.
Accounting, auditing and reporting. Crowther defines social accounting as .
The standard scheme has been build around ISO 2. UNCTAD Guidance on Good Practices in Corporate Governance. The standard is applicable by any type of organization.; Earthcheck Certification / Standard.
Social Accountability International's SA8. Standard Ethics Aei guidelines.
The ISO 1. 40. 00 environmental management standard. The United Nations Global Compact requires companies to communicate on their progress. Many companies produce externally audited annual reports that cover Sustainable Development and CSR issues (. Critics dismiss these reports as lip service, citing examples such as Enron's yearly . This requirement was implemented in the absence of formal or legal standards. An Integrated Reporting Committee (IRC) was established to issue guidelines for good practice.
Verification. The accounting, auditing and reporting resources provide a foundation for consumers to verify that their products are socially sustainable. Due to an increased awareness of the need for CSR, many industries have their own verification resources.
The United Nations also provides frameworks not only for verification, but for reporting of human rights violations in corporate supply chains. Ethics training. The aim of such training is to help employees make ethical decisions when the answers are unclear. Organizations see increased employee loyalty and pride in the organization.
They do not try to manipulate or falsely advertise to potential consumers. This is important for companies that want to be viewed as ethical. Social license. Social license exists outside formal regulatory processes. Social license can nevertheless be acquired through timely and effective communication, meaningful dialogue and ethical and responsible behavior. Displaying commitment to CSR is one way to achieve social license, by enhancing a company. While CSR benefits are hard to quantify, Orlitzky, Schmidt and Rynes. Profit is the economic value created by the organization after deducting the cost of all inputs, including the cost of the capital (unlike accounting definitions of profit).
Another criticism is about the absence of a standard auditing procedure. The term was coined by John Elkington in 1. Potential recruits often consider a firm's CSR policy.
CSR can also help improve the perception of a company among its staff, particularly when staff can become involved through payroll giving, fundraising activities or community volunteering. CSR has been credited with encouraging customer orientation among customer- facing employees.
Reputations that take decades to build up can be ruined in hours through corruption scandals or environmental accidents. CSR can limit these risks. A CSR program can persuade governments and the public that a company takes health and safety, diversity and the environment seriously, reducing the likelihood that company practices will be closely monitored.
Supplier relations. E. g., a fashion merchandiser may find value in an overseas manufacturer that uses CSR to establish a positive image. They argue that the reputational benefits that CSR companies receive (cited above as a benefit to the corporation) demonstrate the hypocrisy of the approach. For example, Mc. Donald's Corporation positioned its association with Ronald Mc.
Donald House as CSR. Such firms may engage in the same philanthropic activities as those in other industries. This duality complicates assessments of such firms with respect to CSR. The Kizhakkambalam takeover.
Environmentalists and mainstream politicians of India point out that this can lead to a dangerous precedent because the company got actively involved in CSR only after they were caught red- handed in polluting the village. The stakeholder perspective fails to acknowledge the complexity of network interactions that can occur in cross- sector partnerships. It relegates communication to a maintenance function, similar to the exchange perspective. However, definitions of what constitutes ethical behavior vary.
For example, some religious investors in the US have withdrawn investment from companies that violate their religious views, while secular investors divest from companies that they see as imposing religious views on workers or customers. Through education and dialogue, the development of community awareness in pushing businesses to change their behavior is growing. Creating Shared Value (CSV) claims to be more community aware than CSR.