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Businesses do not exist in isolation of their immediate community and beyond, they create products and services to serve their needs for the purpose of profit making. However, as they carry out their industrial and commercial activities for profit making the need to inculcate a sound Corporate Social Responsibility CSR in their core business strategy has become critical to their long term sustainability and commercial success.
This has become even more imperative with the growing sophistication and demands of consumers in Western countries like the United Kingdom UK for brands that are socially and environmentally responsible for without which their continued patronage may be stalled.
The COP21 Global Environmental summit held in Paris in Novemberwhich brought together politicians, scientists, investors, numerous non-governmental organizations and many others, clearly indicate the urgency in reversing the long years of environmental despoliation that the global environment has been subjected to with much of it caused by industrial pollutions of business entities.
This growing awareness has made companies increasingly value the need for an effective CSR strategy which would have a long term effects on their corporate performances Baron, ; Gill, Understanding the connection between the CSR and a firm performance and sustainability has in recent times gotten lots of interest among researchers Bevan,although many argue that their findings are inconclusive and rather misleading Jones, et al ; Vogel, CSR can be seen as those actions that appear to further some social good, beyond the profit seeking interest of a firm and that which may be required by law, to affect the society with positive impact on the community, consumers, environment, and workers Baron, CSR programmes would include those actions that improve the environment, community, and lives of all the stakeholders of a business entity Moon and Vogel, Discussions have suggested that there are several issues that relate to the concept of CSR.
Early scholars have had inconsistencies in the debate regarding CSR Dahlruds, Orlitzky, et alinferred that the inconsistency in the debate over CSR involve fundamental conceptual issues. Friedman is one of such notable scholars who considered shareholder wealth maximization is the single social responsibility of firms and goes ahead to caution against any broader conceptualization of CSR.
In recent times there is a growing saliency of CSR in the strategic objectives of businesses desiring to expand it provision of socially and environmentally responsible products whose demand is quickly gaining momentum Orlitzky, et al, ; Matten and Moon Meeting the needs of present generations without compromising the needs of future generations has further raised the value of CSR not just as a mere gesture but as a necessity.
Business entities are increasingly applying sustainable practices in their operational activities. Sustainability refers to the activities, which the organizations perform, which is voluntarily or mandated by law that shows the inclusion of social and environmental concerns in their business operations.
Implementing a strategic CSR has shown to be successful for some firms and some studies have also shown that the effects of corporate social responsibility has been reached on customer satisfaction and that these strategies can either have a positive or negative impact An increase or decrease in customer satisfaction can have great effect in the market value of a company, and as such increasing consumer patronage through the instrumentality of CSR cannot be taken for granted.
CSR has become one of the very important features of businesses in a rapidly changing global marketplace where consumers growing awareness and sophistication have increased the demands for socially and environmentally responsible products and services.
The despoliation of the global environment due to continued application of unsustainable business practices has seen the promotion of CSR to be increasingly projected in recent times by governments, consumers, non-governmental organizations and other stakeholders. One of the many issues confronting corporate governance is the slow pace of appreciating the positive impact of CSR on organizational competitiveness.
This may not be farfetched, as some organizations still value the age old thinking that the only responsibility of businesses is to make profit. This age old thinking is fast becoming obsolete especially with increasing stakeholders demand for sustainable business activities McKinsey, It is no longer fashionable especially for big companies with international subsidiaries to be found wanting.
This is because the business reinvention that comes with the pursuit of sustainability has cost cutting potentials. This may be in the form of reducing energy wastage, conserving water, recycling, reviewing the integrity of supply chain amongst others. This has seen companies motivated to develop products and services eco-marking campaigns with high certification standards such as: This has seen businesses allocating resources to building their CSR profile; since attracting and retaining quality hire remains one of the critical thrust of effective management.
This segment intends to examine the two broad spectrums of theoretical expressions regarding CSR.
These are the monetarist and the ethicist theories. Thus, the responsibilities an organization owes its stakeholders should begin and end with profit making.
This profit oriented theory suggest that the more a company engages in CSR whose cost must be lower than profit derived from itthe better it will be for its overall economic benefit since it will affect the patronage of it product and more so, its social development efforts will equally develop infrastructure that further aid the business wealth creation efforts.
The implication of this is that CSR has an extensive economic context that businesses have come to leveraged on to develop a business to CSR approach. This may not be farfetched as businesses are increasingly engaging in eco-marketing and labeling to enhance their images, boost customer base and ultimately increase their bottom-line.
These responsibilities should not be underpinned by the fact of profit making but to create a better society and a more sustainable environment. PRI is anchored on the value of businesses taking up CSR in area that uphold environmentally and socially responsible behaviors.
To this end, ethicists advocate that businesses should accord CSR to the communities in which they operate not primarily for profit making but as a moral obligation for their continued sustenance De Schutter, The implication of these two broad theoretical perspectives Monetary and Ethical theories is that CSR is either carried out by organizations for its underlying financial gains or as a moral obligation to the society and maybe even both at the same time.
In another study conducted by Jones, et al, on major global retailers, they discovered discrepancies in their business activities that undermine public confidence such as the use of their sustainability agenda to pursue underlying business objectives rather than the true essence of social and environmental responsibilities.
In studies conducted by Moon and Vogel and Mckinsey on the environmental sustainability of the retail industry, highlighted several challenges ranging from waste management to electricity consumption to mode of recycling to mention a few.
While efforts are being made such as applying green technology to overcoming these challenges more effort are still needed to really achieve success and such effort besides spending so much money requires a simple change in behaviour that discourages unsustainable environmental practices.
Frooman investigation of the linkage between corporate social responsibility CSR and corporate financial performance CFP using twenty seven event studies of stock market reactions to companies falling short of social responsibility, found out that the market reacted negatively to such companies thereby undermining shareholders wealth.
In another event study conducted by Jones, et al. The process of getting that tea, coffee, chocolate or beef from Sainsbury to the consumer and how the consumer trash the leftovers all have certain effect on the environment that the implementation of effective CSR intends to address.Corporate Social Responsibility.
Corporate Social Responsibility (CSR) is a self-regulatory mechanism incorporated by corporations in their business model. The term CSR is also used for activities carried out by companies around the globe to give back to the society. Corporate Social Responsibility (CSR) is without doubt a key feature of national and global corporate citizenship in a much more competitive marketplace where the need to be responsive to needs of the .
In this essay, classical and contemporary view of governance on corporate social responsibilities will be put into discussion before coming to a conclusion under strategic sustainability. In addition, theoretical frameworks and real world corporate cases will be reason about in the respective governances.
Corporate Social Responsibility Essay Sample.
Corporate social responsibility (CSR) is concerned with the relationship between the corporate sector and society, and focuses on particularly good corporate citizenship. CORPORATE SOCIAL RESPONSIBILITY The term social responsibility means different things to different people.
Generally, corporate social responsibility is the obligation to take action that protects and improves the welfare of society as whole as well as organizational interests.
Essay on “Corporate Social Responsibility and Ethics” Type of paper: Essays Subject: Business Words: Social responsibility is an idea that has been of concern to mankind for many years.