Corporate Social Responsibility - Conclusion

Conclusion

(hii, 2019)

What is Corporate Social Responsibility and its Responsibilities?

In Conclusion, “Corporate social responsibility (CSR) can be defined as a self-regulating business model that helps a company be socially accountable to itself, its stakeholders, and the public.” (Invetopedia, 2019) This is simply the approach that businesses take to allow for development by performing positive social, environmental and economic tasks. “According to Carroll’s CSR pyramid, there are four responsibilities of CSR Legal, Philanthropic, Ethical and Economic responsibility.” (tudor2u, 2019)

Advantages and Disadvantages of CSR

Corporate Social Responsibility allow for may advantages and disadvantages that can be very helpful or detrimental for the business. I believe that it would be better for business to perform these Corporate Social Responsibility as there are many benefits which include creating a positive image, increasing in loyal customer and this will lead to an increase in profits. As we know there are always advantages and disadvantage of performing any task. The main disadvantage of performing Corporate Social Responsibility is that it is expensive for business to accomplish. Major businesses can allocate a budget for the CSR expense since they have the revenue while small have it rough. For small business it’s even harder since that have very small revenue so a huge expense like CSR will be detrimental to its continuation. This will create a negative image in the eyes of customer since the business cannot perform CSR.

(Austin, 2017)

The Impact of CSR on Businesses

The impact that CSR has on businesses can be considered either positive or negative. “It has been found that 77% of Canadians only wants to work for a company which has a stronger CSR program.” (Randstad, n.d.) As stated, CSR creates a positive image for the business leading to an increase in loyal customers generating an increase in sales.  From this we can now understand to importance of Corporate Social Responsibility and the advantages and disadvantage.

If you have any question or disagree with anything, I have said please comment in the comment box regarding your thoughts. You can also share your taught on the topic as it would be greatly appreciated.

References

Austin, M. S.–T. (2017, February 17). Corporate Social Responsibility. Retrieved from Corporate Social Responsibility: https://ethicsunwrapped.utexas.edu/glossary/corporate-social-responsibility

hii, c. (2019, January 18). Corporate Social Responsibility – Going beyond the status quo. Retrieved from Corporate Social Responsibility – Going beyond the status quo: http://clementhii.com/corporate-social-responsibility-going-beyond-the-status-quo/

Invetopedia. (2019, February 11). Corporate Social Responsibility (CSR). Retrieved from Corporate Social Responsibility (CSR) - Investopedia: https://www.investopedia.com/terms/c/corp-social-responsibility.asp

Randstad. (n.d.). Retrieved from Randstad interim: https://www.randstad.ca

tudor2u. (2019). Carroll's CSR Pyramid. Retrieved from Carroll's CSR Pyramid: https://www.tutor2u.net/business/reference/carrolls-csr-pyramid

Impact of Corporate Social Responsibility (CSR) on business: Employee perspective

In the previous blogs we discussed about what social responsibility is, its advantages and disadvantages of the same. In this post I would like to mention what impact it makes on the business. It is evident that by performing CSR, there is going to be a considerable impact on the business both in positive and negative aspects. In the previous blog we discussed about how performing CSR leads to a potential brand image in the minds of consumers? Let us have a look at some statistical data which will be helpful to you for understanding CSR impact on business.

·      After conducting 14600 interviews of the workers between age 18-65, working for at least 24 hours a week It was found that 77% of Canadians only wants to work for a company which has a strong CSR program, it depicts the importance and the impact CSR has not only on the consumers but also on the workers/employees. (Randstad, 2018)

·      Another fact of CSR which might draw your attention is that, 71% of Canadians are ready to unpaid voluntary work if their employer allows them paid time off. It shows how today's employee thinks, which means that employees also want to work with the organization which promotes ethics. Today’s employee wants an overall growth not just the vertical growth (Salary raise, incentives) as well as horizontal growth (New/challenging/voluntary work) which adds up to the value of their work at workplace. (Randstad, 2018)

·       55% Canadians while looking for employer take into consideration whether or not  the employer performs charitable and philanthropic activities. This, according to me is a recent trend that employees show inclination to work with employer being participative into serving activities to the society. (Randstad, 2018)

·    Moreover,65% of Canadians think that it is important to work voluntary unpaid to contribute to the society. (Randstad, 2018)

·      It is believed that employees of an organization are the core source of their success. The above mentioned aspects describe that employees shows inclination towards employer which perform some voluntary work for society. (Yang & Basile, 2018) Which also shows that their job satisfaction in some way or the other depends upon their employer realizing responsibility towards society. In return if the employees are satisfied, they get motivated to work better and the organization's performance takes an upward trend. (Merunka, 2014)

                            

                           

Thus, these were some of the statistics which depicts how the CSR impacts a business. The factors which affects behavior of the employees in a business, is the biggest aspect impacting the business. You may comment in the comment box regarding your thoughts for CSR impact on business. You may also share your views as to whether or not you would take into consideration your employer's CSR strategy? and how it affects your behavior? at your workplace.

References:

Merunka, O. F. (2014). The Impact of Corporate Social Responsibility on Organizational. Journal of Business Ethics, 19.

Randstad. (2018, August 2). Retrieved from Randstad interim.ca(how-important-is-corporate-social-responsibility-to-canadian-workers): https://www.randstad.ca/employers/workplace-insights/corporate-culture/how-important-is-corporate-social-responsibility-to-canadian-workers

Yang, J., & Basile, K. (2018). The impact of Corporate Social Responsibility on Brand equity. Marketting intelligence and planning, 2-17.

Image source: https://www.principalpeople.co.uk/blog/2015/11/what-is-corporate-social-responsibility

Corporate Social Responsibility (CSR): Disadvantages

In the previous blog I mentioned about few advantages related to corporate social responsibility. In this blog we will discuss some of the negative aspects (disadvantages) which may arise out of corporate social responsibility if not exercised in a proper manner.

Disadvantages: Though corporate social responsibility is a step taken by organizations voluntarily, but it should be with a view of serving.

1.  Companies might end up using CSR as a tool merely for seeking profits, and it replicates in their functioning and strategies. You can imagine an organization which claims at building sustainable residences in the rural area out of their profits voluntarily, and when later you discover that reality is different then the business may take a dynamic shift. (John M. Abowd,  1990).
2. Corporate social responsibility is an expensive venture. When companies take decisions  regarding corporate social responsibility it may appoint a team for developing a plan for CSR. Other than human resources, time and money which are the components of the pre-implementation process is also deployed. CSR strategy follows typical plan, do, check, act cycle. (Library, 2006)It should be taken into consideration that not all the companies can do so. That means for small companies performing CSR is a critical task.
3. I would like to extend my above-mentioned point that as not all the companies can perform CSR. It is possible that few larger companies may use it for the market share and undesired power struggle in a particular industry and business in general. Which again goes back to my first point of CSR being used as a personal tool merely for seeking profit and not of serving. (Newell, 2014).
4. Even, it leads to few market players controlling the market and which is not good from the consumer point of view. Moreover, in return such an act becomes unethical. (Crowther, 2016)  Thus, these were some of the major disadvantages which I think the organizations should avoid while undertaking CSR initiative. You are more than welcomed to provide your insights regarding the above-mentioned aspects of CSR, or any other points that you feel that needs to be added in the comments below. You may also have a look at the video posted below for more information regarding CSR disadvantages.

References:

Crowther, D. R.-B. (2016). Perspectives on Corporate Social Responsibility. Milton Park, Abingdon, Oxon : Routledge.

John M. Abowd, G. T. ( 1990). The Effects of Human Resource Management Decisions on Shareholder Value. ILR review, Sage Publications.

Library, C. E. (2006). Corporate social responsibility: implementation guide for Canada business. Ottawa: Canadian electronic library.

Newell, A. P. (2014). Corporate Social Responsibility : Challenges, Benefits and Impact on Business Performance. Hauppauge, N.Y.: Nova Science Publishers.

Image source: https://corporate.flyingtiger.com

Video source: https://www.youtube.com/watch?v=eHdvFgCG5n4

Corporate Social Responsibility (CSR): Reason and advantages

So, the question arises as to why companies follow corporate social responsibility? I will state a few points regarding not only “Why” companies do so but also how this move proves to be advantageous to them.

Why:

The simple answer to why organizations/companies do so in one word is “Relation”. Every organization/company thrives for forming long term relations to their customers and by giving back to the society they tend to form strong bond with their customers.

Advantages: 

There are number of advantages for the organization. Following are the major advantages arising out of CSR:

• Easy access to capital: Organizations which work voluntarily towards the benefit of the society creates good reputation in the investor’s world too. Investors have a security as their money is being used in the right direction. Transparency of activities which is often an issue  between investors and companies, up to a large extent gets resolved due to CSR  activities. Moreover, investors may also like to invest into a company which prioritize ethics  above all. (Baker, 2018)
•  Advantageous for the consumers/society: As the companies are doing activities for the  benefit of the consumers and the society it is pretty evident that consumers are the beneficiaries (as they are receiving benefits) . For an instance Kellogg company founded in 1906 considered providing quality products to its consumers as their social responsibility, the company claimed that, “Social responsibility is a way of living at Kelloggs”. Apart from quality products Kelloggs CSR activities include: Protecting the environment, selling nutritious products and advocating healthy life style.(Paetzold, 2010)
• It promotes goodwill: The modern-day strategy of businesses: its not just profit, Goodwill runs the business. I must say that it is a great method to understand business on a deeper level, because now the companies are making efforts on intangible aspects of business such as forming relations with you, your needs/wants, benefit of society, and more so importantly collective growth. As an organization/company considers the responsibility towards people they create an image of a “caring organization”, which will instantly make you form a connection with the company and in turn it will lead to strengthening of their goodwill. (Muir, 2015)
• Profit aspect: I do believe that the companies performing CSR are tend to make more loyal customers then it's competitors. Though it is not done with the intention of making profits but the above-mentioned factors do come down and leads to higher profits as well as competitive advantage. (Paetzold, 2010)
• Inspiring competitors: As some companies take up the initiative voluntarily to serve back the society and when they prosper in doing so, it helps in inspiring the competitors to do the same. Hence, it motivates the other companies in the industry to follow the ethical path. (Paetzold, 2010).
• Thus, these were few of many advantages which I think act as crucial factors why organizations follow CSR. These were my thoughts over advantages of CSR. You may also have a look at the video posted below to get more insights on advantages of CSR. Let me know in the comments whether or not you agree with me? And what other points according to you could contribute to a successful CSR initiative?

 Refrences:

Baker,C.R. (2018). Corporate Social Responsibility (CSR):Practices, Issues and Global Perspectives.  New York: Nova Science Publishers. 

 Muir, S. (2015, July 24). Cube group. Retrieved from Cube group.com: https://cubegroup.com.au

 Paetzold, K. (2010). Corporate Social Responsibility (CSR): an International Marketing Approach.   Diplomica Verlag.

          

    Image source:

    https://maxpeoplehr.com/spread-love-corporate-social-responsibility

                     Video source:

                  https://www.youtube.com/watch?v=YEKyN-4tWsI              

Responsibilities of CSR

Responsibilities of CSR

 (tudor2u, Carroll's CSR Pyramid, 2019)

According to Carroll’s CSR pyramid, the four responsibilities of CSR are:

1. Legal Responsibility
2. Philanthropic Responsibility
3. Ethical Responsibility
4. Economic Responsibility

Legal Responsibility-

“Legal responsibility simply means the responsibility of the business to obey the laws and other regulations.” (tutor2u, 2019) Some legal responsibilities that businesses engage in are health and safety, employment and tax laws. I believe that businesses follow these laws and regulation because it’s the greater good for society and it maintains balance and a good relationship between the business and the government as well as the public.

Philanthropic Responsibility-

According to Eric Dontigney, “Corporate philanthropy often takes the form of investments in the community.” (Dontigney, 2018) Some reasons why businesses invest into communities are to promote awareness for the business and to increase loyal customers. Some examples of Philanthropic responsibilities performed by businesses are donations and sponsorship. 

Ethical Responsibility-

Ethical Responsibilities simply means the business practices that the company engages in are considered to be morally approved or correct. Some examples of Ethical responsibility are fair standard products, equal pay for equal word and efficient use of natural resources. I believe that businesses mainly follow Ethical responsibilities to maintain a positive image internally and externally.

Economic Responsibility-

According to Scott Krohn “Economic responsibility focuses on practices that facilitate the long-term growth of the business, while meeting the standards set for ethical, environmental and philanthropic practices.” (Krohn, 2018) Some example of Economic responsibility is producing recyclable products and paying employees wage/salaries and taxes. Businesses engages in these activities mainly to make profits and also to maintain a positive image.

(tudor2u, Carroll's Corporate Social Responsibility Pyramid, 2018)

If you have any questions or any additional ideas which you feel i missed please comment below. 

References

Dontigney, E. (2018, April 13). Four Types of Corporate Social Responsibility. Retrieved from Four Types of Corporate Social Responsibility | Your Business: https://yourbusiness.azcentral.com/four-types-corporate-social-responsibility-1455.html

Krohn, S. (2018, November 8). Four Types of Corporate Social Responsibility. Retrieved from Four Types of Corporate Social Responsibility: https://bizfluent.com/info-8117691-four-types-corporate-social-responsibility.html

tudor2u. (2018, February 18). Carroll's Corporate Social Responsibility Pyramid. Retrieved from Carroll's Corporate Social Responsibility Pyramid: https://www.youtube.com/watch?v=2_1TLhe8LY8

tutor2u. (2019). Carroll's CSR Pyramid. Retrieved from Carroll's CSR Pyramid: https://www.tutor2u.net/business/reference/carrolls-csr-pyramid