Corporate Social Responsibility - Research Paper Example

More companies are including social responsibilities into their business plan today Corporate social responsibility(CSR) is an initiative or any undertaking by a company to take responsibility and accountability for the effects of its activities on the surrounding environment and the social welfare of the communities around its area of operation. It may incur some costs that are short term and do not have immediate benefits on the fiscal position of the company. However, it will endorse positive ecological and social change. Additionally, it helps a company to promote its vision as an accountable to wide range or players like investors, stakeholders and shareholders. For a long time the key areas of corporate social responsibility haves been the well-being of the company’s employees and the protection of the environment. The civil society and the surrounding community focus on corporate social responsibility. The idea behind corporate social responsibility is that companies should not operate in isolation and detached from the broader society in their economic processes. This implies that such views as profitability, competition and survival that traditionally drove business missions are slowly losing ground to corporate social responsibility. New drivers have come because of CSR (Paetzold 36). It is necessary to explore some of these drivers and analyze how they affect business enterprises. Drivers pushing business towards corporate social responsibilities The government’s diminishing role in businesses is one great driver. In many jurisdictions, citizens rely on their governments to provide the relevant regulations and legislations for the delivery of environmental and social objectives among the business communities. However, over the foregoing decades, most countries have witnessed the shrinking of their administration resources and distrust of the regulations set aside. Consequently, companies have resorted to carry out their own exploration non-regulatory and voluntary initiatives for restoring their confidence to the communities of operation. Additionally, there have been increasing demands from various players for business enterprises to disclose their modes of operations. Some of these players include the employees, customers, activists, surrounding communities and suppliers (Urip 172). Customers have increasingly developed an interest for accountability and responsibility assumption by business enterprises. It is evident that the companies’ ethical conduct plays a big role in influencing the customer’s purchasing decisions. It is evident that more than 20 per cent of a company’s clients will likely to reward or punish them based on their perception on the company’s social performances. Besides, there has been an increasing pressure from investors. Lately, many investors assess the performance of companies on matters of ethical concerns before making their decisions on whether to work with the company. According to a report by the Social Investment Forum, there were assets worth more than $2 trillion that were invested in business portfolios that had social and environmental responsibility screens in the year 1999. Besides, more than 25 per cent of American customers considered ethical considerations of a company before purchasing or selling stocks with them. This was a survey by the Environics International. The labor market is also very competitive. Nowadays, most qualified and competent employees have increasing focusing on extra benefits beyond their paychecks. In the end, they seek out employers with operating practices and philosophies that coincide with their own doctrines. For a business enterprise to employ and retain these kinds of skilled and competent employees, they are left with no option other than improving their working conditions in terms of corporate social responsibility. Corporate social responsibility is also for the improvement of relations between supplies and business enterprises. This is because stakeholders are increasing developing interests in the management of business affairs. In this regard, many companies resort to take the necessary steps in ensuring that their business partners conduct themselves in a socially responsible manner. In essence, these companies have so far introduced business codes of conduct to guide their suppliers. By so doing, they have ensured that the policies and practices of other business enterprises do not tarnish the reputation of the partnering company (Bueble 69). Benefits of corporate social responsibility The practice of corporate social responsibility by business enterprises has contributed significantly to the business organizations, the surrounding community and the environment. For the business organization, the benefits include enhanced financial performance, the reduction of operating costs, improvement of the business reputation and brand image, increased customer loyalty and sales, greater quality and output and enhanced ability to attract and retain customers. Other benefits for the business include lowering of regulatory oversight, capital access diversification of the workforce, decreased liability, and product safety (Schwartz 101). Corporate social responsibility ensures that they receive charitable contributions from the organization to the community and the public in general. They also benefit from some volunteer programs by the employees of the company besides being assured of safety and good quality of company products. Additionally, the company may get involved in such programs as provision of education, employment and building shelters for members of the community. The environment around which the company operates might receive such benefits as material recycling, durability and functionality of products and greater application of renewable resources. Additionally, the business enterprise might resort to integrate environmental tools to its business plans such as eco-labeling, life-cycle assessment and standards for environmental management. Corporate social responsibility is not only confined to the services and products that a company offers to the environment, communities and stakeholders. It is also concerned with the conduct of the company concerning the established regulations and laws. For instance, a timber company can ensure corporate social responsibility by only retailing or importing timber that has been harvested legally. This implies that they should comply by the government’s penalties and embargoes on timber harvesting to ensure sustainability. Challenge in the implementation of corporate social responsibility Although corporate social responsibility has now become part of the global business agenda, it is still faced with one common challenge. Apparently, most business organizations lack indicators that are more reliable to progress CSR and its strategies. As a result, they conduct their CSR activities in manners, some of which do not conform to the principles of CSR. How to overcome the challenge Businesses across the world need to adapt dialogue and transparency amongst themselves to help them push up other organization’s standards and appear trustworthy as well. Additionally, many more private and public associations should be encouraged to carry out corporate social responsibilities to bring out the aspect of dialogue. There should also be management training on corporate governance for organizations to equip them with CSR strategies. Works Cited Bueble, Elena. corporate social responsibility: csr communication. Mu?nchen: GRIN Verlag, 2009. Print Paetzold, Kolja. Corporate Social Responsibility (Csr): An International Marketing Approach. Hamburg : Diplomica Verlag, 2010. Print Schwartz, Mark S. Corporate Social Responsibility: An Ethical Approach. Peterborough, Ont.: Broadview Pres, 2011. Print Urip, Sri. CSR Strategies: Corporate Social Responsibility for a Competitive Edge in Emerging Markets. New York: John Wiley & Sons, 2010. Print Read More