The Concept of Corporate Social Responsibility - Case Study Example

About ten years ago, many businesses were sceptical about Corporate Social Responsibility (CSR), whereas today CSR is increasingly seen as legitimate business activity. The concept of Corporate Social Responsibility has gained prominence during the contemporary period as there is growing concern that the organisations are supposed to be accountable for the impacts of their operations both socially and environmentally. Thus, it can be seen that in recent years, a number of tourism related organisations have begun to integrate and embed CRS into their mainstream business and operations strategies. Thus, Slack et al (2010) posit to the effect that, "Corporate social responsibility (CRS) is about how business takes account of its economic, social and environmental impacts in the way it operates maximising the benefits and minimising the downsides. It is the voluntary actions that business can take, over and above compliance with minimum legal requirements, to address both its own competitive interests and the interests of wider society." In view of the above statement as well as the economic value of the tourist, this essay seeks to critically evaluate the significance of the concept of CSR with regards to business in the tourism industry. The essay begins by explaining the meaning of the concept of CSR so as to gain a better understanding about how it can positively influence business in the tourism industry. The essay will also evaluate the nature of the tourism industry in order to show a link with the concept of CSR. According to Strydom (2004 p.11), “Social responsibility is the concept that maintains that businesses are part of the larger society in which they exist and are accountable to the society for their operations.” In other words, there is need for the organisations to strike a fine balance between the needs and interests of customers, needs of the environment and the need for businesses to realise their financial goals. This goes hand in hand with the concept of ethics, which is loosely defined as an attempt to differentiate between something good from bad as far as human behaviour is concerned and special attention is given to issues of morality and professional conduct in business (Schultz 2003). In any given organisation, honesty and integrity should be seen as guiding principles. The tourism companies should therefore put measures in place that are meant to ensure that they do something good that does not violate the cultural values of the people living in the areas they will be operating in. On the other hand, tourism is deemed to include any activity concerned with the temporary short-term movement of people to destinations outside the places they normally live and work for leisure purposes (Bennett 1995). As far as tourism industry is concerned, it must be noted that organisations operate in environments characterised by different cultures. Simply put, culture denotes the behaviour of an identifiable group of people living in a particular place. It shapes their way of doing things in their everyday life. The cultural and social environment affects the way people live and behave in several ways in that it shapes their behaviour and the way they conduct themselves in society (McCarthy & Perreault 1993 as cited in Bennet 1995). Thus, tourism businesses which are concerned about the success of their business should also be concerned about the following cultural variables that characterise many tourist destinations around the world: language spoken, type of education the people have, religious beliefs, type of food as well as other social aspects such as marriage, families and roles of women among other things. As going to be explained in detail below, it can be noted that all these factors have a bearing on the way an organisation will operate and thrive in different areas. It is undoubtedly true that every organisation operates in a physical environment with people from diverse cultural backgrounds and these are likely to be affected directly or indirectly by the operations of such organisations. It has been noted that there is need to establish goodwill with the values and norms of any given society the organisation would be operating in as a way of promoting mutual understanding. Thus, CSR entails doing good things to the society in which a tourism organisation would be operating in. It has also been noted that CSR strategy driven by leadership development is very effective in that it will stimulate positive employee performance while at the same time cultivating a sense of trust among the members of the community it will be operating in. Thus, knowing the culture of the local people will facilitate or enhance the different people to come into close contact and do their business on a level of mutual understanding. For tourism business to thrive in a foreign country overseas, the viable strategy that can be used is to give the local people the opportunity to conduct the day to day running of the business while the management will just oversee if the activities will be complying with their expectations. This would empower the local people to take a leading role in spearheading the business since they will have the knowledge about their environment. It also becomes easier for the tourists since they will be dealing with the rightful people who have a lot of information pertaining to the social and cultural systems of the place. By virtue of engaging the services of the local people who have the knowledge about their respective areas, it means that the organisation will be operating within the parameters of corporate social responsibility. The main aim will be to ensure that the tourists will not negatively infiltrate the cultural values of the local people. Corporate social responsibility pays back handsomely if carefully implemented in the tourism industry. A good example can be drawn from the operations of whl.travel, a transnational tourism corporation which is a wholly owned business unit of the WHL Group (Worldhotel-link.com Limited). According to its official website, the WHL Group is a private company incorporated in Hong Kong and is owned and operated by a team from Australia, Brazil, the Czech Republic, Hong Kong, India, South Africa, Switzerland, Syria, USA, Vietnam and Zambia. Having realised that establishing a business especially in emerging markets overseas required knowledge about culture of local people, WHL sought to accommodate local people in all the areas it would operate. The strategy used by WHL is unique in that in all areas it operates in overseas, the booking site of all tourist facilities is owned and operated by the local people. This strategy is effective in that it seeks to empower the local people while at the same time promoting their culture. This greatly enhances cultural exchange among the tourists and the local people. The culture of the host country should be given precedence and priority which is the essence of tourism whereby the tourist can experience a feel of different culture away from home. Through the strategy of CSR, this tourism organisation boasts of success in different tourist destinations. Thus, “a wide range of behaviours are classified under CSR including cause-related marketing, sponsoring charitable events, making charitable donations, utilizing environmental initiatives and demonstrating a commitment to health and safety issues,” (Maignan & Ralston 2002 as cited in Smith 2003). First and foremost, it is every company’s obligation to know that it is operating within a certain social set up with its own norms and values that play a vital role in maintaining the fabric of that society. According to Guarnieri & Kao (2008) there is need to establish goodwill with the values and norms of any given society an organisation would be operating in as a way of promoting mutual understanding. The success of any given company would be determined by its willingness to observe the social norms of the areas it would be operating in. The success of any product would therefore depend on the amount of respect that exists between the two. Randall (1994 p.101) concurs with this position when he said that: “the better the relationship, the more trust that has been built up, the easier it will be to solve the difficult issues which may arise.” Therefore, observing the norms of the society is the foundation of establishing mutual understanding which may lead to the success of whatever product. The culture of the local people adds to the package of tourist attractive features of a given place hence it must retain its originality which adds value to the tourist destination. The strategy used by WHL-travel is advantageous in that the local people know their area intimately and on top of that, these people are also selected to become part of the WHL family which is a growing business. The culture of the organisation also ought to reflect the culture of the people in the host area it will be operating which is a wise marketing strategy given that the majority of the local people will be at liberty to identify with the tourist organisation. In most cases, the local people care about their local community, about their culture and about the local environment. Besides prioritising the interests of the culture of the host people, WHL has in place measures that are meant to accommodate the cultural values of the tourists as well. Due to religious observances, it can be noted that some people do not eat certain kinds of food hence the need to cater for their concern as part of the larger framework of corporate social responsibility. These differences are not only limited to food but they extend to almost every sphere of daily life. Religious beliefs shape the way people behave in many areas and the local people in most areas would not tolerate activities that would threaten the existence of their values that make them different from the other groups of people in the country. Managers across the globe at WHL across the globe are careful in this regard since they know that the organisation can be negatively impacted if it is shunned by the local people the reason why local people are incorporated in the operations of the organisation. If the activities of the organisation are shunned by the local people, then it will defy logic given that most of the tourist markets are culture based. It can be noted that in the event that local people object to certain behaviours, then a tourist company concerned about its future survival will have to comply. By virtue of incorporating local talent, WHL has managed to create a competitive advantage for itself given that the local people have a wealth of knowledge about various cultural artefacts that shape their life. Tour operators drawn from the local pool also contribute to the success of the organisation which is related to the notion of CSR and this is the strategy used by the WHL travel. It is undoubtedly true that an organisation that observes the culture of the local people is better positioned to perform better since tourists will also be concerned with gaining new knowledge about the culture of local people in the host countries. It can be noted that WHL’s prominence can be attributed to its stance on the notion of sustainable tourism. Basically, the concept of sustainability is mainly concerned with preserving the environment for the benefit of the future generations. By any standard, that is being socially responsible given that it is every organisation’s duty and responsibility to ensure that it put measures in place that are meat to ensure that the physical environment is protected. Concern for the environment is one very important aspect that is driven by the notion of sustainable development which posits to the effect that the activities of an organisation should not compromise the future generations to enjoy the same resources. Tourism industry is associated with leisure hence the need to ensure that the human activities will not negatively impact on the environment. However, according to Porter & Kramer (2006), there are mainly three requisites that ought to be taken into consideration as far as CSR and environment are concerned. There is need to ensure that there is willingness among the stakeholders to pay, low transaction costs and there should also be social acceptability for the transactions made. In this particular scenario, it can be noted that the essence of business is not only to reap profits but to promote sustainable development that is meant to be beneficial to the future generations. Over and above, it can be concluded that the concept of Corporate Social Responsibility has gained prominence during the contemporary period as there is growing concern that the organisations are supposed to be accountable for the impacts of their operations both socially and environmentally. The tourism industry has also realised the significance of CSR and most of the organisations operating in this industry have streamlined their activities in order to establish goodwill between their activities and the needs of the society. Basing on the analysis of the WHL case study above, it is undoubtedly true that an organisation that is socially responsible to the society it is operating in is better positioned to perform better since it will be able to create goodwill with the people affected by its operations which can promote the creation of mutual understanding and trust. Bibliography Bennett J.A (1997). Managing tourism services. Pretoria. JLVan Schaik Academic. Bennett A. & George R. (2004), South African Travel and Tourism Cases, Van Schaik, SA Guarnieri, R. & Kao, T. (2008) Leadership and CSR – a Perfect Match, People & Strategy, 2008, Vol. 31 Iss. 3, pp. 34-41. Knights, D. and Willmott, H. (eds.) (2007) Introducing organisational behaviour & management, London: Thomson Learning 658.4 KNI Kotler P. (1999). Kotler on Marketing: How to create, win and dominate Markets. London. Free Press. Porter, M.E. & Kramer, M.R. (2006) Strategy & Society, Harvard Business Review, Vol. 84 Iss. 12, pp. 78-92, Smith, C. 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