Research Question: Is corporate social responsibility just a new trend or is it the modern business 'modus operandi' - Essay Example

Download file to see previous pages The dynamic relationship between society and business, thus become the most critical aspect of larger objective of not only national initiatives but also that of corporate world. Indeed, in the highly vacillating environment of transforming values and socio-economic and political paradigms, business outcome is significantly being impacted by its responsiveness to the elements of change. The emerging new model of competitive business has considerably increased risks and responsibilities of firms that need to become more accountable vis-a-vis micro and macro environmental factors that have impact on the socio-economic development of society. The corporate social responsibility has therefore becomes a vital ingredient of modus operandi of modern business. The paper would be arguing that the various factors have necessitated the need to incorporate ‘social responsibility’ within the broader umbrella of business operation for not only competitive advantage but also to serve the society. 1.1 Historical Background John Stuart Mills1 has broadly described economics as a practical science that is linked to production and distribution of wealth. He justifiably argued that economic decisions and policies help create appropriate platform for distribution channels for the needs and desires of the people. The essential principles of supply and demand are based on the requirements of the people which are met by the businesses. Homans2 believed that rational approach of people’s action is dependent on cost and benefit because ‘no exchange continues unless both parties are making a profit’. Thus, businesses were able to exploit human trait for their individual gain. But through the times, the development of society has also been accompanied by evolving database of knowledge that is accrued over time and utilized through its application in all areas of mutual interest. The advancing technology, changing value system and globalization have become few of the major factors that have introduced new challenges for the people at large. The inter-dependency of resources have become highly crucial paradigms that make it imperative for organizations to become flexible and adopt new strategies to address these emerging set of complex issues and ideas. Indeed, the changing socio-economic and political parameters have shifted the focus of corporate strategy towards the changing format of needs and requirements of people. The tangible and intangible needs of the people have become major compulsions to adopt a systematic approach to issues and desires of the people. Consumers have become key parts of corporate strategies which increasingly incorporate the wider ramifications of changing human behaviour. The inter-relationship of business and society is intrinsically linked to business goals and performance. This is critical factor that makes it necessary for business to integrate socially relevant issues within its operations3. Thus, incorporation of responsibility and accountability towards people who are directly or indirectly being influenced by the business has increasingly become part of business processes. 1.1.1 Need for Corporate Social Responsibility in Organizations In the contemporary environment of industrial and technological revolution, the pace of development across the globe has considerably accelerated. The multidimensional and multifaceted relationship of the masses with the emerging new socio-political factors has ...Download file to see next pagesRead More