StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

The notion of corporate social responsibility of business organizations - Essay Example

Cite this document
Summary
This paper expounds the notion of social responsibility of business organizations. This paper illustrates that corporate social responsibility involves performing roles that go beyond the legal obligations that prevail in a given region…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER94% of users find it useful
The notion of corporate social responsibility of business organizations
Read Text Preview

Extract of sample "The notion of corporate social responsibility of business organizations"

?Running head: Corporate Social Responsibility Corporate Social Responsibility- Minimum Legal Requirement Insert Insert Grade Insert ’s Name March 5, 2012 Corporate Social Responsibility- Minimum Legal Requirement Introduction Various business organizations, ranging from small and medium sized enterprises (SMEs) to large corporate organizations, exist across the globe providing some service or products to their clients. Essentially, the businesses engage in some activity like production of goods or delivery of service to generate some revenue to enhance its sustainable development. This becomes the traditional economic role of the business organization. However, the operations of these business organizations are carried out in some societal context involving the human population and the environment. Thus, there is interrelation and mutual interaction between the company and the society (Fontaine et al, 2006). Besides, the business operations have to be carried out according to legislative provisions in a given country in which the organization operates. The governments and other regulatory agencies have legislation stretching across various social sectors including health, environmental, the fiscal policies, and the monetary policies among many others. Ethical considerations also need to be considered in executing the business operations by an organization. Various individuals affect, and are affected by, the operations of a given organizations. These individuals are termed the stakeholders of the organization (Carroll & Buchholtz, 2008; Fontaine et al, 2006). The interrelation has generated debates among academic scholars on the roles that business organizations need to play in the society (Veludo-de-Oliveira, 2006). The societies have their interests and so do the business organizations. There have been heated debates in the recent years as to whether the organizations only need to pursue their economic objectives or they have some social role to perform in transforming the societies (Veludo-de-Oliveira, 2006). The issue of corporate social responsibility has emerged and developed in the past few decades. Earlier on, most individuals pointed out that the sole responsibility of various business organizations is to maximize the financial returns for their stakeholders and nothing else (Fiorina, 2003). Corporate social responsibility involves performing roles that go beyond the legal obligations that prevail in a given region (Fontaine et al, 2006). It involves the organizations’ role in promoting social and economic developments in the communities while working with the employees, their families, the customers, the shareholders, the community members, and the larger society. This paper expounds the notion of social responsibility of business organizations. The rise of corporate social responsibility for business organizations Even though the notion of corporate social responsibility has come into the brighter limelight in the past three decades, the debates on this issue began as early as the 1950s (Heath & Ni, 2008) when scholars began to question the role of businesses in the society. The evaluation has since extended to non-profit and governmental agencies as well. The main point of concern in CSR is whether the business organizations add any value to the societies in which they operate as they strive to achieve their mission and vision (Heath & Ni, 2008). CSR emerged and developed as a realization by the members of the public that the business organizations should no longer belong to their owners or founders (Carroll & Buchholtz, 2008, p.82). The society has developed various new expectations on the business organizations. The major characterization of corporate social responsibility in a business organization is how the organization involves its stakeholders like the customers, the stockholders, the employees, suppliers, the governments, non-governmental organizations, and international organizations in its business operations and strategy development (Fontaine et al, 2006). Business operations are governed by the legal provisions established in a given country or region. Governments develop, and advocate for compliances with, various policies on health, environment, human rights, labor, financial accountability, and trade as the organizations execute their operations (Organization for Economic Cooperation and Development (OECD), 2012). Organizations also need to make some ethical or moral considerations while dealing with the employees and other stakeholders. This is evidenced in the development of organizational values and culture. These are coupled by the fact that organizations have economic roles of preserving the interests of the shareholders through profit maximization. The corporate social responsibility goes beyond these roles and brings in the fourth, philanthropic, role of organization. It is a section of the larger responsible business conduct (RBC) mainly concerned with the organization’s compliance with the established legal requirements (OECD, 2012). Organizations strive to meet the legal, ethical, and philanthropic expectations and demand bestowed on them by the public in order to survive (Carroll & Buchholtz, 2008). They have to execute their operations under the law and produce products that meet the minimum legal requirements (Carroll, 1991, p.40). CSR involves an integration of social and environmental concern in planning the operations of a business organization. It has been described as the ‘commitment [of an organization] to improve community well-being through discretionary business practices and contribution of corporate resources’ (Kotler & Lee, 2006, p.3). This definition stress the fact that CSR is executed on voluntary basis and it goes beyond the legal obligations as well as the ethical or moral requirements of the work environment in a given business organizations. Besides, the well-being of the community will be ensured if both the human needs and environmental issues are addressed by the organization (Kotler & Lee, 2005). For quite a long period in the past, various aspects of social development in the society were considered the roles of the government and charity organizations. Development objectives in the community were entities different from the major objectives of business organizations (Fiorina, 2003). Despite the earlier observations that business should be concerned with profit maximization, businesses have come to realize that corporate social responsibility should be part of their business strategy and operations (Fontaine et al, 2006). How business exhibit corporate social responsibility In the contemporary business environment, the management of the business organizations constantly receives requests to support various social development initiatives in the society (Kotler and Lee, 2005). The management of the organizations then become under pressure to respond strategically to these calls while pursuing the economic objectives of the organizations. Requests are received that focus on health problems, issues of public safety, community development projects to eradicate poverty, mechanisms to promote education, respecting and protection of the fundamental human rights, as well as environmental protection measures (Kotler & Lee, 2005). Some of these programs fall under the legal requirements. The organizations will be identified by the stakeholders as involving in these roles depending on the contents of their programs. In management of health problems, the organizations can support programs aimed at the prevention and management of HIV/AIDS (Kotler and Lee, 2005). This could also include support for the affected population like the orphaned children. Other interventions would include immunization programs to prevent occurrence or spread of certain diseases in a given community. The organizations can also involve in the management of chronic illnesses like different types of cancer. In ensuring the public safety, the business organizations should be forefront in ensuring road safety by incorporating clearly focused driver programs in its operations (Kotler & Lee, 2005). This is also translated into its work environment. In a production company characterized by highly mechanized system, the employees have to be trained on how to operate the machines as well as how they can be terminated in case of an emergency to avoid further damages. The organizations must ensure that all the tools at the work place are in good condition to avoid cases of accidents. An organization that is out to promote education will be identified by the programs it has towards improving literacy among the employees, and into the community. This can be seen in initiatives like donation of computers and other learning facilities to the learning institutions in the society (Kotler & Lee, 2005). It can also involve provision of free technical training by the organizations to provide these necessarily skills to the members of the society. The corporations can also establish or support programs targeting education of individuals with disability. This can include provision of teaching and learning aids for such and individuals. To understand if an organization has environmental concern, it is necessary to examine the environmental influences of its operations and the measures that it puts in place in order to reduce negative impacts on the environment. An organization will show environmental concern if it has programs to recycle and reuse materials (Kotler & Lee, 2005). This will also be shown by the waste disposal mechanism that is employed by a given organization. Besides, the organization will show concern to the environment if it does not use, or allow for the use of, harmful chemicals. Automobile manufacturer will show this by producing cars that can work on a mixture of bio-fuels and natural fuels. Reduced packaging and reduced use of non-biodegradable package such as plastics will also show some concern on environment. An organization will demonstrate that it has concern for human rights in the recruitment and handling of its employees. The selection process should not be characterized by any form of discrimination or bias based on ethnicity, race, religion, or gender. The employees should be entitled to on-the-job training to help them acquire and cope up with the emerging technological skills. The involvement in other programs like providing food donations to the vulnerable in the community also translates into respecting an individual’s fundamental rights. Finally, organizations can support various schemes to promote economic development in the societies. The organizations can provide low-interests loans to the members of the society for housing scheme and other investments (Kotler & Lee). They can also fund youth development programs or women groups. All these initiatives indicate that an organization has some corporate social responsibility. The organizations can support the above programs through cash donations, provision of grants (for some research and development programs) or through in-kind donations as in the case of donating learning facilities for individuals with disabilities (Kotler & Lee, 2005). Organizations in the communication industry, i.e. the media, can offer their free services like publicity on human rights and public safety, free advertisement of some initiative (such as immunization program scheduled in some area) or through some other promotional sponsorships. The organizations can also volunteer some of their employees to provide some free service or give technical expertise. The organizations can provide these supports independently or in partnership with other organizations depending on their capabilities. It has to be stressed that the fact that a company pursues it economic goals may not necessarily hinder achievement of social responsibilities. It has been pointed out that ‘companies generating cash flows, producing goods, or maximizing stock values may also promote social welfare. If companies exist to serve the society as a whole, it is expected that they pursue economic profitability and have social responsibilities as well’ (Veludo-de-Oliveira, 2006, p.26). This state is, however, difficult to realize in certain instances. The businesses should be profitable in order to allow sustainable operations. The organization should be able to settle its debts, pay the employees, and set aside other resources for continued research and developments. The employees in a given organization will perform effectively to maximize the company output if there are proper incentives and they are satisfied with the working conditions at the organization. These can be achieved through profit maximization. Bankrupt organizations are likely to create other social problems (Veludo-de-Oliveira, 2006). CSR as a strategic positioning tool Corporate Social Responsibility has become an important management tool in the recent past. The customers are among the important stakeholders of any business organizations so that they need much attention from the management of the organizations. In the recent years, business organizations seem to have developed awareness of the importance of listening and paying attention to the customers, and addressing their needs accordingly (Veludo-de-Oliveira, 2006). The customers show varied behaviors when it comes to purchase and use of certain products and services. They always perform some evaluation on the different products available in the market before deciding on which products are best in serving their needs (Veludo-de-Oliveira, 2006). The organizations need to be aware of these changing patterns and develop products that meet customer needs and the legal requirements. Since the customers will always perform a comparative analysis of products and brands to influence purchase decision, the role of social responsibility as a strategy tool emerges. Organizations that are to survive attempts to show the customers that they do understand and they are ready to respond, to their needs. The organizations strive to position themselves above others by developing positive institutional image of their company in the minds of the customers. The organizations also struggle to develop strong positive relationship with the other stakeholders through different strategies. They are under pressure to engage in the social activities and display to the clients their involvement in these activities. As such, they have shown increasing trends towards philanthropic programs to give back to the communities. The kind of good image that the customers will develop of the companies that have chosen to give back to the society will have positive impacts on the operations of the organization. Previous researches have indicated that there is a strong relationship between the customer’s perception of an organization and the product responses (Veludo-de-Oliveira, 2006). The knowledge that the customers have about the organization will affect how they react to its products. Organizations with positive CSR associations will have their products received positively in the market unlike the organizations that do not involve in these social responsibilities. The development of positive image of an organization cannot be just achieved by a mere acceptance by the organizations that they have social responsibilities. Rather, it has to be put into action and shown to the customers and others stakeholders. For instance, a hotel or restaurant will demonstrate its environmental concern through its established mechanism of proper waste disposal. Moreover, the business organizations need not to advertise to the stakeholders their involvement in corporate social responsibilities (Veludo-de-Oliveira, 2006). The stakeholders will get to know about them as long as they have been put into place. The positive image that needs to be developed by the customers cannot be developed within a short period. It develops over time. The companies rely on resources from the stakeholders like the suppliers in order to have sustainable development. The suppliers will develop good relationship with the company if it (the company) operates according to the rules and values that have been developed and recognized in the society (Fontaine et al, 2006). The suppliers will develop good will of working with the organization if it does not appear to be out to exploit the environmental resources all to its benefit. Similarly, the employees are important stakeholders in an organization since their productivity is reflected onto the overall performance of the organization. Researches have indicated that employees also prefer to work in socially responsible organizations (Fontaine et al, 2006). They will be satisfied with an organization that considers their (employees’) needs and extend to consider the needs of the families and the entire society. The researches also indicate that customers will prefer products that are produced in a work environment that takes into account the fundamental human rights (Fontaine et al, 2006). With these observations, positive association with corporate social responsibility becomes a good strategic tool that enables an organization to position itself well above the competitors. In as much the legal provisions can call for environmental management initiatives and proper working conditions to the employees, the extended measures that an organization takes towards these directions will be of long-term benefit to the organization. The measures may seem costly under unrealistic at the beginning, but this should not demoralize the management. Nonetheless, the concept of corporate social responsibility has not been received uniformly as an effective role of business organizations. While some theorists support the social responsibilities of businesses, others (critics of CSR) observe that corporate social responsibility distract the economic roles of a given business entity (Heath & Ni, 2003). The critics point out that involving in corporate social responsibilities may make the organization unable to have sustainable development if it has excessive payback to the society. The shareholders may decide to withdraw their stake in the investment if it has much focus on the needs of the members of the society. This is detrimental to the survival and future operations of the business organization. Conclusion Corporate social responsibility has become part of the roles of the business organizations as the expectation of the society change from the earlier perceptions. Members of the society have legal, ethical, as well as philanthropic expectations for the business expectations as opposed to the earlier case in which businesses belonged to the owners and founders. Understanding this position of the society and responding accordingly will enable the business organization to develop good image in the society to gain competitive advantage. An organization will demonstrate its corporate social responsibility through its operations, the products offered or the services delivered. The products and services as well as the operations should follow the legal provisions. An automobile company will demonstrate its commitment to environmental management through conducting research and developing models that use bio-fuels as opposed to the use of traditional fuels. Reference List Carroll, A., 1991. The Pyramid of Corporate Social Responsibility: Toward the Moral Management of Organizational Stakeholders. Business Horizons. (Online). Available at: http://cf.linnbenton.edu/bcs/bm/gusdorm/upload/Pyramid%20of%20Social%20Responsibility.pdf [Accessed March 5, 2012]. Carroll, A & Buchholtz, A., 2008. Business and Society: Ethics and Stakeholder Management. South-Western: Cengage learning. Fiorina, C., 2003. Hewlett- Packard. Business for Social Responsibility Annual Conference, Los Angeles, California. (Online). Available at: http://www.hp.com/hpinfo/execteam/speeches/fiorina/bsr2003.html [Accessed March 5, 2012]. Fontaine, C. et al. 2006. The Stakeholder Theory of the MNC. (Online). Available at: http://www.edalys.fr/documents/Stakeholders%20theory.pdf [Accessed March 5, 2012]. Heath, R., & Ni, L., 2008. Corporate Social Responsibility. University of Houston. (Online). Available at http://www.instituteforpr.org/topics/corporate-social-responsibility/ [Accessed March 5, 2012] Kotler, P., & Lee, N., 2005. Corporate Social Responsibility: Doing the Most Good for Your Company and Your Cause. New Jersey: John Wiley and Sons. Organization for Economic Cooperation and Development. 2012. Promoting responsible business conduct. (Online). Available at: http://www.oecd.org/document/41/0,3746,en_39048427_39049437_41162793_1_1_1_1,00.html [Accessed March 5, 2012]. Veludo-de-Oliveira, T., 2006. Society versus Business Organization: The Strategic Role of Marketing. Electronic Journal of Business Ethics and Organization, 11(1). (Online). Available at: http://ejbo.jyu.fi/pdf/ejbo_vol11_no1_pages_26-29.pdf [Accessed March 5, 2012]. Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“The notion of corporate social responsibility of business Essay”, n.d.)
Retrieved from https://studentshare.org/law/1395787-the-notion-of-corporate-social-responsibility-of-business-organizations
(The Notion of Corporate Social Responsibility of Business Essay)
https://studentshare.org/law/1395787-the-notion-of-corporate-social-responsibility-of-business-organizations.
“The Notion of Corporate Social Responsibility of Business Essay”, n.d. https://studentshare.org/law/1395787-the-notion-of-corporate-social-responsibility-of-business-organizations.
  • Cited: 0 times

CHECK THESE SAMPLES OF The notion of corporate social responsibility of business organizations

Corporate Social Responsibility

nbsp; Therefore there is a need for good corporate social responsibility toward the customer given the fact that the organization products or services are made for the consumption of the customers/public and in the even whereby the customer fails to consume the products, there is the danger of the organization becoming irrelevant or redundant because it would no longer need to carry out any more production.... It also emerged that the process of winning customers is quite an expensive one and therefore losing the customers by failing to adhere to corporate social responsibility requirements is a major undoing for the organizations considering the fact that organizations must need to be genuinely concerned about the well being and the wellness of the customers....
8 Pages (2000 words) Assignment

Corporate Social Responsibility: Pressures

nbsp; The field of corporate social responsibility is now a fundamental one in the study of management and business.... nbsp; In short, the traditional notions of corporate social responsibility have been expanded and continue to expand.... In short, the traditional notions of corporate social responsibility have been expanded and continue to expand.... These basic features, compliance with the law and philanthropy, constituted the traditional notions of corporate social responsibility....
6 Pages (1500 words) Essay

The Role of Organizational Corporate Social Responsibility in Business Strategy

This paper aims to provide a more detailed analysis of the role CSR plays in H&M business strategy and to evaluate how participation of H&M in BTI and OCI impact the business and strategic direction of the Swedish fashion brand.... &M placed sustainability at the centre of its business strategy as the company's management has early recognised its importance and potential financial, environmental and social benefits.... The company focuses on several major areas, including: ethical sourcing, ethical business practices, reduction of negative environmental impact, resource management, and local communities (H&M Conscious Actions Sustainability Report, 2014)....
11 Pages (2750 words) Essay

The Corporate Social Responsibility

The student-led seminars were a great time of learning whereby a lot of corporate social responsibility content was learnt.... From the essay "The corporate social responsibility" it is clear that all stakeholders are equally important to an organization and therefore the corporate social responsibility department must treat them indiscriminately for the sake of the organization's survival.... Therefore there is a need for good corporate social responsibility toward the customer given the fact that the organization products or services are made for the consumption of the customers/public and in the even whereby the customer fails to consume the products, there is the danger of the organisation becoming irrelevant or redundant because it would no longer need to carry out any more production....
7 Pages (1750 words) Essay

Ecological Modernization and Corporate Social Responsibility

The paper "Ecological Modernization and corporate social responsibility" highlights that there is no doubt that a corporation's legitimacy and reputation depends largely on its social conscience since it interacts with society.... hellip; corporate social responsibility can be best understood by reference to the three words contained in the actual phrase, “corporate, social and responsibility.... This paper argues that while ecological modernization can serve as an equivalent paradigm for corporate social responsibility if it can incorporate a strategy that serves the interest of all stakeholders....
16 Pages (4000 words) Research Paper

Corporate Social Responsibility of Zain Mobile Communications Company

d) has mentioned that corporate social responsibility (CSR) is one way of expressing the obligation of an organization towards the community where it works.... Crane et al (2009) have mentioned that CSR has appeared in history along with the evolution of business activities itself.... They have also pointed out that the meaning of business and the relevance of it to the social development etc were discussed at the beginning of business history itself2....
10 Pages (2500 words) Case Study

Corporate Social Responsibility and Social Entrepreneurship

However, the contemporary notion of corporate social responsibility is a result of sweeping changes, which started during the 1950s.... This paper "corporate social responsibility and Social Entrepreneurship" focuses on the fact that the responsibility managers and directors of corporations are to uphold the benefit and interest of the shareholders, that responsibility is to conduct the business in accordance with their desires.... In light of this fundamental change, this paper will look into corporate social responsibility and will undertake a critical analysis corporate social responsibility in theory and in action....
20 Pages (5000 words) Research Paper

Corporate Social Responsibility

This work "corporate social responsibility" describes theories of CRS that most business organizations apply in creating the image of a socially-oriented firm.... corporate social responsibility has recently become the foremost element of strategic policy of most corporates.... In most cases, business organizations do it on voluntary basis since they feel it is part of their responsibility to ensure that the interest of the employees, their families, and the entire society is well-taken-care-of (Sims, 2003, p....
9 Pages (2250 words) Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us