Corporate Social Responsibility - Essay Example

s of Corporate Social Responsibility incorporates self-regulation mechanisms into business model for corporations. In other words, the Corporate Social Responsibility (CSR) is a policy perspective whereby a business model monitors its activities and execution mechanisms in such a way that compliance to law, ethics and norms being implicated at international levels is being ensured. Since every firm applies the CSR model distinctively, a few corporations may as well go beyond the compliance mechanisms and incorporate diverse array of policy measures to authentically spread social good. That is, while a few firms engage in CSR activities merely to enhance brand image and go only as far as required for their brand and image to flourish. On the other hand, other firms further their CSR mechanisms beyond the narrow interests of their firms and launch such initiatives or offer support in such a way that positive influence is imperative. Currently, given the international norms and ethical standards, almost all firms have to comply by certain policies which are significant drivers to ensure that these corporations are fulfilling their CSR functions. The sole philosophy behind the popularity of the concept of CSR lies in the impact which is availed via encouraging these firms to take responsibility for the actions of their corporations where the environment as well as the stakeholders is influenced positively (Hunnicut 2009). However, in the true sense CSR may only leave impact if applied in the spirit of how the broad view of CSR tends to imply the concept. Therefore, the paper will aim at explaining how the narrow view is a restrictive approach which may not serve the true purpose behind the application of CSR. Shedding some light on the background of the concept before taking the study forward, it must be highlighted that the CSR has been revolving around the academic circles since the 1960s. During the era, the term was being used merely as a legal cover to acquire moral legitimacy for various acts being deliberated by the firm. Eventually, as more research was funneled into the area, the perspective gained popularity in the context of reaping economic interests attached with CSR. Therefore, academia started advocating for the concept on the basis that firms can`t maximize their profits and acquire a positive position in the business scenario without engaging in CSR activities. However, later in 2000 another study challenged this perspective by utilizing econometric model to explicate how CSR merely has a neutral impact on the firm (Schrek 2009). Yet, the popular claim still stand to be that firms must incorporate CSR into their business models since any ignorance on their part may lead towards loss in revenues. However, contemporary theorists even started questioning the unrealistic and far-fetched expectations which the managers had started associating with the concept, at the same time arguing that the concept is merely a tool at the hand of government corporations to keep tabs on the organizations. Furthermore, in the current century, CSR isn`t merely limited to managerial and administrative perspective; instead, the political imperatives are now being associated with the concept. In other words, in the neo-liberal scenario, CSR is even being viewed as a tool to acquire capitalistic legitimacy and also took the concept in the perspective of corporate power and government regulation debate. However, the significance and application of the concept can`t be underestimated since almost every firm now incorporates CSR as part of the mission statement. This implies that the business ethics models, rather the applied ethics model now ensures that the issues relevant to morality and ethics are now being addressed as part of the organizations` missions. For instance, ISO 26000 may not be considered as the standard application paradigm for CSR around the globe. Currently, the concept is also being incorporated into organizations with little or no interest in commercialism; for instance the educational institutes, which are now also employing CSR as their core policy interest. Therefore, given the evolutionary perspective of the concept of CSR, two distinct views have emerged; both of which hold value to the approach their proponents imply which applying the concept. The narrow approach, which is the first view, is indeed a restrictive approach which functions on the basis of economic model proclaimed by Adam Smith. This view predicates that, as Adam Smith presented with the argument of invisible hand, i.e. the market mechanisms must not be manipulated in any way (positive or negative) and therefore, must be allowed to function on its own. This aspect implies that corporations and business firms exists merely to make investments and reap benefits for the capital and investments they`ve added. Therefore, any business model working on the principles advocated via narrow view of CSR would add social responsibility only to the extent where the legal obligations are being applied and there are no external threats to the firm if it doesn’t apply the relevant CSR initiatives and policies. However, the firm in no way feels responsible for any corporate actions which may positively or negatively impact others. Therefore, being the CEO of a firm where CSR is taken under consideration as the narrow view presents it; the CSR functions would be limited and would only be executed to a certain extent. That is, as long as the regulatory measures are being complied by and the profits aren’t being impacted, the core CSR measures would be ensured. However, no added efforts would be made in this context; also no extra-resources would be funneled to further any such initiatives being taken for social good. However, CSR may be part of public relations or image building for the brand if the business model demands so. Nonetheless, this approach, in my view, has become extinct and no more serves the practical purposes of the holistic nature of business firm which now speaks of innovation and forward thinking. In contrast, the more pragmatic yet appropriate approach which must be applied solely in a business firm is the broader view of CSR. This view was predicated by Keith Davis back in 1975 where he suggested that he business decisions aren’t devoid of social consequences, and thus the firms must take responsibilities of their actions and make efforts to spread social good. In other words, the view suggests that the business firms don’t exist in a bubble or in a vacuum where they don’t have to interact with other actors in the systems. Instead, business firms are dynamic being which form a small part of the larger social systems. Therefore, these firms don`t just have to play their part as economic actors, instead they also have to serve the social purposes. To serve this purpose, the firms need to incorporate CSR not merely as revenue enhancing measure; rather the concept must be applied in its true spirit to ensure that these corporations individually as well as collectively contribute towards adding to the social good. This view further specifies that the firms not only have a social responsibility towards the primary stakeholders directly being impacted by the view, instead the secondary stakeholders who bear the brunt of these corporations indirectly are also subject to the responsibility of these firms. Furthermore as Davis puts forth that since power comes with responsibility, therefore, the business corporations which acquire great power must also then fulfill their social responsibility. Furthermore, the argument proclaimed by the social contract theory also holds significance here. Social contract theory argues that since the society allows these businesses to function and bear the social costs which are being posed by these firms; thus, in turn the business firms must also give something back to the society to fulfill their part of the social contract. Therefore, even in the contemporary times, the broader view of social responsibility not only seems appropriate but also desirable. As a CEO of a company, given the aforementioned arguments, I would incorporate CSR in context to the broad view in an effort to fulfill my part of the social contract. The business model will tend to take into account the perspective that the business model must function in such a way that the firm must be dependent on the society and also, the society is as such in many ways dependent on the functioning of the firm. Furthermore, the broad view will merely add generic CSR policies to the model in order to fulfill formality while ignoring the firm`s own values and principles (Tench & Jones 2014). However, the business model being presented as me being the CEO would also take into account the personality of the firm, where the mission statement and the vision would be designed in such a way that the personal values aren’t being ignored. Therefore, adequate resources would be funneled into the CSR domain of the firm which implies that the CSR policy measures and paradigm would be flexible and subject to moderation depending on the personal character of the firm. Therefore, efforts would be made to adequately apply the CSR model to reap maximum social good out of the resources. Similar to how the vision would be communication to the entire personnel of the firm, the CSR objectives would also be communicated to ensure that the company intends of impacting the society or the community in such a way that the decision making in general always affects the environment positively. Therefore, compliance to the formal rules and generic norms wouldn’t be the goal; instead the goal would be to ensure that the firm is an active social component contributing towards wellbeing of the society instead of merely being an economic actor in the society. In this context, alongside other measures three CSR measures will hold immense significance to the business model of the firm. That is, ensuring equal opportunity for all, encouraging energy saving and environmentally sound policies and also, aiming on enhancing the community relationships management (Tucker & Tocker 2014). This perspective can further be explained by virtue of Kantian theory which will further add philosophical logic to the arguments being posed in favor of the broad view of CSR. The Kant`s ethical views can be elaborated and applied to the business model in an effort to support the broad approach to CSR. Kantian ethical model is presented by the much acclaimed philosopher Immanuel Kant who advocated for the view that human actions must be intrinsically driven by active reasoning of social and moral norms to prove that the greater good lies in acting beyond one`s selfish desires and aims. Therefore, Kantian principles tend to strike a balance between the universal law, ensuring that others are being treated merely as ends (and not as means to achieve another end) and also the good will factor (Altman 2014). The most significant aspect here is how Kant advocated for morals and ethics to be devoid of any such intentions where they are being used to achieve another objective. The narrow approach to CSR tends to utilize moral and ethical principles of CSR merely to escape lawsuits and also to extend their revenues. This principle negates the Kantian view which implies that using the broader view would be interpreted as death of rationality and also, disrespect to beings who deserve to be treated as ends. Therefore, the broad view of CSR tends to keep the Kantian view intact by ensuring that CSR is used as a tool only to serve the needs of the society. Thus, when the business firm would act as a responsible actor functioning in a dynamic society, it would not only have to incorporate CSR as a legal cover, in fact it would also be highly desirable since the firm would be seeing the society as ends which must be justified by all means. Therefore, the obligation to apply CSR in its true spirit and to achieve maximum benefits out of its inherent principles wouldn’t merely be guided by the norms, rather by an urge to be morally sound and ethically superior. Adding pragmatic dimension to CSR, even the most restrictive CEO`s and managerial personnel are now rejecting the narrow view to CSR. Since the stakeholders are the true assets of the firm, not only strategically but also in context to the general image building of the firm. However, the narrow view fails to address the concerns and insecurities of the stakeholders. In contrast, the broad approach to CSR was designed and conceptualized to address the grievances of not only the primary stakeholders but also the secondary stakeholders (Said, Crowther &Amran 2014). Therefore, the firm will tend to satisfy the stakeholders at every tier of the business model in order to develop long term working relationship with these strategic assets to business model. Also, customer good will is attained only while ensuring that the intent and the will of the company are devoid of any sense of irrationality and moral corruption. Therefore, while practically analyzing the CSR policies, there is no doubt while stating that the broad view serves the interests of all stakeholder, thus no other model relying on any other approach may be applied in order to enhance the image and the general good will of the firm. Therefore, having applied the Kantian theory to the CSR principles of the firm, it wouldn’t be an exaggeration to state that applying the CSR principles in the firm should be done merely to serve some other end, instead it must be done to achieve the social good. The sole reason behind the CSR philosophy is to strike a balance between the economic expansion and moral wellbeing in the society which is necessary to ensure that conflicts aren’t arising in the society out of moral corruption. Therefore, it would be imperative to apply the CSR in its true spirit which is only dictated via the broader view of CSR. The good will is a tool which not only serves as a strong Public Relations activist, but also tends to keep the society intact and keep the economy interdependent on society and vice versa. Therefore, basing the CSR on how the consequences would be seems to be a shallow approach which undermines rationality inbuilt to moral and ethical principles. In contrast, the narrow approach to CSR would tend to keep the entire personnel and the firm`s discipline intact since the employees would also realize how significant the principles and spirit of the firm are to the CEO and the board for directors. Thus, not only would be CSR be applied without considering merely the consequences, instead, other aspects of management and administration would also be applied in such a way that the intrinsic value of all tasks would be value. Such a firm would have the will and capacity to further its interests beyond economic value and set precedents crucial to the moral well being of the society, also to enhance the international norms related to CSR. Therefore, there must be no second opinion on the view that broader view of CSR is the one which must be deemed appropriate while the other view must be discarded in the interest of the general interests of the society in the long-run. Works Cited: Altman, M. C. (2011). Kant and applied ethics: The uses and limits of Kants practical philosophy. Malden, MA: Wiley-Blackwell. Hunnicutt, S. (2009). Corporate social responsibility. Detroit, MI: Greenhaven Press. Said, R., Crowther, D., & Amran, A. (2014). Ethics, governance and corporate crime: Challenges and consequences. Bingley, U.K: Emerald. Schreck, P. (2009). The business case for corporate social responsibility: Understanding and measuring economic impacts of corporate social responsibility. Heidelberg: Physica-Verlag. Turker, D., Toker, H., & Altuntas, C. (2014). Contemporary issues in corporate social responsibility. In Tench, R., In Jones, B., & In Sun, W. (2014). Communicating corporate social responsibility: Perspectives and practice. Read More