Corporate Social Responsibility and Financial Performance - Essay Example

SUSTAINABILITY Report Suzie Ormand November 25, Sustainability Most organizations emphasize on sustainability as one of their core features; however, establishing the depth of sustainability by these corporations is always hectic as they are very limited and sometimes, no utter way for achieving this (Elkington 2004). Essentially sustainability revolves around many factors of a company i.e. corporate social responsibility, a successful brand and performance development and management. Concurrently, this report is an utter analysis of the above factors, providing information on them concerning how neglecting any of them affects the sustainability of a company. Moreover, the findings are a comprehensive scrutiny on the various facets of the company that the manager should know to make decisions that will facilitate sustainability. 1. Corporate Social Responsibility Corporate social responsibilities define the lawful actions that extend some social goodness to the community, business environment and employees. (Palmer, 2012) Programs in social responsibility include actions to make a better environment for the society and stakeholder’s lives in an organization. Most companies are not aware of the accountability factor hence they do not make any significant impact to the societies; essentially, this is because they lack the right strategies and procedures to implement in their systems (Palmer 2012). Most companies fail at achieving sustainability because they lack the necessary curriculums; however, they are those that establish these curriculums but do not effectively implement them. CSR curriculums facilitate meeting of customer’s needs by companies; they improve their esteem by making them feel more worth in the society. These programs also act to the corporation’s advantage since they attract a great number of customers hence increasing the sales. In cases of Insurance policy companies, they increase the number of people that want to be in their hands and these also motivates the company to continue offering better services using the social responsibility programs (Annabel & Deanne, 2011). Social responsibilities act as guidance to how employees and stakeholders behave and conduct themselves in the work place. CSR, merely as laws, facilitate employees’ actions, as individuals or as a group, in different situations like when providing services to customers, when handling corporation assets and when required to execute business-based tasks. Failure to establish the different aspects related to corporate social responsibility is the reason why top-level managers for most companies do not succeed in using this as a facilitator of sustainability; moreover, the biggest mistake for most companies is failing to integrate the set objective in the companies CSR initiatives. 2. Successful Brand Significantly, many factors determine the success of a brand in the market, a factor that most companies know and put a lot in; however, most fail to understand that these factors should be long-term because this is the only way to attain sustainability. There are different theories that contradict the whole idea of a successful brand based on beliefs, corporate measures and quality of the brand; resultantly, this is a major issue for all companies and very few are able to counter it. Successful products build on the success of the brand. In most given situations, the product of a particular company or organization classifies, not only the brand itself but also the company’s title and its overall impact in the market (Andrus 2013). A successful product determines the relationship between a company and, the consumer, employees, associates and stakeholders. Considerably, a successful brand acts as a catalyst and strong bond for the company’s relationships resulting to high sales. The high sales and the strong bond will increase the interaction, which is a good factor of interaction. Successful branding entails associating the product with aspects reflecting on the customers’ needs and prospects. For most companies, this notion bases on how consumers think, feel, perceive or picture a certain product, and they experiment this aspect. Typically, this is the true definition of meeting a customer’s needs in most business perspectives; resolutely, the explanation clearly implicates that successful brands depend with the success of a product. Concomitantly, this is an aspect that most companies overlook or handle lightly depending on other factors concerning the set business plans and strategies. Nonetheless, most great organizations argue that a person’s experience on a certain brand is more of the person’s perception on that brand, and the product itself does not matter at all but other aspects such as reputation and the management play key roles (Andrus 2013). Largely, there is some truth to this notion since mindset of a customer really matters in relation to a successful brand and product with variance in information gathered and expectations in dissimilar situations. For any company, whether a startup or developed, this is a core challenge especially due to the variations in the different markets; in fact, this is the reason why most people focus on multiple facets for the development of their brand, acting as distractions for the core aspect, the product. Principally, there is no way that a company can have sustainability if it is failing in the market due to poor product quality and other related challenges. 3. Performance Development and Management Today, a limited number of managers give the required attention to performance management and development, one of the contributing factors to most of the economic downfalls. Companies fail in making sure that they keenly evaluate performance between relevant and fair measures putting most of their focus and efforts on essential aspects of any business (Annabel & Deanne, 2011). However, the few that consider this aspect apply strategies that focus on ensuring that managing the performance conveys in an environment where the evolution of numbers and effect on organizational brand and innovation bases on the ways of the business success. Concurrently, there are many challenges an organization may incur in putting it into place a performance and reward strategy using knowledge of the results past case studies and theories from different specialists on the field but mostly on human resources. Currently, the nature of work is altering with diverse organizations and corporations operating in more of a specialized network that is also flexible and natural; the frequency of strategic partnering arrangements between organizations increasing the need for management relationships beyond the organization, a factor considered by just a few companies. On the other hand, reward systems are also a critical part of any organizations design and how well they are compatible with the rest of the systems has an equal effect on to what extent they will be effectual and on the quality of life that people will experience in the organization. There have been new reward systems practices becoming popular over the years in order to side with reward systems with significant changes occurring in the design and management of organizations (Annabel & Deanne, 2011). Considerably, management begins by understanding the role of reward systems in organizations in correspondence to how its systems are designed after which significant focus is put into fitting reward systems and the high involvement of approaches to how the organization is designed and finally, consider the significance of pay system in large scale organization change efforts. 4. Summary and Conclusion Corporate social responsibility, a successful brand and performance management and development are the chief factors that express the environmental, social and economic aspects that attain sustainability of a company. In the recent past, failure of some companies has been because one of these factors i.e. Research in Motion, Blackberry manufacturer, could not keep up with the competition due to the poor quality of products. On the other hand, leading international companies such as Coca Cola have all the above factors incorporated in their business plans; moreover, they have resolutions set to improve the same the following years. Naturally, sustainability is all about creating a balance between the environments, society and economy (see figure 1). Figure 1: Environmental, Economic and Social Aspects of Sustainability Speech 1. Introduction Fellow scholars thank you for the warm welcome. It is an honor to be here and the topic of discussion today is sustainability. I am going to evaluate this as a major issue today and discussing on hindrances relative to social corporate responsibility, successful brand and performance management and development. Additionally, part of the analysis will entail a few probable strategies that companies neglect as sustainability initiatives. Largely, the information used is from journals, reviews, scholarly articles and annual reports from companies. Definitely, most of you know that sustainability is one of the core issues that business leaders have a hard time addressing. Very few companies have the capability of sustaining their influence in the market; in fact, most of them flop after great achievements, and it is all because they ignore some of the critical aspects. Focusing on one or two aspects of the business is unorthodox because after a certain time something will go wrong somewhere. Relatively, leaders of the reigning companies agree that in order for sustainability, a company has to go all ways i.e. environment, society and economy. Naturally, most people put more effort on the economic aspect due to the profits. This might work on other aspects but there is no way that it will ensure sustainability. 2. Discussion Firstly, we will explore two popular companies that have been in the spotlight for some time. The reviews of these companies base on development, downfall and their current position in the different markets. The findings form a platform for more information on the issue of sustainability. Aflac’s Social Responsibility Policies Aflac is a number one company recognized internationally for its good reputation in the business world of insurance. This company has accomplished a lot which act as a revelation to how dedicated the company is in making a difference in the lives of its customers, the world and its employees. Aflac focuses on three key areas; compassion, multiplicity and the ability to uphold its purpose, it is dedicated to looking after its own congregation and is mainly concerned with its miscellaneous work force. The company has been dedicated to endorsing a balance between work and family, Aflac’s staff holds a higher percentage of women in which half of them are in the supervisory level. Over the years, Aflac is among the top companies in the world under different ranks; Dow Jones Sustainability Index (DJSI) North America, Fortune’s Best Companies to Work For and World’s Most Ethical Companies. Some of the factors that contributed to its success are akin to its recent creation; a recycling program, which will include aluminum, plastic, cardboard, batteries and office paper. Ethisphere is an institute that is loyal to creating the best performances in business ethics, anti-corruption and sustainability, corporate social responsibilities. It yearly identifies companies worldwide that depict an obligation to ethical leadership, conformity practices and social responsibility. Aflac has been the solitary insurance company emerging on the list annually for a long period. Brigham, the director of Ethisphere institute says that unlike most companies, Aflac recognizes the significant role that ethical practices play in brand character, which is the most precious advantage for any corporation; its goes on further in executing decent business practices and schemes that contribute to the company’s success, community’s benefit and high ethical standards in the industry. Research in Motion’s Superciliousness In 2007, Blackberry was on top of its game being in the class of the smart phone industry commanding a large and supposedly loyal following. Things started to unravel when the I-phone was introduced to the world being much far better than anything that Blackberry had to offer hence leading to the Research in Motion falling behind the competition especially when it came to specs and the different features. Blackberry began to react to the competition in late 2007 and 2008 rather than leading the competition to react to them. Later on that year, the company had a project of producing a tablet, The Playbook, which most people looked forward to experimenting; however, due to unknown reasons the launching had a delay. During this time, the company had a series of misfortunes plus all its mergers seemed to go south making the completion of project ‘Play Book’ very hard for it. Nonetheless, the core factor that led to all these failures and even more challenges is the process that the company used to make decisions, where they seemed undecided on what they wanted. There are also instances where the company seemed to be desperate especially when they changed the price of the Play Book, and pushing out some of the features that they were to include when they were in agreement with Sprint. Concurrently, 2007 marked the beginning of an executive exodus where the Chief marketing officer left in March, the COO retired in July after a long medical leave and then there was the president for digital marketing and media who went to Samsung Mobile. This was not the end since after a while the senior product manager also joined Samsung, the head of developer relations and vice president of global alliances left. Additionally, by the end of 2011, the stock of the company had lost nearly 75 percent of its value to an extent of dipping below book value and people said the only solution was RIM selling as scrap, which led to most of the shareholders asking an alteration in the management. Comparatively, Aflac and Research in Motion have dominated their markets and the economy at a certain point, but today they stand at different points. Aflac has put in a lot to succeed through the different sustainability strategies I cannot fail to acknowledge that the company is very strict in ethical policies, CSR and change management. RIM has experienced one of the core downfalls since other companies made great advancements. I remember that there is a time that the Blackberry was the fanciest and most established business phone, but today, the question on everyone’s mind is, what happened? I believe the analysis of these two companies shows that sustainability is an issue most organizations overlook until the minute things are irreversible. Today, this is the biggest task for managers of any corporation, and even for the flourishing companies such as Aflac, challenges continue to multiply. According to my understanding from the analysis, I am concerned about this because most of the companies are unable to incorporate initiatives involving social corporate responsibility, a successful brand and performance management/development in one strategic business plan. All the same, there are those that consider these aspects but they still experience challenges during the implementation. Challenges in Implementation of a Comprehensive Sustainability Strategy Implementation is the core challenge of the strategic planning process since it involves attaining the objectives set out in the strategic plan while staying watchful and supple to new prospects as they open up. Most of the companies implement strategic plans even without making sure that they are robust. Robust strategies are realistic and solid in all facets concerning the overall sustainability. Contrary, some of the strategies fit the job but the management makes mistakes during implementation hence increasing the underlying conflicts and disrupts the flow of information. I do not have to tell you how serious that is, the consequences are obvious. Another common challenge is the company management overlooking challenges from previous strategies. Once you do not include these problems in a long-term strategic plan, failure is an assurance because eventually they will start haunting the progress of the company. Some of the common mistakes that germinate from this include: Company management discarding the strategic plan The strategic plan is not communicated to the front-line employees Managers being tied up in the day-to-day operating problems that they lose sight of the long-term strategic goals The strategic plan is treated as a separate thing The management recoils from making tough choices that the strategic plan may call for Relatively, very few companies involve the stakeholders in the development of sustainability strategic plans. This is the biggest mistake you can ever make because when things start to fall apart, they are the first people you will confront to solve the challenges. Just let them in during the development, as it will make things easier during the implementation and coming up with solutions for the different challenges. Communication is an important factor in any setting, in sustainability; it acts as a bridge for the employee to ‘buy in’ and creates a better comprehension of the organization’s strategic goals and objectives. Most corporate leaders focus on the content of the strategic change whereas the key aspects are always on how to manage the strategic change. Personally, I would also encourage companies to put in place tools that will give information on the implementation of strategic plans. Since the matter at hand is sustainability, it also essential that you consider some of these aspects. They say that prevention is better than cure. Once you have an idea on the advancement of the plan nothing will stop you from countering some of these challenges before they affect the company. On to my last point of discussion today, I know once you hear of a long-term sustainability strategy, many questions cross your mind. Well, the long-term strategy does not necessarily mean that the development ends upon implementation; the plan requires regular updates and changes. This will make the sustainability strategy more effectual because it adapts to the different variations as time passes. In conclusion, strategic sustainability planning is crucial to profitable business growth, but most companies and organizations typically become conscious only a little bit above half of their business strategy’s value in form of potential because of the challenges and downfalls in strategic planning and implementation. In other words, the opportunity value of getting your strategic plan execution right is huge. All the same, the best possible way that a company can be able to overcome these challenges is by understanding them and ensuring that they follow the long-term strategic plan all the way. Comprehensive sustainability programs funnel managers, which help them in effectiveness and they do not assume their roles as leaders. As a corporate leader, you should rate yourself using various characteristics of ethical leadership like decency and equality, sharing of power and clarification of their roles, which will promote effectiveness and optimism. Thank you for the attention, and keep in mind that sustainability is all about keeping in line with the corporate forces, or at least refrain from trying to defy them. Bibliography Annabel, H &Deanne, N (2008) Ethical and Despotic leadership, relationships with leaders’ social responsibility, top management team effectiveness and subordinates’ optimism: A multi method study: The Leadership Quarterly. Vol. 19(3), pp.297 – 311 Andrus, P (2013) Secrets of Successful Brands: Entrepreneur. Viewed November 26, 2014 http://www.entrepreneur.com/article/226094 Palmer, H (2012) Corporate Social Responsibility and Financial Performance: Does it pay To Be Good? CMC Senior Theses Paper: No.529 Elkington, J (2004) Towards the Sustainable Corporation- Win-Win-Win Business Strategies for Sustainable Development: California Management Review, 36 (2): 90–100 Read More