Corporate Social Responsibility in the Public Sector - Literature review Example

?Corporate Social Responsibility What is Corporate Social Responsibility? From time immemorial, mankind has undertaken many forms of trade. These have flourished into organized forms called businesses. While a successful business is one wherein the businessman makes profit at the end of every year, a high profit is not all that makes a venture successful. Businesses are expected to give back to society – and why not? They get their materials from society. And they sell to society. Hence, they make their profit from society. It is only fair that they learn to give back to the society they are taking so much from. This is what is now termed at Corporate Social Responsibility – an organization’s sense of responsibility to society, whether ecological, economical or social. (Schermerhorn 2010) The term ‘Corporate Social Responsibility’ was coined way back in 1953 by Howard R Bowen in his book ‘Social Responsibilities of the Businessman’. He may as well be considered the Father of Corporate Social Responsibility. (Mhatre 2010) According to the Financial Times Lexicon, Corporate Social Responsibility is a business approach that delivers benefits in threefold – economic, social and environmental, to all the stakeholders and as a result leads to sustainable development. (lexicon.ft.com) Corporate Social Responsibility covers a gamut of activities ranging from human rights and working conditions to environmental health and development of the economy. While Corporate Social Responsibility was initially just considered a fancy term for generosity, times have now changed. Globalization and the ensuing awareness about the deteriorating environment and other social and economic issues around the world have ensured that there is a space for more responsibility that rests with every organization. Whether it is social and economic issues such as poverty and lack of education for children in certain areas of the world or environmental issues such as global warming and the increased carbon footprint, every organization today is now expected to focus on a certain cause and give back to the community. It is not just about generosity or being charitable. It is about a more united world – one wherein organizations are making returns. So why not support those that do not have access to so many privileges? And why not take care of the environment we live in? This is the role that CSR plays today in the daily functioning of an organization. Spreading awareness and the word that there is a need for organizations with power and resources to help those who need it, and the environment we live in, for the benefit of one and all. Hay, Stavens and Vietor (2005) summarise the meaning of Corporate Social Responsibility in their book Environmental Protection and the Social Responsibility of Firms. According to them, CSR is “a consistent pattern in which private firms do more than they are required to, based on laws and regulations governing the environment, worker safety and health and financial contributions in the communities in which they operate.” (Hay, Stavens and Vietor 2005) This definition is perhaps the most comprehensive, expressing not only the variety of functions of Corporate Social Responsibility but also stressing on the fact that the organizations do more than they are just required to. Lord Holme and Richard Watts further adds to this perspective by stating, “Corporate Social Responsibility is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large” (qtd. in Baker 2005). CSR has become a very integral part of every organization large or small, private or public. Schilling and Steensma (2001) is of the opinion that it shows to the public that the organizations are not just ruthless entities that function to make a fatter bottom line, but that they are also humans at the end of the day who care about others and the environment, and make sure that they do things to protect and preserve them. Bigley & Roberts (2001) adds to this perspective by stating, it may just be something as simple as planting saplings every year, or making contributions for the education of the underprivileged, but the reach of CSR touches a large sector of the population. Lasica explores Corporate Social Responsibility initiatives that were successful not only for the institutions but in the eyes of the public as well. These were the ones that made the top three in his opinion: Molson Coors, Tyson Foods and Haagen-Dazs. (Lasica 2010). Molson Coors a popular beer brand from Canada took it up on themselves to educate the drinkers on Responsible Drinking rather than concentrate on alcohol-related events like parties and music concerts. They spread the word about the TaxiGuy Program, to encourage people to call cabs when they had been drinking, and also made sure people got free public transit on New Year’s Eve. (Lasica 2010). A food chain, Tyson Food launched a social media campaign in Austin wherein they would donate 100 pounds of chicken to the Capital Area Food Bank of Texas for every commented that got posted on their blog. (Mhatre 2010). Haagen-Dazs popular makers of premium ice cream, sorbet and frozen yogurt, decided to spread the word of the disappearing bees via their campaign ‘Haagen-Dazs loves Honey Bees’, and thereby took an environmental route. They too included this in their marketing campaign by informing people that honey bees pollinated the ingredients of their famous ice creams, sorbets and frozen yogurt. From the above examples we can see that CSR is being incorporated in organizations’ marketing tactics as well, but does that make it a cheap shot at trying to make the brand popular? One might argue that a brand has to have Corporate Social Responsibility inculcated in its day-to-day functioning, so why not incorporate it in their marketing? It gives them a dual benefit – one of being more respected in the minds of the consumer, and two, they meet their CSR quota. Hay, Stavens and Vietor (2005) toes a optimal stance by stating the best thing is possibly that they market a good cause – and that is what CSR is about anyway – giving back to society and preserving the environment. Corporate Social Responsibility in the Public Sector – Fire and Rescue Services When it comes to the Public Sector, especially services like Fire and Rescue services, the concept of inculcating Corporate Social Responsibility in their day-to-day functioning may seem a little far-fetched. As Griffin (2007) points out after all, the whole purpose of their existence is to help the population. They not only keep a check on the preventive measures that are set up in various places for fire safety, but also ensure that they rush to any place that is in need of rescue from fire accidents. Take for instance Dorset Fire and Rescue Services in UK. Apart from doing their regular duties, they also have dedicated themselves to being socially responsible. They not only ensure health and safety regulations but also take care to address environmental issues. (dorsetfire.co.uk) As a part of their services, Dorset Fire and Rescue Services also offers various services that can help the society be a safer place. This counts towards their corporate social responsibility initiative. For instance, they perform free home safety checks for people that qualify for it, they have monthly fire safety themes (the theme for June is escape routes), national volunteer week and so on (dorsetfire.co.uk). All these activities show just how much this organization participates in the safety of those around them. It is not just a job with the likes of them – it is passion. However, as Dhillon (2003) argues why an organization that is already doing so much to keep the public safe and prevent accidents must be forced to be on the CSR bandwagon. There is a simple answer – the employees. It is accepted that Public Sector Enterprises, especially of this category are already doing their bit for the country, but the whole point of CSR is that the organizations do more than what is necessary. Griffin (2007) adds to this perspective by stating in PSUs for instance, it is essential for the employees to be treated right – whether in case of the remuneration they are getting (for risking their lives in this scenario), to other non-financial factors that help them feel appreciated. All this culminates from the employers. If a CSR policy is in place in public sector undertakings, it will benefit the employees, it will help them feel appreciated and it will give them an opportunity to feel like they are contributing somehow too. (Schilling and Steensma 2001) In this fire and rescue services sector for instance, it is evident that the employees are already helping out people and saving lives. Griffin (2007) provides additional perspective by stating, if they are exposed to being part of other CSR initiatives such as educating people about the various fire hazards and so on, it will give them something apart from their job to take an interest in. This will also prevent fatigue and ensure that the employees are kept interested. Corporate Social Responsibility and the ‘Good Employer’ Today, with the increasing awareness about Corporate Social Responsibility among job seekers, CSR can play a very influential role in employer-employee relations. According to Lokhandwala, gone are the days of ‘pensions, defined benefits and lifelong jobs’. In today’s cut-throat competition, people are paid according to their performance and are constantly on the lookout for new things learn and add to their employability factor. Schwabel (2008) toes the same line by stating, in this scenario, a good CSR initiative will not only create a great brand image for the brand but will also attract passionate, young employees for the job. It shows that the organization does not depend only on their profits but also cares about the society. This goes down really well with the young employees and makes them want to perform better. (Lokhandwala). It also gives employers an opportunity to connect with their employees and sometimes, an opportunity for the employees to connect with one another. For instance, in cases of walkathons and marathons and other such events that are undertaken for a social cause. (Dhillon 2003) A study was conducted, that shows that organizations that indulge in Corporate Social Responsibility, tend to promote Employee Engagement, and therefore have lesser employee turnover, happier employees and more motivated employees. According to Swartz (2012), CSR plays a very important role in these factors. The study shows that employees that are more involved in the CSR activities will say more positive things about the organization and therefore tend to stay with the organization longer. It will also make them feel more involved and make them want to strive to work harder and do more than what is expected of them on a daily basis. (Swartz 2012) Conclusion Corporate Social Responsibility has a lot of benefits. Not just for the environment and those being helped, but for the organization as well. In her interview with Dan Schawbel, Kellie A. McElhaney, professor at UC Berkeley’s Haas School of Business, points out that Corporate Social Responsibility has many advantages such as “reputation enhancement for the organization, attracting new talent, talent retention, brand differentiation, customer loyalty, access to new markets, license to operate in new countries” and so on. (Schawbel 2008). But many businesses don’t consider it as that important. They don’t link it with their business strategy and therefore it doesn’t survive when there is a shortage of funds. This is a horrible thing to do as it not only is disadvantageous to the organization, but to all those that are dependent on it as well. She suggests that the employees must be made an important part of the CSR initiative of an organization so that they feel motivated, and happy that they are a part of something important. She is also of the opinion that in today’s viral world, word spreads like fire. One blog or post or tweet can make or break a company’s reputation. This is a very good reason that companies must ensure they always have a CSR initiative in place. References Baker, M., 2008. Corporate Social Responsibility - What does it mean? , [Online] Available at http://www.mallenbaker.net/csr/CSRfiles/definition.html(Accessed on May 10, 2012) Bigley, GA and Roberts, KH., 2001. The Incident Command System: High reliability organizing for Complex and volatile Task Environments, Academy of Management Journal, Vol. 44, pp.1281-1299 Dhillon, G., 2003. Social Responsibility in the Information Age: Issues and Controversies, Idea Group Inc. dorsetfire.co.uk. Corporate Social Responsibility, [Online] Available at http://www.dorsetfire.co.uk/index.php?ref=417(Accessed on May 10, 2012) dorsetfire.co.uk. Corporate Social Responsibility, [Online] Available at http://www.dorsetfire.co.uk/(Accessed on May 10, 2012) Griffin, A., 2007. New Strategies for Reputation Management, Kogan Page Publishers. Hay, BL., Stavens, RN and Vietor, HK., 2005. Environmental Protection and the Social Responsibility of Firms, Resources for the Future, Washington, DC. Lasica, JD., 2010. 4 examples of Corporate Social Responsibility Done Right, [Online] Available at http://www.socialbrite.org/2010/04/22/4-examples-of-corporate-social- responsibility-done-right/(Accessed on May 10, 2012) lexicon.ft.com. Corporate Social Responsibility (CSR), [Online] Available at http://lexicon.ft.com/Term?term=corporate-social-responsibility--(CSR) (Accessed on May 10, 2012) Lokhandwala, S. HR’s Role in Promoting Corporate Social Responsibility, [Online] Available at http://humanresources.about.com/od/businessmanagement/a/csr_2.htm(Accesse d on May 10, 2012) Mhatre, A. C.S.R., [Online] Available at http://corporatesocialresponsibilities.blogspot.in/(Accessed on May 10, 2012) Schermerhorn, J. R., 2010. Management. John Wiley & Sons Schilling, MA and Steensma, HK., 2001. The Use of Modular Organizational forms: an Industry level Analysis, Academy of Management Journal, Vol. 44, pp.1149-1168 Schwabel, D., 2008. Strong Employer Brands Pay Attention to Corporate Social Responsibility, [Online] Available at http://www.personalbrandingblog.com/strong-employer-brands-pay-attention-to- corporate-social-responsibility/(Accessed on May 10, 2012) Swartz, M., 2012. Corporate Social Responsibility Promotes Employee, [Online] Available at http://hiring.monster.ca/hr/hr-best-practices/workforce-management/employee- retention-strategies/corporate-social-responsibility-canada.aspx(Accessed on May 10, 2012) Read More