Csr : A Global Compact Study

Every organized company worldwide should have among its structure, one planning and coordination division in which social and business goals are integrated. Corporate social responsibility (CSR) programs are necessary for commercial business as an element of risk management and represent an outstanding mechanism for the stakeholders to identify weaknesses when their own actions or others conduct in its operating environment generate social risk. (Kytle and Ruggie 2005).

One of the most dominating concepts of business reporting is Corporate Social Responsibility. It has become mandatory for every business to include a policy with regards to CSR and produce a detailed report with regards to its activities. CSR can be defined as the relationship between a corporate company and the society in which the company operates. The concept of CSR became famous during the late 1960’s and since then it has helped corporations to sustain itself in the market.

Corporate Social Responsibility (CSR) is something that affects all companies and should be an active factor in the company’s decision making. It is something all corporations need to care about. CSR is when business’ or corporations take part in an initiative or campaign for a cause that will benefit society and/or in some way make the world a better place (Taylor, 2015). Initially, Corporate Social Responsibility started to take shape around the 1950’s, but some say that it dates all the way back to the 1800s, the idea of CSR was seen (Carroll, 2007). One may think that because it is dated so long ago, it doesn’t have an important impact today nevertheless, it is proven that Corporate Social Responsibility is a pathway for entities to self benefit as they are in the process of benefitting society.

Even though customers are a major key to success of any business, limiting CSR practices to an external group of stakeholder is insufficient. From the customers’ side, the focus is “on the corporate brand and its societal relationships with external constituencies.” (Lacey, Hensel 316). It is undeniable that implementation of CSR can attract the customers and lead them to be a significant are source of a financial gain. That is because CSR changes the way consumers behave in the market and alter their beliefs toward the company standards.” (Lacey, Hensel 316). Nevertheless, extensive focus on the social gains may cause the business to suffer financially. If that happened, the case is considered to be a failure of executing CSR. Again, this is a result of shifting all the business gears to benefit a sole group the stakeholders.

In this book, Clane et al (2008) states why companies need the CSR strategy in many areas of their activity: increased social awareness, as a result of global warming; major disasters; social consciousness and media pressure. The book explores each of these factors and analyses how a business can overcome its weakness and create opportunities. This source explains the overall advantages to a business and it details the benefits of running a business. Furthermore, this source is highly influenced by a business’s social performance, purpose and adherence with Corporate Social Responsibility.

The benefit to business of good Corporate Social Responsibility is difficult to quantify as it varies depending on the nature of the enterprise. Some scholars believe that there is a business justification for CSR. That is, what is good for the environment and society will be good for company profitability. And studies have shown a slightly positive correlation between CSR and financial gain (Steiner and Steiner, 2006). However, as Freidmanism claims, the first responsibility of business is to make enough profit to cover the costs for the future. If this social responsibility is not met, no other responsibilities can be (Hargreaves, 2006). Therefore it is critical that CSR activities are included in strategy formulation and that the level of resources devoted to CSR is determined like any other strategy – through cost/benefit analysis. Corporations will not throw money away…they need to see it

1. It is hard for companies to communicate their efforts in CSR to shareholders and investors. Although companies have progressed from only 20% of public companies publishing CSR reports to 72% from 2011 to 2013, there are still no universal standards established for reporting CSR information. Therefore, even the best CSR efforts can lose their value simply because the efforts are not communicated to users of financial statements. This is also in part due to CSR efforts being ill-defined. While some CSR ideas are universal many of the aspects of CSR are industry specific and hard to translate into meaningful disclosures for interested parties.

Current approaches to CSR are fragmented and/or disconnected from business goals. Many firms still consider CSR as another generic public relations problem in which media campaigns and CSR reports are used to paint the company as a positive ethical, social and or environmental advocator and supporter. For example, the annual reports discuss a firm’s sensitivities to CSR issues, but completely lack the entire story and offer no further forward commitments from the firm. Further, the ratings and rankings measurements are self-appointed by the firm, not always accurate to validate the work and direct impact to what they are measuring, and the criteria base varies widely and weighed differently in the final scoring. Worst of all the data lacks impartial auditors for validating the data to ensure the ratings have been accurately met, and data is statistically significant and a good proxy for what it is supposed to reflect. This has resulted in reactive initiatives designed to appease vocal

CSR is how companies control their business processes to provide an overall positive impact on society. There are many factors that determine how socially responsible a business is, but alongside these are the benefits and costs relating to the level of CSR produced in this essay, I will be analysing companies from the retail industry and a car manufacturer to discuss the potential costs and benefits to both business and their stakeholders of CSR.

Whether CSR costs a company money or earns them money can be a challenging topic to argue. There are many factors that are considered when assessing a company’s long term financial performance and its relationship between the company’s CSR and their revenue. These factors include a company’s CSP (Corporate Social Performance, or the measure of CSR), size, risk taken, economic scaling, and competition. However, there are several additional variables that are commonly forgotten and must be considered when calculating the effect a company’s CSR has on their financial situation. R&D for example has a major impact on a company’s long term economic performance, as it leads to improved knowledge and increased ingenuity on the company’s operations and products. Positive returns on R&D investments can lead to increased shareholder returns and increased profits.

The popularity of CSR has grown substantially in the last couple of decades. Many people may have grown skeptical of business in the wake of corporate scandals such as Enron, Tyco, and WorldCom followed by the sub-prime mortgage market, which have all gained large amounts of negative publicity. Stakeholders are more aware of the performance of companies along a broader set of metrics that portray the company’s operations in a more comprehensive manner that provides information about social performances and environmental performances. Much of the concept of corporate sustainability is rooted in the notion of sustainable development with can be defined as the ability to meet the needs of the current population without compromising the ability of future generations to

Microsoft, Walt Disney, Google, BMW, Daimler, Sony, Intel, Volkswagen, Apple and Nestle are probably big company names that many have heard of. They are without doubt the sole powerhouses of their individual markets holding a big market share for themselves. But, despite the fact that they have that common factor, another thing that they have in common is that these 10 companies are the top ten companies with the highest CSR reputation in the world (SOURCE). CSR the acronym for Corporate Social Responsibility is currently a new business model that many businesses are starting to adapt. Throughout time, things improve and so do peoples expectations; CSR is a new model that incorporates things that people are more concerned with nowadays compared to the past. By requiring companies to spend more of their money on social responsibilities, CSR provides an opportunity for the companies to benefit more than just themselves in many different ways, but the question still lies at the point of to what extent does CSR benefits the companies themselves (SOURCE). There have been a lacking measurement in the actual benefits of CSR and companies are doubting whether or not CSR actually benefits company performance. Despite that though, there must be a reason as to why these powerhouses are incorporating CSR as their main business model and that reason would most definitely be that CSR benefits company performance in so many ways, both externally and internally, that no other business model

CSR is a significant strategy adopted by businesses today. Hence, this paper begins by defining it and then dwells on why organisations depend on it. This paper also will present a summary of the activities of CSR followed at ‘Thistle, Heathrow, London’ which will also include the personal views of the writer on this topic.

CSR is generally a voluntary effort made by companies to please their stakeholders by addressing socio-economic and environmental issues in the community.  This phenomena has been on the rise lately with increasing efforts from managers, owners, investors and even governments to a certain extent (Okpara, J., & Idowu, S.,  2003). This effort, also known as ‘corporate citizenship’ can also be seen as an opportunity to maximize an organization’s accountability and transparency while giving them an opportunity to improve their perception in the eyes of the consumer. This perspective of CSR is meant to be viewed as an effort to drive the private sector to take part in community related developmental

It evaluates value creation in terms of environmental, social and economic performance. Hence, businesses have to succeed economically, as well as stressing concern for social justice and environmental quality. However, an issue with defining CSR is not only concerned with its miscellaneous attributes but also its heterogeneous body of research. Most research conducted is concerned with CSR from a perspective of theoretical articles and quantitative research. Defining CSR and quantifying its value through the use of statistics can be an ambiguous task, which thus; presents the opportunity to greater understand CSR through a qualitative approach.