When Good Corporate Social Responsibility Is Good Business

The scale and nature of the benefits of CSR for an organization can vary depending on the nature of the enterprise, and are difficult to quantify, though there is a large body of literature exhorting business to

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.

In this article, “The Truth About CSR,” authors Rangan, Chase and Karim stress the importance in aligning a company’s social and environmental activities with its business purpose and values (Rangan, Chase, & Karim, 2015, 41). Outcomes of CSR programs should be a “spillover” and not a primary focus of a business, expressing concern towards social responsibility and corporations failing to contribute to society accordingly (Rangan, Chase, Karim, 2015, 42). There is a great deal of importance in companies refocusing their CSR activities on a primary goal and in providing an organized process for bringing consistency and discipline to CSR strategies (42). Rangan, Chase and Karim want corporations to understand why it is important for them to evaluate their CSR activities and refocus them towards the goal of reinforcing the firm’s societal and environmental actions, while also ensuring their actions add to the overall purpose and values of the corporation. According to the authors, even though

Forbes Magazine Entrepreneurs segment published an article “Why CSR? The Benefits Of Corporate Social Responsibility Will Move You To Act”. The author of the article Devin Thorpe, connected with several corporate executives representing small and large organizations from an array of different industries in efforts to establish if CSR does in fact benefit a corporation. Based off his discussions with these business professionals and experts, Devin concluded the following:

Organizations that have a culture of corporate social responsibility have a unique competitive advantage with consumers and stakeholders. While there is an incentive for businesses to be socially responsible, most are unlikely to contribute to social issues that are controversial. In its onset, corporate social responsibility primarily was displayed in the form of donations to various issues. Businesses would tend to take on issues where they could provide an immediate short term impact. Lately, some businesses have implemented more complex models of CSR that aim to provide sustainable assistance to the needs that are most relevant to the community they serve. This change has many benefits for both the organization and the community. The organization benefits from investing in education, as an example because it potentially impacts

Moreover, David Henderson’s book “Misguided Virtue” (2001) pointed out that companies have to adjust their accounting and management approach to adopt CSR raising costs and reducing revenues. In spite of that, the benefits will be able to outweigh the short-term costs in the long run (Millon, 2011).

This paper examines the similarities and findings of three academic papers related to Corporate Social Responsibility (CSR) in accounting. Assumptions are made regarding the importance of CSR to the success of businesses. By looking at three different pieces of literature from the accounting field, there is strong evidence that suggests CSR can be considered an important business function that contributes to profitability. Furthermore, branches of CSR such as Social and Environmental Accounting (SEA) and Greenhouse Gas (GHG) emissions disclosure play important roles in

On the other hand, CSR is positively related to firm’s market worth as earlier research has found it, but effort have been place mostly on looking the relationship between financial performance

The term corporate social performance was first coined by Sethi (1975) and his three level model of CSR are 'social obligation (a response to legal and market constraints); social responsibility(Congruent with societal norms); and social responsiveness (adaptive, anticipatory and preventive) (Cochran, 2007).The conceptual theoretical framework of CSR was developed by (Archie B Carroll 1991), and the four dimensions of CSR pyramid are economic, legal, ethical, and philanthropy .In a pyramid a corporation has four types of responsibilities, where the foundation is the economic responsibility to be profitable. The second is the legal responsibility to obey the law set forth by society. The third ethical responsibility is closely linked to the second. The fourth is philanthropic responsibility are the resources contributed by corporations’’. The implementation tool of CSR are the “activities undertaken by a corporation to support

Competition is becoming more and more fierce while the market is becoming globalization. With higher consumer sovereignty, customers are no longer satisfied with qualify products and good services. The society concerned more about the business ethic and environmental issues. Companies are expected to act virtuously nowadays. The ideas of Corporate Social Responsibility and Corporate Citizenship are spreading faster than ever before and become one of the hottest business models in the recent decades.

Increasing environmental performance through CSR affects companies’ bottom-line measures by strengthening and improving environmental practices. For example, waste management and reducing pollution. A company can better financial performance through increased revenues and lower costs. Ever since the beginning of industry, companies for the most part have involved themselves in corporate social responsibility. Lately the practice of CSR has grown quite a bit, although there are still concerns about corporations’ roles in social responsibilities.

Recently, the expectations of society for companies have increased more than before (Craig, Bhattacharya, Vogel and Levine, 2010), so one significant issue that most firms have been actively involved in is Corporate Social Responsibility (CSR). Some may debate that it decreases company’s profits by spending much money on CSR. However, according to Needle (2004), ‘good’ CSR is also good for business, a firm could benefit from doing CSR. Thus, this paper aims to explain its importance. It begins with the definition of CSR and its four responsibilities, then presents how it influences a business and benefits it can bring. Finally, I am going to describe strategic CSR and discuss why firms have social responsibility.

The aim of this paper is to highlight the impact that Corporate Social Responsibility (CSR) has on company performance and profitability. It will also assess the role of CSR in business activities and in general the theoretical foundations as well as Corporate Citizenship. Furthermore this paper will assess the notion that implementing CSR activities positively affects the image of the organization and can thus boost consumers’ attention and commitment to the organization, which leads to better financial performance for the firm.

“ What are the main characteristics of CSR strategies and what influence do they have on financial performance?”

Business and society are interdependent. The wellbeing of one depends on the wellbeing on the other. Companies engaged in CSR are reporting benefits to their reputation and their bottom line.