WHAT IS CORPORATE SOCIAL RESPONSIBILITY?

Figure 1: Corporate Social Responsibility (Yasin, 2019)

Corporate social responsibility is a management concept whereby companies integrate social and environmental concerns in their business operations and interactions with their stakeholders.

The following definitions of CSR have been proposed by different authors:

• “How companies manage the business processes to produce an overall positive impact on society” (Baker, 2004)
• “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” (World Business Council for Sustainable Development in Hopkins, 2007)
• Additional responsibilities of businesses to local and wider communities apart from its core responsibility of profit maximization (Simpson and Taylor, 2013)

Let’s take a look at the key elements of effective CSR programs:

1. Environmental concerns

A majority of companies have large carbon footprints, so any effort to reduce them is good for the environment. These efforts include minimizing packaging to reduce waste, prioritizing recycling or using products of local origin. These practices not only save money, but they also save the planet.

2. Philanthropy

CSR and corporate philanthropy are often confused, but there is an important distinction between the two. Corporate philanthropy refers to the general practice of a business that gives back to others, usually through charitable donations. CSR is a broader strategy in which philanthropic efforts align and are integrated into the overall mission and business practices of a company.

3. Ethical labour practices

This is quite simple: CSR programs favor fair and ethical treatment of employees. Ethical treatment includes ensuring employee safety, promoting a healthy workplace and other practices that contribute to the well-being of employees.

4. Economic responsibility

Economic responsibility is a term used to describe ethical financial practices in business. Of course, while all companies are legally required to pay taxes in one way or another, companies with an established CSR program pay close attention to how the money they pay in taxes is used for the benefit of their surrounding communities.

It is important to note that all economic responsibility does not occur outside the walls of your company, as you wish. An essential aspect of economic responsibility is to provide employees with fair and competitive wages to ensure their well-being and their ability to support themselves and their families.

Reference

Baker, M. (2004) “Corporate Social Responsibility – What does it mean?” Available at: http://www.mallenbaker.net/csr/definition.php

Corporate Social Responsibility (2013) Investopedia, Available at: http://www.investopedia.com/terms/c/corp-social-responsibility.asp#axzz2A54oj5IY

Simpson, J. & Taylor, J.R. (2013) “Corporate Governance Ethics and CSR” Kogan Page

Yasin, E., 2019. CORPORATE SOCIAL RESPONSIBILITY (CSR)? IS THAT WHAT IT’S CALLED. [Online] Available at: http://ripplezoo.com/2019/09/13/corporate-social-responsibility-csr-is-that-what-its-called/ [Accessed 9 January 2020].