Corporate Social Responsibility in Modern Business Organisations

This essay explores the meaning and role of Corporate Social Responsibility (CSR) in modern business organizations. It focuses on the case study of H&M, a Swedish multinational organization in the retail-clothing sector. The essay discusses the relationship between CSR policies and the business organization, as well as the impact of CSR on corporation tax and investment decisions. It highlights the importance of CSR in enhancing brand image and attracting customers. The essay also addresses the challenges and benefits of implementing CSR activities.

Corporate Social
Responsibility

Table of Contents
INTRODUCTION...........................................................................................................................3
Explain the meaning and evaluate the role of CSR in modern business organisations..............3
Evaluate an organisation’s corporation tax and investment decisions in the context of its CSR
governance and reporting policies..............................................................................................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................7
Books and Journals ....................................................................................................................7

INTRODUCTION
Corporate Social Responsibility also known as CSR is a self-regulating model which
assist an organisation in order to become socially accountable towards their stakeholder, public
and for itself. CSR is considered as one of the most effective business practice which is
incorporated within the organisation in order to maintain sustainable development at the
competitive marketplace. In the present report, H&M is chosen as the base company which
comes under retail-clothing sector (Flammer, 2015). It is a Swedish Multinational organisation
which provide Fast-Fashion clothing for women, men, children and teenagers. H&M was
founded in the year 1947 which was incorporated by Erling Persson, headquarter was located in
Stockholm, Sweden. The present essay will be focusing on the understanding on the topic of
CSR with an examination of relationship between CSR policies and the business organisation. In
addition to this, it will also includes furthermore discussion on the analysis of corporation
taxations as well as investment decisions in reference to the CSR policy.
Explain the meaning and evaluate the role of CSR in modern business organisations
CSR or Corporate Social responsibilities considered as a self-regulating organisational
model which might help in creating business entity accountable towards their customers and
stakeholder, which leads towards the growth and smooth running of the business functioning.
The main aim of implementing CSR activities and practices is to gain various positive results at
the competitive marketplace which are positive in nature rather than negative. It has been
analysed that the CSR activities not only focuses on environmental, social and economic
elements but also examine the expectations and needs of their potential stakeholder which are
associated with the organisation. In addition to this, it is said that this is a concept which needs to
be taken into consideration by the managers of the company as it highly affects the overall
business functionality in a positive manner (Grayson and Hodges, 2017). With the help of being
socially active, different business organisations can easily enhance their reputation at the
competitive marketplace. Therefore, it is very essential for the business organisation to adopt
CSR business model which help in fulfilling social purpose of the entity. In the present context
of H&M, it has been said that this is a business organisation which is social responsible from last
few years which help in enhancing the quality of life as well as living standard of the
communities.

It is very important for a business organisation to have some social purpose with the help
of which they can enhance their brand image and goodwill at the competitive marketplace. It has
been said that it is very essential for every business organisation to give some percentage of
amount from their overall profitability for the welfare and development of the society so that it
will enhance the living standard of individuals. In addition to this, it is also examined that every
single consumer purchase products from only those companies who are involved in any kind of
CSR activity (Hopkins, 2016). Therefore, it become very important for the business organisation
that they must adopt such activities so that there brand image will be enhanced along with
attracting large number of customers towards their business entity. It has been identified that the
role of CSR practices within the modern business entity is quite evident as each and every
organisation is required to alter their working procedure according to the requirement so that
positive results will be produced. These are the ethical practices with the help of which business
organisations leads towards the success of H&M at the competitive marketplace. Apart from this,
one of the major role of adopting CSR activity is to enhance the brand name along with
reputation of the company at highly competitive marketplace. It has been analysed that this
create positive image of the company as if any business organisation involved in CSR activity it
will spread at the market area which affects the overall profitability of the company. For
example, H&M is a business entity which use different techniques and tools so that waste cloths
will be reuse, use all the resources effectively and responsibly so that it will create positive
image of the company at the competitive marketplace. This help the management team of H&M
in order to attain their pre define goals and objectives in an ethical as well as social manner
(Jamali and Karam, 2018).
In addition to this, it has also been identified that there are various challenges which
might affect the business organisation in order to implement CSR activities within the
workplace. Some of these reasons highly affect the business managers in fulfilling their social
responsibilities. One of the biggest challenge is inadequate resources and funds which might
hinder the business managers in order to implement CSR activity within the workplace. This
affects the overall business functionality in a negative manner and also influences the goodwill at
the competitive marketplace. Furthermore, it has also been said that customers highly pressurise
their business organisation that they must perform their functions in an ethical manner (Liang
and Renneboog, 2017). In addition to this, staff members are the one who get benefits with the

help of implementing CSR activity as the working atmosphere are positive in nature. Along with
this, due to positive surroundings and contribution for the development of society, it has been
analysed by the management team of H&M that large number of customers will be attracted
towards the business organisation.
Furthermore, due to various issues and challenges, managers of H&M could not be able
to fulfil their roles and responsibilities as management team face ample number of issues. It has
been said that all the governing bodies highly focuses on these policies & regulations (Lins,
Servaes and Tamayo, 2017). It is also very essential for the Government that they must develop
such strategies so that business organisation can be aware about the benefits of CSR activities in
the business functions. In reference to H&M, it has been said that managers are required to adopt
such technologies and tools which help in reducing wastage, remove harmful chemicals and
enhance the quality of products and services. In addition to this, it is said that with the help of
effective implementation of CSR activities managers of the company will be able to enhance
their goodwill, brand image as well as market share at the competitive marketplace. In addition
to this, it has also been analysed that there are various issues and challenges which might affect
the implementation of CSR activity within the workplace. Therefore, it becomes essential for the
management team of the company to consider all these elements while doing their business
functions with the help of effective CSR activities.
Evaluate an organisation’s corporation tax and investment decisions in the context of its CSR
governance and reporting policies
It has been said that Tax is considered as an essential as well as crucial revenue source
for the government and legal authority of a country. Every individual along with business
organisations such as H&M all are required to pay taxes so that they can maintain their
sustainability at the competitive marketplace (McWilliams, 2015). It has also been said that
taxation is a policy which is compulsory for every individual to pay so that government can
generate more revenue with the help of which infrastructure will be developed, employment
opportunities will be developed which leads towards the enhancement of the living standard of
individuals. It has been said that main aim of taxation policy is to generate revenue so that all the
requirements of the country will be fulfilled in an effective manner. It is said that the main
principle of taxation policy is its economic effect, which includes that the structure of tax might
be formulated in an effective manner so that all the hurdles will be resolved. Another major

principle is equality as every individual person requires to pay tax on the basis of their pay scale.
It is said that it is the right of every individual to pay their share of contribution in the overall
development of the society and communities. Along with this, least developing and developing
organisations major target is tax evasions, which as a result act as one of the prime barrier in
their overall performance (Saeidi and et.al., 2015).
In addition to this, it is said that Tax evasion is a sort of illegal act mainly used in
reducing tax liability with the help of some policies such as inflating expenses as well as under
value of taxation. It has also been analysed that illegal practice used in different procedures
might includes hiding valid data, false statements, overstatements of credit, misleading records
and many more which sometimes used as personal rather than business requirements. If any
organisation avoid such roles and responsibilities then it is considered as an act of crime. Such
people need to be punished by the government of that country. Furthermore, it has also been said
that tax planning is considered as one of the most effective process as it help in taking decisions
related to investment. Planning can be related to the investment in mutual funds, provident funds,
fixed deposits for saving money for any kind of future uncertainties. It is said that tax avoidance
is an other factor which might be used by the people which is considered as an illegal act (Slack,
Corlett and Morris, 2015).
Furthermore, it has been said that there are different types of tax payers who mainly pay
their taxes according to their suitability. In the present context of H&M, it has been said that
managers of the company embracing CSR practices, with the help of which they can perform
their business functionality in an effective and appropriate manner. It has been said that the top
management team of H&M conduct meetings on a regular basis so that they can collaboratively
made a discussion about different CSR policies and strategies. In addition to this, it has also been
said that some of the policies which might be harmful for the business environment needs to be
change so that brand image of the company will be enhanced at the competitive marketplace.
With the help of implementing CSR activities it has been said that some of the government pay
some relaxation to the organisation in their overall tax amount (Watson, 2015). This will
encourage business organisation in order to implement effective CSR activities as well as pay
their taxation on a regular basis. This as a result improves the brand image of the company at the
competitive marketplace along with attracting large number of customers towards their business
functionality. Along with this, company who mainly adopt CSR activities attract large number of

stakeholders towards their business organisation which might influences their overall investment
in a positive manner.
CONCLUSION
With the help of above mentioned essay, it has been concluded that CSR plays very
essential role in order to maintain long term sustainability as well as goodwill at the marketplace.
It is a policy with the help of which various activities related with the expected surrounding as
well as social concerns in order to run the business functions in a smooth manner and maintain
reputation at the market area. Role of a CSR is to enhance the good will, rise in market share,
gaining competitive advantages and many more. Apart from this, it has also been identified that
CSR affects the corporate taxation policies as well as investment related decisions. In addition to
this, it has also been said that taxation is another essential element which help business
organisation in order to grab different opportunities at the marketplace.

REFERENCES
Books and Journals
Flammer, C., 2015. Does corporate social responsibility lead to superior financial performance?
A regression discontinuity approach. Management Science. 61(11). pp.2549-2568.
Grayson, D. and Hodges, A., 2017. Corporate social opportunity!: Seven steps to make
corporate social responsibility work for your business. Routledge.
Hopkins, M., 2016. The planetary bargain: corporate social responsibility comes of age.
Springer.
Jamali, D. and Karam, C., 2018. Corporate social responsibility in developing countries as an
emerging field of study. International Journal of Management Reviews. 20(1). pp.32-
61.
Liang, H. and Renneboog, L., 2017. On the foundations of corporate social responsibility. The
Journal of Finance. 72(2). pp.853-910.
Lins, K.V., Servaes, H. and Tamayo, A., 2017. Social capital, trust, and firm performance: The
value of corporate social responsibility during the financial crisis. The Journal of
Finance, 72(4). pp.1785-1824.
McWilliams, A., 2015. Corporate social responsibility. Wiley encyclopedia of management,
pp.1-4.
Saeidi, S.P and et.al., 2015. How does corporate social responsibility contribute to firm financial
performance? The mediating role of competitive advantage, reputation, and customer
satisfaction. Journal of business research. 68(2). pp.341-350.
Slack, R.E., Corlett, S. and Morris, R., 2015. Exploring employee engagement with (corporate)
social responsibility: A social exchange perspective on organisational
participation. Journal of Business Ethics. 127(3). pp.537-548.
Watson, L., 2015. Corporate social responsibility research in accounting. Journal of Accounting
Literature. 34. pp.1-16.