Corporate Social Responsibility and Organizational Performance: A Case Study of Shell, UK

Topic: Corporate Social Responsibility and Organizational performance of Shell, UK
Chapter 1: Introduction
1.0 Introduction
Corporate social responsibility is a widely researched topic in terms of the impact of business
on the environment and the society. The idea of CSR sheds light on the business approach used
by business organizations for benefitting the environment they are operating in and giving back
to the society rightfully. As mentioned by Cheng, Ioannou and Serafeim (2014), it is the
responsibility of the business organizations to deliver social, economic and environmental
benefits to the society and all the associated stakeholders. CSR is a concept with different
definitions and practices but the core idea highlights the business model followed by the business
organizations for benefitting the society. The benefits of CSR range from retaining clients to
enhanced sales and financial success (Tai and Chuang 2014).
The last few years have encountered the significance of CSR for the business organizations.
As corporate social responsibility, business organizations have engaged them in several business
initiatives such as women empowerment, saving the environment and funding education
(Flammer 2015). Additionally, business organizations are taking interest in social issues at a
local, national and international level. Active participation for the welfare of the society and the
surrounding environment provides an opportunity for the business organizations to improve the
brand name of the company. According to Tai and Chuang (2014), being a socially responsible
company boosts the image of the company and builds the brand successfully. As a result, the
business organizations are able to portray a positive image about them thereby, engaging the
attention of investors and customers that help in business growth and expansion.

In spite of being a highly researched topic, corporate social responsibility and organizational
performance in terms of their financial aspect is hardly studied previously. As opined by Saeidi
et al. (2015), one of the core social responsibilities of the business organizations is to use their
available resources and engage themselves in activities for increasing profits. Balancing profits
and social responsibility is often challenging for the business organizations because considering
the societal changes and including them within their business model or approach is highly
questioned.
In order to study corporate social responsibility and organizational performance, the case of
Shell Plc is taken into consideration. Shell was established in 1907 with the collaboration of the
Royal Dutch Petroleum Company of Netherlands and Shell transport trading company in the UK.
Shell Plc is one of well-known and well-established companies in the oil and gas sector and
headquartered in Netherlands. Shell is said to be one of the big six oil and gas companies and the
fifth largest company globally. The market capitalization of Shell is £185 billion and is listed as
the largest company listed in the London Stock Exchange and is the highest of any company in
the world. The current workforce of Shell Plc mounts up to 97,000 that are considered for
studying in this research (Shell.in, 2019).
Corporate social responsibility is applicable for almost all business organizations and Shell in
the oil and gas sector is no different. The oil and gas sector in the UK is highly competitive and
indulging and performing social responsibilities appropriately is necessary because this helps in
maximizing profit to shareholders. CSR is used by the business organizations as an effective
business approach and model for establishing a good rapport with the public and the society.
Corporate social responsibility is used as pre-emption strategy for the business organizations for
preventing them from unforeseen risks and corporate scandals, potential environmental accidents

and abiding by the social rules and regulations set by the government (Kim, Li and Li 2014).
Therefore, it can be said that abiding by the corporate social responsibility helps in improving the
financial status because the business organizations are able to attract investors, improve their
brand image and establish a good rapport with the customers and gaining competitive advantage.
1.1 Problem statement
Lack of evidence has been noticed about the relationship between corporate social
responsibility and organizational performance that highlights the financial performance of the
business organizations that highlights a significant gap in the existing literatures. Inadequate
evidence and documents about the impact of corporate social responsibility on organizational
performance is evident because in the past researches have been conducted on the role of
corporate social responsibility on environment and society (Tai and Chuang 2014). Hence, this
research is undertaken by emphasizing on the corporate social responsibility and organizational
performance by studying the financial performance of Shell in the UK (Di Guili and Kostovetsky
2014).
1.2 Research aim
The aim of the research is to investigate the relationship between corporate social
responsibility and organizational performance of Shell in UK that is one of the well-known and
established companies in the oil and gas sector.
1.3 Research objectives
The objectives of the research are:
 To evaluate the CSR initiatives undertaken by Shell Plc
 To review the financial performance of Shell for the past five years