logo

Corporate social responsibility: in a global context

   

Added on  2022-10-19

24 Pages13266 Words44 Views
C h a p t e r 1
Corporate social responsibility:
in a global context
I N T H I S C H A P T E R W E W I L L :
Examine the rise to prominence of corporate social responsibility
Analyze different definitions of corporate social responsibility
Outline six core characteristics of corporate social responsibility
Explore corporate social responsibility in different organizational contexts
Explore corporate social responsibility in different national contexts
Explain the approach to corporate social responsibility adopted in the rest of
the book
Introduction: the recent rise of CSR
The role of corporations in society is clearly high on the agenda. Hardly a day goes
by without media reports on corporate misbehaviour and scandals or, more positively,
on contributions from business to wider society. A quick stroll to the local cinema
and films such as Inside Job, Margin Call, and Wall Street 2, reflect a growing
interest among the public in the impact of corporations on contemporary life.
Corporations are clearly taking up this challenge. This began with ‘the usual
suspects’ such as companies in the oil, chemical, and tobacco industries. As a result
of media pressure, major disasters, and sometimes governmental regulation, these
companies realized that propping up oppressive regimes, being implicated in human
rights violations, polluting the environment, or misinforming and deliberately harming
their customers, just to give a few examples, were practices that had to be recon-
sidered if they wanted to survive and prosper. Today, however, there is virtually no
industry, market, or business type that has not experienced increasing demands to
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
Corporate (2013)-01-c.qxd 6/25/13 1:03 PM Page 3

legitimate its practices to society at large. For instance, banking, retailing, tourism,
food and beverages, entertainment, and healthcare industries — for long considered
to be fairly ‘clean’ and uncontroversial — now all face increasing expectations that
they institute more responsible practices.
In the context of the global economic crisis, which began in 2008 and rever-
berated for a number of years thereafter, questions regarding the responsibilities of
business have moved still further to the fore of the media, political and public interest.
The focus here has been on financial institutions primarily, whose imprudent practices
are largely held to blame for igniting a wave of economic recession. As governments
bailed out failing businesses and popular protests such as ‘Occupy Wall Street’
spread globally, companies in the financial sector faced a new era of scrutiny of their
values, goals, and purpose.
Companies have responded to this agenda by advocating what is now a
common term in business: corporate social responsibility. More often known simply
as CSR, the concept of corporate social responsibility is a management idea that
has risen to unprecedented popularity throughout the global business community
during the last decades. Most large companies, and even some smaller ones, now
feature CSR reports, managers, departments, or at least CSR projects, and the
subject is increasingly promoted as a core area of management, next to marketing,
accounting, or finance.
If we take a closer look at the recent rise of CSR, some might well argue that
this ‘new’ management idea is little more than a recycled fashion, or as the old saying
goes, ‘old wine in new bottles’. And, in fact, one could certainly suggest that some
of the practices that fall under the label of CSR have indeed been relevant business
issues at least since the Industrial Revolution. Ensuring humane working conditions,
providing decent housing or healthcare, and donating to charity are activities that
many of the early industrialists in Europe and the US were involved in — without
necessarily shouting out about them in annual reports, let alone calling them CSR.
The involvement of business in social issues is not the prerogative of the West. In
India, for example, companies such as Tata can pride themselves on more than
100 years of responsible business practices, including far-reaching philanthropic
activities and community involvement (Elankumaran et al, 2005). What we discover
then in the area of CSR is that while many of the individual policies, practices, and
programmes are not new as such, corporations today are addressing their role in
society far more coherently, comprehensively, and professionally — an approach that
is contemporarily summarized by CSR.
As well as the rise to prominence of CSR in particular companies, we have also
witnessed the emergence of something like a CSR ‘movement’. There has been a
mushrooming of dedicated CSR consultancies, all of which see a business oppor-
tunity in the growing popularity of the concept. At the same time, we are witnessing
a burgeoning number of CSR standards, watchdogs, auditors, and certifiers aiming
at institutionalizing and harmonizing CSR practices globally. More and more industry
associations and interest groups have been set up in order to coordinate and create
synergies among individual business approaches to CSR. Meanwhile, a growing
number of dedicated magazines, newsletters, social media and websites not only
4 U N D E R S T A N D I N G C S R
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
Corporate (2013)-01-c.qxd 6/25/13 1:03 PM Page 4

contribute to providing an identity to CSR as a management concept, but also help
to build a worldwide network of CSR practitioners, academics, and activists.
Defining CSR: navigating through the jungle of definitions
In the context of such an inexorable rise to prominence of CSR, the literature on the
subject, both academic and practitioner, is understandably large and expanding.
There are now thousands of articles and reports on CSR from academics,
corporations, consultancies, the media, NGOs, and government departments; there
are innumerable conferences, books, journals, and magazines on the subject; and
last, but not least, there are literally millions of web-based formal and social media
contributions dealing with the topic from every conceivable interest group with a
stake in the debate.
How then to best make sense of this vast literature so as to construct a coherent
account of what CSR actually is? After all, few subjects in management arouse as
much controversy and contestation as CSR. For this reason, definitions of CSR
abound, and there are as many definitions of CSR as there are disagreements over
the appropriate role of the corporation in society. Hence there remains a lack of
consensus on a definition for CSR (Lindgreen & Swaen, 2010). The CSR page on
Wikipedia, the online encyclopaedia, has been in more or less permanent dispute
since 2007 (Ethical Performance, 2007) and continues to be challenged for its
neutrality.
Table 1.1 provides just a few examples of the many different ways that CSR is
described and defined by different organizations across the globe. As this clearly
shows, there are some similarities in the way that different actors understand CSR,
as well as considerable differences. Moreover, although we often look to academic
research to provide clarity among so much ambiguity, this diversity is also reflected
in scholarly definitions of CSR. For example, one early writer on CSR, Keith Davis
described CSR as ‘the firm’s consideration of, and response to, issues beyond
the narrow economic, technical, and legal requirements of the firm’ (Davis, 1973),
while a few years later Archie Carroll (1979) defined it much more broadly to include
exactly those elements that Davis excluded: ‘the social responsibility of business
encompasses the economic, legal, ethical, and discretionary expectations that
society has of organizations at a given point in time.’
This heterogeneity in CSR definitions has continued unabated. While the Carroll
definition given above is arguably the most commonly cited one, it remains contested,
as we will see later in Chapter 3. Therefore, others have taken a different route and
rather than specify particular responsibilities, have offered more general definitions
that seek to include the different opinions on CSR that are evident across the
literature, and across practice. For instance, Brown and Dacin (1997) define CSR
as a company’s ‘status and activities with respect to its perceived societal or, at
least, stakeholder obligations’, while Matten and Moon (2008) suggest that CSR
‘empirically consists of clearly articulated and communicated policies and practices
of corporations that reflect business responsibility for some of the wider societal
C S R I N A G L O B A L C O N T E X T 5
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
Visit the
companion
website for
links to CSR
organizations,
interest groups
and web
forums
CWS 1.1
Corporate (2013)-01-c.qxd 6/25/13 1:03 PM Page 5

6 U N D E R S T A N D I N G C S R
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
Table 1.1: CSR definitions
Name of the Type of Definition Source
organization organization
International Non- CSR as a way in which enterprises www.ilo.org/
Labour governmental give consideration to the impact of wcmsp5/groups/
Organization organization their operations on society and public/---ed_
(international) affirm their principles and values emp/---emp_
both in their own internal methods ent/---multi/
and processes and in their documents/
interaction with other actors. publication/wcms
_116336.pdf
Corporate NGO Corporate Social Responsibility CORE (2011)
Responsibility coalition (CSR) has been promoted by
Coalition (UK) business as a way of realising its
(CORE) ‘social responsibilities’ beyond
making a profit for its shareholders.
In contrast to this view, NGOs and
trade unions tend to dismiss CSR as
a public relations tool at best, and at
worst a means for corporations to
avoid the creation of regulatory and
legal mechanisms as a means of
ensuring that they adhere to
acceptable standards of conduct.
Grameen Social Businesses are identifying themselves Yunus & Weber
Bank enterprise with the movement for Corporate (2009)
(Bangladesh) Social Responsibility (CSR), and
are trying to do good to the people
while conducting their business.
But profit-making still remains
their main goal, by definition.
Though they like to talk about
triple bottom lines of financial,
social, and environmental benefits,
ultimately only one bottom line
calls the shot: financial profit.
General Business GE businesses depend on the www.ge
Electric organization infrastructure, skills and institutions citizenship.com/
(US) of stable, prosperous societies and about-citizenship/
healthy environments. To succeed as
a global business, we need to be a
part of building these societies where
we operate. We do this through the
products and services we create, the
way we work with employees,
customers, suppliers and investors,
the public policies we advocate and
the philanthropic partnerships we
support.
Corporate (2013)-01-c.qxd 6/25/13 1:03 PM Page 6

C S R I N A G L O B A L C O N T E X T 7
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
Table 1.1: Continued
Name of the Type of Definition Source
organization organization
Tata Business Jamsetji Tata and those who followed www.tata.com/
organization in his immediate wake set the CSR pdf/COH_2009/
(India) mandate for Tata companies: to look coh_foreword.pdf
beyond the generation of products
and profits to serving the communities
in which they functioned.
Foreign Governmental Corporate Social Responsibility (CSR) www.
Affairs and organization is defined as the way companies international.gc.
International (Canada) integrate social, environmental, and ca/trade-
Trade economic concerns into their values agreements-
and operations in a transparent and accords-
accountable manner. It is integral to commerciaux/ds/
long-term business growth and csr.aspx?view=d
success, and it also plays an
important role in promoting
Canadian values internationally
and contributing to the sustainable
development of communities
Chinese Governmental A concrete action taken by Chinese www.ethicalcorp.
Ministry of organization companies to implement the political com
Commerce (China) aspiration of the new Communist
Party collective leadership — putting
people first to create a harmonious
society
Department Governmental The voluntary actions that business BERR (2009)
for Business, organization can take, over and above compliance
Innovation (UK) with minimum legal requirements,
and Skills to address both its own competitive
interests and the interests of wider
society.
MVO Nederland NGO The Corporate Social Responsibility www.
(CSR (Netherlands) approach means that the company mvonederland.nl/
Netherlands) takes responsibility for the effects of content/pagina/
the business’ activities on people and wat-mvo
the environment. The company makes
conscious choices in order to find a
balance between People, Planet and
Profit. Businesses can even go a step
further and focus on new market
opportunities, growth and innovation
with a view to profiting people, society
and the environment. Voluntary
commitment to society.
Corporate (2013)-01-c.qxd 6/25/13 1:03 PM Page 7

8 U N D E R S T A N D I N G C S R
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
Table 1.1: Continued
Name of the Type of Definition Source
organization organization
Nike Business It’s not just about getting better at http://nikeinc.
organization what we do — addressing impacts com/pages/
(US) throughout our supply chain — it’s responsibility
about striving for the best, creating
value for the business and innovating
for a better world.
World Business We believe that corporate global www.weforum.
Economic association citizenship is fundamentally in the org/issues/
Forum (International) enlightened self-interest of global corporate-global-
corporations since their growth, citizenship
prosperity and sustainability is
dependent on the state of the global
political, economic, environmental
and social landscape.
European Governmental The responsibility of enterprises for Commission of
Commission organization their impacts on society. the European
(EU) Corporate social responsibility Communities
concerns actions by companies over (2011)
and above their legal obligations
towards society and the environment.
Certain regulatory measures create
an environment more conducive to
enterprises voluntarily meeting their
social responsibilities.
World Bank International Corporate Social Responsibility http://info.world
organization (CSR) is the commitment of bank.org/etools/
(international) business to contribute to sustainable docs/library/
economic development, working with 57434/public
employees, their families, the local policy_
community and society at large to econference.pdf
improve quality of life, in ways that
are both good for business and good
for development
Business for Not-for-profit Business decision making linked to www.forensic
Social business ethical values, compliance with legal solutions.info/
Responsibility association requirements, and respect for people, page20.html
(US) communities, and the environment
around the world.
CSR Asia Social We believe CSR is a company’s www.csr-
enterprise commitment to operating in an asia.com
(Asia) economically, socially and
environmentally sustainable
manner whilst balancing the
interests of diverse stakeholders.
Corporate (2013)-01-c.qxd 6/25/13 1:03 PM Page 8

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
Developing CSR Strategy for SMEs in Thailand
|55
|15057
|182

The Effect of Corporate Social Responsibility Transformation on Companies’ Development in the Construction Industry
|62
|16901
|361

Failure of CSR Approach of Facebook
|17
|4542
|290

Governance and Sustainability- Document
|15
|3509
|41

Importance of Corporate Social Responsibility and Sustainable Reporting: A Case Study of IGO Group
|16
|4189
|184

FPT Corp: A Vietnamese Company with a Social Purpose
|4
|958
|58