Corporate Social Responsibility and BHP Billiton

This report discusses the different approaches of the corporate social responsibility, and for this purpose CSR is considered as the voluntary commitment of the business organizations to involve economic, social, and environmental criteria and actions in their business practices. The preferred case study is the BHP Billiton.

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Corporate social responsibility

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Executive Summary:
This report discuss the different approaches of the corporate social responsibility, and for this
purpose CSR is considered as the voluntary commitment of the business organizations to involve
economic, social, and environmental criteria and actions in their business practices. for the
purpose of this report, the preferred case study is the BHP Billiton.

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Contents
Executive Summary:....................................................................................................................................2
Introduction:...............................................................................................................................................3
Objectives:...................................................................................................................................................3
Methodologies:...........................................................................................................................................3
Carroll’s Pyramid:....................................................................................................................................4
Wartick and Cochran’s:............................................................................................................................5
Key stakeholders:....................................................................................................................................5
Information Analysis:...................................................................................................................................6
Environment:...........................................................................................................................................6
Human Rights:.........................................................................................................................................6
Governance:............................................................................................................................................7
Findings:......................................................................................................................................................7
Recommendations:.....................................................................................................................................8
References:..................................................................................................................................................9

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Introduction:
Corporate Social responsibility (CSR) is considered as the most significant phenomenon not only
in Australia but in each and every part of the world. CSR is considered as the business method
that mainly contributes towards the maintainable growth by providing economic, social and
environmental advantages to all the stakeholders (McWilliams & Siegel, 2001). CSR is the
approach which is defined in different ways by the different experts. CSR is the wide concept
which addresses different topics such as human rights, corporate governance, health and safety,
environment, working conditions and contribution to the economic development ( Lexicon, n.d.).
This report defines the CSR approach and its features in context of the BHP Billiton, and it also
define the approach and policies developed by BHP Billion in the context of the CSR activities
such as human rights, environment, etc. Structure of this report includes the objectives,
methodologies, information analysis, findings, and recommendations. At the end, brief
conclusion is stated to end this paper.
Objectives:
This paper mainly conducts the research on Corporate Social Responsibility and its aspects in
lieu of the BHP Billiton, and address number of topics such as Carroll’s model in context of
company, key stakeholders, environment, human rights, governance, and philanthropy approach
of the company.
Methodologies:
The approach of CSR is considered as the one of the important ethical issues which is
surrounded to the corporate decision-making and behavior (Branco and Rodrigues, 2006). In lieu
of the business concept, concept of CSR is introduced in the end period of the 20th Century, when
big number of organizations reflects the impacts of the corporate decisions on society and the
environment. Generally, CSR is defined as the duties imposed on the organizations towards the
society, and especially duties towards the stakeholders of the organization and also towards those
who encourage the policies and practices of the corporates (Windsor, 2001).
Carroll’s Pyramid:
As stated by the Carroll (1991), there are four stages in which activities of the CSR are divided
and these stages are stated in the form of pyramid. This pyramid defines four stages of the CSR
and all these stages are stated below:

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Economic Responsibility: this responsibility is considered as the company’s basic responsibility
in context of the profit of the company which is occurred by satisfying the needs and
expectations of the consumers. On part of the BHP Billiton, total economic contribution of the
company to its stakeholders in 2017 is the US$ 26.1 billion and company make payment of US$
4.7 billion at global level to the government in the form of taxes, royalties, and other payments
(BHP, 2017).
Legal responsibility: this responsibility reflects the fact that organization also bear the obligation
to comply with all the laws. BHP Billiton mainly focuses on their strategies and policies and
frames such strategies and policies which ensure that company complied with all the legal
requirements.
Ethical responsibility: in this company ensures that their actions are conduct in such manner as it
complied with the social responsibility and ethical standards. BHP develops code of business
conduct for the purpose of ensuring that their actions meet with the ethical standards and fulfill
their social responsibility (Matten & Moon, 2004).
Philanthropic responsibility: this theory assumes that organization is the good citizen and
contributes towards the resources of the community. In context of BHP, strong and dignified
involvement with the host communities is important to their business, and the minimum
requirement guide of the organization define the approach of the organization towards the
communities and how organization can interact with the communities openly for the purpose of
responding and understanding their issues. BHP play most vital role in the financial development
of the Country and this contribution results in the improvement of standard of living.
Contribution of the BHP includes large number of employment chances, acquisition of the local
goods and services, infrastructure development and also provides the support to the local and
national economies over the payments of taxes and royalties. With the help of these actions, BHP
also facilitates these achievements of the United Nations’ (UN) Sustainable Development Goals.
Some other programs are also there through which BHP involvement can be considered such as:
 Social investment made by company on the voluntary basis.
 Engagement of the company with the host communities.
 Provide support to the local economic growth.
 Company builds the partnerships with the indigenous people (BHP, 2017).
Wartick and Cochran’s:
As stated by the Wartick and Cochran’s, responsibility of the organization under CSR are
adjusted in three areas that are principles, process, and policies. All these segments of this model
are defined in detail below:

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Principles is the stage in which CSR activities of the organization are separated into four parts
that are economic, legal, ethical, and philanthropy. All these parts of the principles are
introduced by Carroll’s in their model and BHP Billiton fulfills their responsibilities in all the
areas (Wartick & Cochran, 1985).
Process is the stage which states the corporate social responsiveness and this separated in four
areas such as reactive, defensive, accommodative, and proactive. This segment mainly defines
the company’s ability to react on the changes occurred in the environment and society, and this
stage of the model consider the manager’s ability to develop the responses for that change. BHP
Billiton adopts the proactive approach as this company prepares itself in advance for responding
to the changes and makes their strategies flexible so that relevant changes can made accordingly.
Policies are the third and last stage of this model and this stage identified three areas that are
issues identification, issues analysis, and response development. This stage restrict the shocks in
the form of changes that may be face by the organization while conducting their business and
this stage also consider the policies in context of the CSR activities. BHP mainly consider the
issues identification and in this context BHP determine the strategy formulation and once issues
identified, BHP frames strategy to resolve these issues (BBHP, 2016).
Key stakeholders:
Following is the range of stakeholders of the BHP Billiton Limited:
Stakeholders Group
Government Representatives of Australian government
Representatives of local government
Non-government organizations and service
providers
Community and environment groups, and
private service providers
Industry Local and regional industries
Aboriginal groups Native title claimants
Landholders Pastoral leaseholders and freehold landowners
General public Local, regional, state, territory, and national.
Relevant communities Eyre peninsula, etc.
Employees Staff of BHP Billiton (BHP, 2009)

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Information Analysis:
Environment:
The success of the strategy of the BHP is related to its economic growth in context of developing
and advanced economies. It must be noted that, it is not possible for the BHP Billiton to ensure
sustained growth without developing effective reply in context of the climate change. It is
necessary for the organization to recognize that they are obligated to decrease the greenhouse gas
(GHG) emissions, and improve their capability to answer the physical and non-physical
influences of weather change and work with others for the purpose of enhancing the global
response. Climate change is the most important issue which must be considered by the board of
BHP on priority basis, and management of the company owns prime responsibility for designing
and implementing their answer to climate change. Their related response in this context focuses
on the mitigation, adaptation, etc. Climate strategy of the company is knowledgeable and
maintained by the active engagement with the crucial stakeholders of the company (BHP, 2017).
Human Rights:
Human rights performance of the BHP is considered as the accountability of the Board’s
Sustainability Committee, and this committee is under obligation to monitor health, safety,
environment and community performance. Each and every action of the BHP imposes
answerability on the committee to ensure that actions complied with the requirements related to
the mandatory human rights performance on part of the senior managers and leaders. Human
rights are also included in the risk management system of the organization by the way of
requirements of the organization’s risk management standard for the purpose of identifying and
manage the risk related to the business activities, functions, and processes of the company. The
BHP committee of CSR also gives their expert advice to the senior management of the company
in terms of human rights policies, practices and performance (BHP, 2018)
Company play important role in the defense of the human rights and conduct number of practices
in context of poverty, corruption, and alienation. In terms of poverty, BHP ensures that wages
and advantages for the employees must be paid in lieu of standard working week, and these
payments must satisfy the least national legal standards or local industry benchmarks, whichever
is high. In nations states, in which no minimum wage legislation is established, supplier wants to
establish a wage framework which ensures a passable standard of living for all its employees
(BHP, 2018).
In terms of corruption, BHP’s code of business conduct and anti-corruption standard clearly
restrict the bribery and corruption in all the business operations of the company. BHP prohibits
the corruption by restricting the payments to the government officials for conducting those
operations for which company is legally entitled (BBHP, n.d.). Anti-corruption obligations of the
employees and contractors are also clear, and the organization ensures the preparation to make
sure what do they understood. In similar manner, senior management needed to incorporate anti-
corruption compliance in the business performance indicators because these indicators ultimately

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determine the remuneration of employees. Following are the standards in context of anti-
corruption approach of BHP:
 Any gifts travel, and hospitality provided to any person including government officials
above stated thresholds.
 Provide any kind of commercial sponsorships.
 Offer any community donations and projects.
 Acquisitions and disinvestments (BHP, 2018).
Governance:
Corporate governance is the broader approach and system of the rules, practices, and processes
through which firm is focused and measured. Corporate governance mainly includes the balance
of interest of different stakeholders of the company such as many stakeholders, management, etc.
(Davis, 2005).
BHP compliance with the corporate governance standards in their home countries that are UK
and Australia, and also comply with the governance requirements which are applied on the
company because of the listing status of the company under New York Stock Exchange (NYSE)
and also because of their registration with the SEC in the United States (BHP, 2017)
Findings:
After analyzing the facts of the BHP and CSR approaches, it is clear that CSR plays most
important role in ensuring the sustainability growth and profitability of the business. CSR is
considered as the business approach that mainly contributes towards the sustainable development
by providing economic, social and environmental advantages to all the stakeholders. BHP’s,
strong and dignified involvement with the host communities is important to their business, and
the minimum requirement guide of the organization define the approach of the organization
towards the communities and how organization can interact with the communities openly for the
purpose of responding and understanding their issues. It is not possible for the BHP Billiton to
ensure sustained growth without developing effective reply in context of the climate change.
Recommendations:
It is necessary for the BHP Billiton to focus on their actions which cause damage to the
environment and contributes more to the society by reducing the carbon emission which extends
because of their actions in the society. For this purpose company can use such technology and
equipment’s which reduce the pollution and save the plant from more damage.
References:
BHP, (2009). Stakeholder Consultation and Engagement. Available at:
https://www.bhp.com/-/media/bhp/regulatory-information-media/copper/olympic-dam/0000/

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draft-eis-main-report/odxeischapter7stakeholderconsultationandengagement.pdf. Accessed on
12th June 2018.
BHP, (2016). Annual report 2016. Available at:
https://www.bhp.com/-/media/bhp/documents/investors/annual-reports/2016/
bhpbillitonannualreport2016.pdf?la=en. Accessed on 12th June 2018.
BHP, (2017). Annual Report 2017. Available at:
https://www.bhp.com/-/media/documents/investors/annual-reports/2017/
bhpannualreport2017.pdf. Accessed on 12th June 2018.
BHP, (2017). Economic Contribution Report 2017. Available at:
https://www.bhp.com/-/media/documents/investors/annual-reports/2017/
bhpeconomiccontributionreport2017.pdf. Accessed on 12th June 2018.
BHP, (2017). Sustainability report 2017. Available at:
https://www.bhp.com/-/media/documents/investors/annual-reports/2017/
bhpsustainabilityreport2017.pdf. Accessed on 12th June 2018.
BHP, (2018). Anti-corruption compliance. Available at:
https://www.bhp.com/our-approach/operating-with-integrity/anti-corruption-compliance.
Accessed on 12th June 2018.
BHP, (2018). Our approach. Available at: https://www.bhp.com/our-approach/operating-with-
integrity/respecting-human-rights/our-approach. Accessed on 12th June 2018.
BHP, (2018). Respecting human rights and UK Modern Slavery Act Statement. Available at:
https://www.bhp.com/our-approach/operating-with-integrity/respecting-human-rights. Accessed
on 12th June 2018.
BHP. Working with integrity: Code of Business Conduct. Available at:
https://www.bhp.com/-/media/bhp/documents/aboutus/ourcompany/code-of-business-conduct/
160310_codeofbusinessconduct_english.pdf?la=en. Accessed on 12th June 2018.
Branco, M. C., & Rodrigues, L. L. (2006). Corporate social responsibility and resource-based
perspectives. Journal of Business Ethics, 69(2), 111-132.
Carroll, A. B. (1991). The pyramid of corporate social responsibility: toward the moral
management of organizational stakeholders. Business horizons, 34(4), 39-48.
Davis, G. (2005) New Directions in Corporate Governance, Annual Review of Sociology, Vol.
31, pp. 143-162.
Lexicon. Definition of corporate social responsibility (CSR). Available at:
http://lexicon.ft.com/Term?term=corporate-social-responsibility--(CSR). Accessed on 12th June
2018.
Matten, D., & Moon, J. (2004). Corporate social responsibility education in Europe. Journal of
business Ethics, 54(4), 323-337.

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McWilliams, A., & Siegel, D. (2001). Corporate social responsibility: A theory of the firm
perspective. Academy of management review, 26(1), 117-127.
Wartick, S. & Cochran, P. (1985). The Evolution of the Corporate Social Performance Model,
Academy of Management Review, Volume 10(4), 758-769.
Windsor, D. (2001). The future of corporate social responsibility. International Journal of
Organizational Analysis, 9(3), 225-256.