Corporate Social Responsibility in Business Law and Ethics

This essay discusses the importance of Corporate Social Responsibility (CSR) in the context of Business Law and Ethics. It covers the extent to which corporations take CSR seriously, the importance of CSR for consumers, employees, and investors, and legal frameworks for CSR in the UK. The essay also provides examples of CSR practices in the UK.

Business Law and
Ethics

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Discuss the extent to which corporations take Corporate Social Responsibility
Seriously......................................................................................................................................1
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Business law is framework of rules, regulations in form of agreements, domestic and
international laws and conventions which govern the commercial matters of the organisation. It
is also known as corporate law, commercial law and mercantile law. It helps the company to
promote social welfare and social justice as it is their social responsibility to hold good position
in the market. The UK business law aims to promote CSR and its legislation is made to serve
the mankind. The social welfare is the responsibility of every citizens and it secure the general
interest of every individual. For proper running of the organisation business law plays an
important role as it govern the business of the organisation (Bouzouitina, et.al 2021). This essay
discussion detail about the corporate social responsibility. It considered as a conceptualization of
the management of companies while amalgamate the conception or arena of environmental and
social issues in corporate operations and the relationship of organisation with their shareholders
and partners. Such responsibility consist of the human rights, economic, philanthropic and
environmental responsibility.
TASK 1
Discuss the extent to which corporations take Corporate Social Responsibility
Seriously
Corporate social responsibility considered as as self regulation of businesses with the
purpose of fulfilling social accountability which helps in developing positive image of the
organisation in the society. With this purpose the concept of corporate social responsibility
introduce by the company. It also practise by considering the environmental friendly, promoting
gender equality, eco-consious, inclusion at workplace, diversity, treating employees with respect,
pay back to the society and last ensuring decision relating to business ethically. Earlier the
practice of corporate social responsibility made by the company on voluntary basis. Later on
with the advancement of technologies, continuous exploitation of natural resources and
neglecting the responsibility towards nature and mankind the practices of CSR become
mandatory for each organisation. Recently there are various international, national and regional
frameworks are laid down in context to corporate social responsibility (Cvenkel, 2018). However
there are several organisation which practice corporate social responsibility beyond the legal
framework by introducing the concept of dealing good in their business model.
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There are various reasons for embrace the practices of corporate social responsibility as it
perceived genuineness. In order to practices CSR the company required to involve it into the
culture of the organisation and the operations of the business. Due to social consciousness
surroundings employees and consumer give preference to those organisation who actively
involved in the practises of CSR. It helps in preventing corporate hypocrisy which are practice
by several organisations. Fro assuring the authenticity of CSR, and organisation considered its
values, mission, major issues and determine which align with the culture and goal of the
organisation. In this context organisation can do it itself or can take the assistance of 3rd party for
an assessment. Now a days certain organisation by considering the 17 goals of sustainable
development of united nation practice the CSR in their organisation as good place to start. These
goals focus on the well-being, good health, gender equality and many more which are practice by
the most of the organisations.
There are various importance of practise of CSR in the organisation such as
improvisation of consumers perception states that the image of socially conscious considered as
important for the organisation. As consumers, employees and stakeholders prioritize to those
companies who practice corporate social responsibility in their organisation (Deb, 2022). It helps
in establishing the accountability in reference to social changes by their practices and belief. It
makes good impression in the mind of consumer that the product and services of organisation are
not only beneficial for mankind but also nature friendly. As the perception of consumer towards
peculiar company plays an important role as it focus on the social causes which considered as
best mode to enhance the brand value of the organisation and helps in sustain in the competition.
In short it helps in attracting new customers which enhance the company values, reputation,
social and environmental activism.
The another importance of CSR is that it helps in retaining and attracting new and
existing employees as consumers are not only considered as single factor which determine the
success of the organisation employees are play crucial part in the progress of the organisation
they are considered as assets of the company. So, the strategy of sustainability plays an important
role while selecting the best human resource of the organisation. In this direction organisation
focus on the concept of triple bottom line which state about people, planet and revenue. These
three bottom line are necessary for efficient functioning of an organisation.
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The other one importance of CSR is to attract the investors, the practise of corporate
social responsibility are fruitful for company. As it attracts the new and existing investor to make
investment in their organisation. As sustainability is major issue in the globe market investors are
giving preference to those companies who developed environment friendly product. This
represents the social responsibility of the organisation towards the nature. CSR considered the
environmental, social and governance matrix which assist in external analyst in measuring social
efforts of the company towards mankind. This considered as major reason of consideration and
continuous interest of the the investors (Yeoh, 2019).
In determining the importance of CSR towards consumers, employees and stakeholders
various companies emphasis on the different kind of CSR such as environmental efforts: it
considered as one of the important reason of practising CSR by the organisation. Many
organisation at the time of developing products harm the environment by releasing carbon
Dioxide in the environment and many other hazardous gases which severally affect the
environment. So if the responsibility of an organisation to behave environment friendly. It
considered as one of the common form of CSR. While taking such initiatives company use the
concept of environment stewardship. Companies take such responsibility by taking various steps
such as reducing of pollution, emission of green house gases, the use of single use plastics, water
consumption and general waste, use of renewable energy, sustainable resources and recycled and
partially recycled materials. Reduction of negative environment impact such as planting trees,
funding research and donating to related causes (Flint, 2020). Ethical Responsibility considered
as other type of CSR in this an Organisation ensure such responsibility by functioning in fair and
ethical manner. Ethical responsibility adopted by the organisation with the purpose of achieving
just treatment with all stakeholders which includes investors, leadership, employees, customer
and suppliers. It can be adopted by various ways such as higher minimum wages, the raw
material which are required by the organisation can be sourced as per free trade standards. The
other one is Philanthropic Responsibility, considered as the purpose of the business is to make
the world and society as a better place. In addition to environmental and ethical CSR
organisation also focus on the philanthropic responsibility by donating the portion of earning for
charity and non profits purpose. Such donations are not directly related to their business but it
make to uplift the living standard of the people. For this organisation make charitable trust which
is accountable for all those philanthropic works. Last one is Economic Responsibility: It deals
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with the improving the business operation of the organisation. By adopting the concept of
substantiality in their business. For ex- Bio-been more the fuel for buses of London from the
wastage of coffee beans (Student, 2021).
Organisation consider certain points while creating social responsibilities in the business
model such as irrelevant initiative are not select by the company which are against the ethical
standard of the company. So the company should avoid those charitable efforts which are not
related to the core businesses of the organisation. The practising of corporate social
responsibility should not be used as a marketing strategy as it can backfire the business in case of
ineffective implementation of CSR. Companies introduce this concept for long period social
obligations it assist in gaining the faith of employees and consumers. Companies not depend on
the industry to take step in the direction of corporate social responsibility. If the organisation
considered that there is no legal requirement for sustaining the activities. Then, the company can
itself embrace the social responsibility in their business activities by setting out the standards. As
the practice of corporate social responsibility is nor only favourable for organisation but it also
beneficial for employees and consumers as it appeal towards social conscious.
Various legal frameworks at national and international are laid down for strengthening
the practices of CSR in the organisations such as guiding principle on business and human right
which are laid down by human right council of the united nations which is based on three
pillars, duty of state to protect, corporate responsibility and access to remedy (Parizek and
Evangelinos, 2021). As the second pillar focus on the responsibilities of companies not only
towards business activities but towards environment also. CSR helps in maintaining relation
among investors, consumer and stakeholders. The other one is guideline of OCED for
multinational enterprises which are laid down by members states for establishing cooperation
among companies, society and trade union the step of practising CSR is voluntary. The social
standard of ILO which work in the direction of improving the social standard around the globe.
By preventing companies from taking competitive benefits against the worker's right. The
another one is UN Global Compact which align the operation of business with labour, human
right, anti corruption and environment. It is found that there is not a single country which make
mandatory provision regarding corporate social responsibility except India. It is the sole country
which make mandatory law for practising corporate social responsibility by the organisations
under the company act 2013. Section 135 of company act 2013 state about the corporate social
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responsibility of the company. In UK there is no specific legislation for CSR which set out
specific obligation on the organisation. But in indirectly it mention in various legislation of UK
and it practice from many year like minimum wages act 1998 which guaranteed the prescribe
wages to the workers on hourly basis. Health and safety act 1974 it ensure the heath and safety of
the workers at workplace. And the equality act 2010 ensure the equality among all employees, no
discrimination should be made on ground of gender, race, part time and full time worker etc. so,
from these legal framework it can be said that in UK there is no specific law for CSR but the
concept of corporate social responsibility mention indirectly in various legislation of the UK
(Sivani, K.M.S., 2019). And the company of UK take voluntary steps in the direction of
practising corporate social responsibility in their business activities. For example, Ex- Starbucks
is well known organisation for effective practise of CSR it takes the initiative by granting
Starbucks youth action grant for supporting and inspiring youth action, Ethos water fund for
spreading awareness about clean water, ethical sourcing by purchasing coffee from ethical
traders, green building by using energy efficient products and conducting programs relating to it.
CONCLUSION
From the above essay it is concluded that, CSR is the responsibility of the corporations in
order to have a positive impact on the world. It consists of practices that are to be undertaken for
achieving the social objectives for increasing the profits of a corporation. It mainly aims to
makes it better day by day in order to serve the society. Corporate Social Responsibility lays its
focus on improving its relations in the public and enhancing its name in the market and society.
Business can have a positive impact in relation to improving its re;relationship with the
customers, establishing the name of the company with higher possibility of growth and
development. Therefore, Corporate Social Responsibility plays a major role in society in order to
impose a positive impact on the status of the company as a whole. It is committed to be socially
responsible for the improvement in society in order to lay a productive environment for
working.
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REFERENCES
Books and Journals
Bouzouitina, A., Khaireddine, M. and Jarboui, A., 2021. Do CEO overconfidence and narcissism
affect corporate social responsibility in the UK listed companies? The moderating role
of corporate governance. Society and Business Review.
Cvenkel, N.R., 2018. Employee well-being at work: Insights for business leaders and corporate
social responsibility. In Stakeholders, governance and responsibility. Emerald
Publishing Limited.
Deb, E., 2022. International Business Law-Critical Review on Corporate Governance in
UK. Available at SSRN 4074105.
Flint, D., 2020. Is the UK Adequate?. Business Law Review, 41(6).
Parizek, K. and Evangelinos, K.I., 2021. Corporate social responsibility strategies and
accountability in the UK and Germany: Disclosure of lesbian, gay, bisexual and
transgender issues in sustainability reports. Corporate Social Responsibility and
Environmental Management, 28(3), pp.1055-1065.
Sivani, K.M.S., 2019. Critical Analysis of the Effects of Regulations under Competition Law on
Mergers and Acquisitions: A Comparison of the India, EU, US and UK
Laws. Journal of Corporate Governance and International Business Law, 2(2).
Student, A., 2021. To examine the added value of implementing Corporate Social Responsibility
practices on the UK supermarket industry, a case study of Tesco PLC 2015-
2020 (Doctoral dissertation, University of Chichester).
Yeoh, P., 2019. Corporate governance codes in the UK: The risk of over-reliance. Business Law
Review, 40(1), pp.19-27.
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