Corporate Social Responsibility: A Crucial Element in Measuring Competitiveness

This article discusses the significance of corporate social responsibility (CSR) in evaluating a company's competitiveness. It explores the different levels of CSR, including economic, legal, ethical, and philanthropic responsibilities. The article also highlights the benefits of implementing CSR strategies, such as reputation risk management, brand differentiation, talent attraction and retention, and meeting consumer expectations. Additionally, it examines the role of CSR in investor pressure and employee engagement, as well as the importance of communicating about CSR activities.

MANAGEMENT

Introduction
Corporate social responsibility is a term which is used in order to describe the organisation`s
efforts to enhance the condition of the society. These efforts includes donating money to non-
profit organisations to implement the environmental friendly rules in the organisation. The
existence of effective CSR has become a crucial element in measuring the competitiveness of
the company (3blassociation.com. 2016).
Corporate social responsibility is measured from many perspectives such as how an
organisation integrates its socially beneficial programmes and activities in order to improve
the business culture and its model. CSR is implemented with an aim to achieve long-term
sustainable development (Petrenko, Aime, Ridge, and Hill, 2016).
Model of CSR
Mainly, four levels consider the “pyramid of CSR” which are described below-
Carroll`s pyramid is a framework which helps the organisation to meet the social
responsibilities.

Some of the important features of CSR pyramid are-
It is built on the basis of profit
An organisation must comply with the necessary laws and rules.
Philanthropic- the top of the pyramid includes philanthropic obligations that undertakes
several aspects such as sustainable development, corporate responsibility, and the
environment protection. These days, it has become mandatory for the organisation to give
back to the people in lieu of the resources they have used. On the other hand, some
organisations are stuck in creating pollution, exploiting the natural resources, and executing
unethical action to earn profit (Petrenko, Aime, Ridge, and Hill, 2016).
Ethical- these responsibilities are under the third level that help the company to remain
ethical in its acts or operate each duty in an ethical way. Ethical principles are applied to
several fields of the company such as each department of the organisation, competition with
the rivals, and considering the stakeholders.
Legal- business cannot sustain if they only earn money, it is necessary to comply with the
minimal rules with earning profit. Each organisation has to fulfil and obey the laws. These
laws relate to food safety law, employee wage act, and working environment law.
Economic- it is the obligation of the organisation to be profitable. It is the only way to
survive and sustain in the business environment for long-term. At first, it may look unusual to
think of profits as a social responsibility. At its origin, society sees the business enterprises as
the separate institute, which will produce and sell the goods that the society needs (Phillips,
Lee, Ghobadian, O’Regan, and James, 2015).
The 21st century CR surge

With the increase in challenges in the business environment, the companies have started
choosing unethical practises in order to stand first in earning profit. Therefore, selfishness of
businesses have affected the customers in the negative way. This has led to change in the
societal aspects and this has affected manufacturing and service companies. Now a days, a
business is perceived successful only if it accomplishes environment rules and political
regulations. In order to sell the products, an organisation has to get approval from both
developing and developed countries. For example- When pharmaceutical organisations raised
the prices of medicines and AIDS drugs then many people started attacking (Phillips, Lee,
Ghobadian, O’Regan, and James, 2015).
In highly dynamic business environment, all the organisations started operating in new
platforms in different aspects such as prices, industry, and the employees. Companies have to
fulfil the gap between the deficit and the sufficiency. For instance- the footfall for FIFA
matches started decreased since 2015 when the fan started knowing that the president as well
as the two important players of football were engaged in bribery and corruption (Jain, Vyas,
and Chalasani, 2016).
On the other hand, the survey conducted by IBM states that the expectation of people have
been rising continuously which force the organisation to individual needs and their respond
towards expectations. Moreover, with the invention of technology, it has provided
transparency for the information for both inside and outside the organisation. The business
environment have become highly surveillance, which has become loss for those organisations
who are deficit with CSR strategies (Petrenko, Aime, Ridge, and Hill, 2016).
Corporate responsibility and the media
Severe competition in the business environment forces the organisation to stimulate its
operations with pro-active approaches. Earlier, organisation just needed to control their

messages of the brands with the help of press releases but currently they also need to
acknowledge other constituents, which are directly or indirectly linked to the customers.
This brings both reliability and strengthen to the business organisations by creating a sense of
responsibility for the community by holding transparent and accurate conservatives through
media (Jain, Vyas, and Chalasani, 2016).
The upside of CR
Business enterprises can get various benefits by implementing CR strategies and approaches
in relation to various functions. For example- several organisation apply cost-cutting
strategies, which hampers the CR but Walmart successfully implemented sustainable benefits
by considering various strategic perspectives. It was successful in regulating low pricing of
products with more number of customers (Jain, Vyas, and Chalasani, 2016).
Reputation Risk Management
Every company come up with sustainable CSR report with its annual reports and financial
statements so that it will be able to manage its reputational strategy. Rupert Murdoch said,
“Our reputation is more important than last million dollars.” Business reputation decreased
due to various corruption scandals and environment accidents, which has led to get attention
of unwanted practices such as media, government, and courts (Jain, P., Vyas, V. and
Chalasani, 2016).
Therefore, there is a need to develop positive culture in organisation to drive its foundation
with genuine CR strategies that helps in opposing sorts of risks.
Brand differentiation
In highly competitive market, companies have started delivering several aspects other than
selling just the products. On the basis of value of ethics, companies are able to integrate its

ethical standards in the corporate culture which increases customer loyalty (Kim, Hur, and
Yeo, 2015).
Brands such as Intel developed its own culture according to the certain principles of ethical
values. Brand differentiation helps the organisation to develop the pro-active approaches in
order to comply with the competitive environment (Cha, Yi, and Bagozzi, 2016).
Talent attraction and retention
Before recruiting the employees, companies often check employee`s background. Companies
often retain those competent employees who will be efficient enough to make and establish
CR plans. Effective CR plans will establish positive image in the eyes of employees and
sometimes-good employees shape the CR strategy. This will lead to reduce the cost and
increase the productivity by strengthening the brand image and promoting the trust among the
employees (Misani, 2017).
Consumer values and expectations
Organisation can get motivation with the increasing consumer expectation in order to
undertake social activities while coordinating the marketing activities. In regards to ethical
and philanthropic, a customer always holds high expectations from the organisation. Certain
aspects will give importance to the association between several dimension such as ethics and
philanthropies with the CSR (Park, Kim, and Kwon, 2017).
Investor pressure: the development of socially responsible investing
SRI (social responsible investing) is defined as ethical and environment investing. While
conducting the annual meetings, it is the right of the shareholders to question and ask for the
sustainable reports of the company (Hond, Rehbein, de Bakker, and Lankveld, 2014).

Moreover, the concept of SSRI can be enhanced in three important ways such as community
investing, investment in several government organisation, and support of the stockholders. In
last years, SRI investments have been increasing and it has reached to $3.74 trillion in the
total of managed assets (Albuquerque, Koskinen, and Zhang, 2018).
Responsibility inside and out: employee association in CR
While considering the business corporations, HR is an important part for any sort of
company’s plans and practises. For any organisation, they are recognised as brand
ambassador. Workforce and skilled employees help to attain and fulfil various CSR practises.
Moreover, employees are crucial stakeholders and spokesperson for a business and also the
management that could increase the morale and at last reduces the turnover by engaging the
personnel for the strategies. For example- IBM conducts various brainstorming sessions that
define various sessions to engage employees with the CR issues (Phillips, Lee, Ghobadian,
O’Regan, and James, 2015).
Being green
CSR is not a new belief. It has been emphasized when various organisation started driving
unethical practises in competitive environment with an aim to make more profit. Certification
standards have been initiated so that organisation can think of going green.
If companies apply these social notions then the business performance will be improved and
increased to much extent. CSR is a deep type of green and it hover the awareness in the
community (Frederick, 2016).
Communicating about CR
Company has to ensure sustainability into the business culture by communicating certain CR
activities. This has become a vital aspect, which will awake the employees to construct

various CR programs. This will ensure transparency by interacting with the stakeholders for
the corporate goals, which need to be accomplished in the near future (Ali, Frynas, and
Mahmood, 2017).
Conclusion
CSR holds business accountability towards the stakeholders of the organisation. CSR
has become a strong base to evaluate the competitiveness of the organisation. Both small as
well as the large organisations are liable to fulfil their social responsibility. It is also used as a
defensive policy that help the organisation to stand in the competition with absolute
fearlessness.

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