Corporate Social Responsibility and Profit

This assignment examines the complex relationship between Corporate Social Responsibility (CSR) and a company's financial performance. It delves into various theoretical perspectives on CSR, exploring its potential impact on profits and brand equity. The assignment utilizes real-world examples, such as Marks & Spencer's sustainability initiatives, to illustrate the practical implications of CSR in business decision-making. Students are expected to analyze relevant academic literature and critically evaluate the arguments surrounding CSR's influence on profitability.

STRATEGIC
MANAGEMENT AND
CORPORATE SOCIAL
RESPONSIBILITY

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 2............................................................................................................................................1
2.0 Evaluation of CSR contribution to M and S success ...........................................................1
2.1 M and S stakeholder analysis................................................................................................2
2.2 CSR policy and supply chain sustainability in M&S............................................................3
TASK 3............................................................................................................................................5
3.0 Challenges and advantages of M&S production facility based in an emerging economy ...5
3.1 Triple bottom line..................................................................................................................6
3.2 Profits....................................................................................................................................7
3.3 People....................................................................................................................................7
3.4 Planet ....................................................................................................................................8
TASK 4............................................................................................................................................9
4.0, 4.1, 4.3 Recommendation with responsible selection of suppliers, human resource
development strategy and contribution in environment protection.............................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Strategic management is considered as the process which involves the formulation and
implementation of main goals and objectives initiatives taken by firm's top management on
behalf of owners. It is also essential for management to consider different internal and external
environment in which business competes so that desired results can be attained (Orlitzky, 2013).
Here, Marks and Spencer organization ha been undertaken which is a major British multinational
retailer headquarters in London. Company specialises in clothing, home products and luxury
food items. Thus, it is essential for business to undertake effective corporate social responsibility
practice and thus helps in improving focus upon corporate responsibility and sustainability.
Business aims to undertake such approach in regard to embed social and environmental
awareness and practices into its everyday strategic vision and does not affect the environment in
which firm is operating its business.
Further, in order to attain success within firm, it is essential for M&S to implement
effective CSR practices so that best results can be attained. Also, business needs to focus upon
prevailing environmental issues in the country and thus prepare the product accordingly so that it
does not affect the business functions. Employees within firm also needs to have clear vision
regarding understanding the goals and objectives and thus attain desired results in an effective
way. It is crucial for firm to follow CSR policy and thus attain desired results so that
environment could be protected from affecting. Marks and Spencer enhances its environmental
performance in regard to introduce more sustainable product and service and thus carry out the
trade practices so that it does not affect the environment. However, it aids in making the business
successful as well as compete with that in international market. Business also focuses upon
carrying out effective corporate social responsibility and thus enhance the brand reputation in
market to attract more number of customers and attain high profits.
TASK 2
2.0 Evaluation of CSR contribution to M and S success
Working with many suppliers together main sustainability of the company is depends on
its supply chain. In respect to considered retailer strategy, is very essential to future of the
company. M&S wants to take their operations according to customers expectations so that they
can take steps within the business accordingly. In addition to this, the company collaborating
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with food suppliers with using sustainable water which help them to contribute fair pay standards
within the enterprise (Jo and Harjoto, 2012). With the help of considered right things within the
organization, cited firm can create shape towards the enterprise performance so that they can
make sustainability within organization programme.
M&S launch their activity look behind the label, in which they highlight customers with
various ethical and environmentally methods that can be use by the firm for production and
sourcing for the company products. The chosen business face many challenges which are
responsible for sourcing the material from suppliers in various part of the country and another
nation as well (Attig, El Ghoul and Suh, 2013). With the help of CSR contribution, cited firm
make their products and services in considering selling of clothing, home products and luxury
food products in different areas. As results, chosen business can make suppliers more socially
and environmentally responsible. This would assist to make overall sustainability framework of
cited firm to take initiative within the company. In addition to this, it also covers legal and
ethical standards within the organizational products and services which business provides to
attain enterprise outcomes. They are ensures that products and services which the enterprise
offers to customers are very effective and good for them (Welford, 2013).
2.1 M and S stakeholder analysis
Stakeholders includes person, group of members and organization who create interest in
the activities and actions of a company. In M&S there are different types of internal and external
stakeholders take place within the business which are as follows:
External stakeholders
External stakeholders includes customers, communities, government and suppliers which effect
from cited firm activities (Grant, 2016). Following are the stakeholders consist within the
enterprise: Customers: Customers are the most important stakeholder within the company who
attract towards the M&S activities. Cited firm is retailer and their customers can be single
person or other business as well. They are part of the company success who create
positive advantages within the enterprise. In addition to this, they are also helps to
increase profits of the business through considering various activities (Armstrong and
Taylor, 2014).
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 Government: Government is another important stakeholder for the company who
demonstrate various rules and regulations for development of the enterprise. In respect to
this, M&S pay them tax which helps them to create positive relationship within the
organization performances. In respect to this, government make decisions which
significantly create major impact on the company operations (Toppinen and Korhonen‐
Kurki, 2013). Thus, chosen enterprise has responsibilities to make effective relations with
government so that they can enhance their new operations easily.
 Suppliers: Suppliers are the most critical stakeholder for the company who provide raw
material to the company to make finished goods. In this context, M&S create loyal
relationship with them so that it helps them to develop shared value, vision and goals for
the organization.
Internal stakeholder
Internal stakeholder of M&S can be grouped according to shared interests. Following are
the internal stakeholder consist within the organization: Investors: Main aim of investors is to gain profits from the business (Hill, Jones and
Schilling, 2014). In respect to this, they invest their money in M&S to create more
revenue within the organization so that they will easily attract customers to develop the
company market. Hence, cited firm fulfil their investors requirements which is primary
objective of them.
 Employees: Employees are the most important element within the organization who
create value for significant consideration for the company (Koh, Qian and Wang, 2014).
In M&S employees has two prime interest such as job security and high wages. As
results, with job security cited firm can make guarantee through business can make sure
job security to their employees so that they can make sustainability within the enterprise.
2.2 CSR policy and supply chain sustainability in M&S
Corporate Social Responsibility (CSR) policy consist rules and regulations which help to
develop social welfare from the company operations. It is used in M&S to integrate economic,
environmental and social objectives of the enterprise which assist to grow the company. Supply
chain of M&S consist various retailers which take place for better operations. Sustainability
programme is help to make effective results (ArAs, 2016). This is because, it creates step to
changes in global supply chain. CSR policy play very important role within the organization
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activities and sustainable sourcing. As results, financials incentives for chosen business can be
create major advantages within the effective supply chain of company. In respect to this,
business make successful production and reputation within the company environment.
Supply chain of M&S is take place in global environment in which they follow global
sourcing principles documents which create positive advantages within the company. The
principles are considered by CSR in which adequate clauses considered on forced labour,
freedom of association and discrimination from at the workplace (Shields, Brown and Plimmer,
2015). Thus, it can be stated that reasonable rating in supply chain considered stakeholder
engagement with the chosen business in which they can make their transactions effectively. In
addition to this, their supply chain is jointly create advantages within the company to making
high degree of community management.
M&S set high standards for making effective sustainability in the environment that
influence to the changes throughout the company. They make plan through considering ethical
sustainability activities and gathering support to company operations (Hopkins, 2012). Hence,
they can get positive results according to their reputation. In the supply chain of company, cited
firm make fair partner in the retailer's strategy which help to create ethical and environmental
standards to the future of organization.
Main aim of CSR is to protect the economy through make effective results for upcoming
people. It helps to consist welfare for local community services activities within the chosen
company (Ducassy, 2013). As results, it can be done in positive manner to attend various
challenges within the society. In this context, following activities considered by CSR in M&S
operations:
 Connect to whole world with contributing technology.
 Development of human resources of cited firm.
 Responsibility to customers, society, suppliers, employees, shareholders and local
community.
 Society and environmental consideration within the supply chain (Mahoney, Thorne and
LaGore, 2013).
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From the above activities within the chosen organization, they can make their
transactions in effective manner which help to create positive results. In respect to this, M&S can
make effective operations so that company will able to achieve their targets.
TASK 3
3.0 Challenges and advantages of M&S production facility based in an emerging economy
Major challenges face by cited firm is sourcing material from the suppliers in different
areas such as South Asia, i.e. India, Sri Lanka and Bangladesh. Manufacturing is the very
important and established industry that contribute major contribution within the GDP of country
(Campbell, Eden and Miller, 2012). However, M&S face many challenges which create
disadvantages for the business. Following are the changes face by chosen enterprise at the global
place of work:
 Acceptance of advance technologies of manufacturing.
 Adding high values in products and services to get importance of manufacturing
industry.
 Using advance knowledge, information and management in the organization.
 Sustainability in manufacturing and products of company.
 Innovation in products, services and processes.
 New manufacturing management paradigms (Zhang, Zhu and Ding, 2013).
Above challenges face by M&S which becoming more complex and dynamic in nature.
Complexity in manufacturing program increase process of the company and collaborative
networks. To overcome these challenges cited firm need to retain valid candidates who have
learning techniques within the organization environment. In respect to this, they can implement
many techniques which helps to make effective functioning within the business environment
(Hoi, Wu and Zhang, 2013). It can be affected by the various factors such as availability of large
amount of complex data with the transparency and power of available tools. New program within
the economy consist major part within the enterprise in which organization can analysis their
tools and techniques and strength and limitations as well.
Advantages of production facility
General advantages of the production facility in M&S is to establish solutions for
complete problems. In respect to this, they can focus on handling multi-dimensional data which
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implicit relationship within large set of complex and dynamic. In addition to this, company can
improve their resource utilization in manufacturing process and problems (Hsu, 2012). In
addition to this, it also provides quality improvements in complex data so that business can make
transparency in manufacturing goods and services. Production facility of the cited firm
considered following advantages within the firm:
 HR management system and process
 Labour standards and human rights
 No discrimination and provide equal opportunities to all members
 Health and safety
 Terms of employment
 Decent working conditions (Attig, El Ghoul and Suh, 2013).
3.1 Triple bottom line
Triple bottom line is an accounting framework which consist three parts within the
organization framework such as social, environmental and financial. It helps to M&S to evaluate
their performance in broad perspective to generate high value of the company. Below are the
elements consist within the triple bottom line perspective: Economic measures: Economic variable consist to deal with bottom line the flow of
money. It can be take within the cited firm to take income or expenditure, taxes,
employment and business diversity factors (Toppinen and Korhonen‐Kurki, 2013). It can
be includes, personal income, cost of underemployment, job growth and revenue by
sector, etc. Environmental measures: Environmental variable represent the measurement of natural
resources which influences to practicality. It can be integrated air and water quality,
energy consumption, natural resources and land use. It helps to identify impact of project
and policy on the specific area (Koh, Qian and Wang, 2014). In M&S example includes
such as electricity consumption, excessive nutrients, electricity consumption and
hazardous waste management.
 Social measures: Further, social measures consist as social dimensions of community and
region that could be include in measurement of education, equity and access towards the
social aspect of M&S. In this context, unemployment rate, relative poverty, average
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commute time and health adjusted life expectancy includes (Mahoney, Thorne and
LaGore, 2013).
3.2 Profits
M&S consist new and disclosed plans to retailing clothing and home ware business to
make changes within the company. In present year their profits are rising 4.3% to £689m. In
addition to this, their sales is fell by 2.9% in clothing and home ware division. Their plans is to
reduce the number of sales promotion from the various stores so that it is difficult to them to earn
more profits. Further, the cited firm is the largest clothing retailer in the country which has more
than 32 million customers in all over the world. The company has revenue over the £10.6bn from
the food products of company. In respect, their sales is grown by 0.2% every year. (Marks and
Spencer warns revamp plan will hit profits, 2016). Now chief executive of chosen business
wants to earn maximum of £1.8m on the top of basic salary in 2019.
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Illustration 1: Triple bottom line

3.3 People
M&S take participation actively through they can create deeper connection with the
employees and customers within the business. Their employees are around more than 82,900
across the world. In this context, major employees are take part in UK marketplace. Further, they
follow rules and regulations towards the employees in every year so that they can maintain their
operations effectively. In addition to this, cited firm always engaging and taking participation
through democratically involvement and work councils in which they create valuable knowledge
for the business activities (Campbell, Eden and Miller, 2012). For people of the organization,
cited firm adopt approach through they can protect them in effective manner. They can focus on
establishing clear minimum global suppliers standards which are proper towards the industry and
countries in manufacturing and supplying goods and services of company. The chosen enterprise
has responsibilities towards the business in which they are improving sustainability within the
organizational environment. In this, the business promote to working conditions of employees
towards the company goals They have also successful transactions through the enterprise can
create commercial success in which they are known about the issue of workplace (Hoi, Wu and
Zhang, 2013). For protecting the people of business following aspect can be taken by the
enterprise:
 Provision of medical insurance.
 Employee representation.
 Equal opportunities.
 Non discrimination at the workplace.
 Corporate ethics follow by company.
 Concentrate on working conditions of people.
 Offer reward system at the workplace.
3.4 Planet
M&S major retail enterprise of UK which deals with the company efforts to create focus
on environment aspect of business. Cited firm jointly owned for managing activities within the
14 stores. In respect to this, they are creates plan for development of the business in which
company make new stores in upcoming years around 29 million pounds. Main aim of them is to
create and increasing sourcing from competitive advantages within the enterprise (Orlitzky,
2013). In order to consist different element external and internal environment take place within
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chosen enterprise. It is top retailer which dealing in women wear and better quality of food
provider. In respect to this, they use resources which never harm to develop their operations of
company and environment as well. The company is awarded in year 2013 for making sustainable
business in respect to environment and energy. In this aspect, judges examines performances of
company, including waste, transport, energy, carbon mission and pollution control, etc.
(Welford, 2013).
In addition to this, M&S shown real and meaningful commitment to make sustainability
within the organizational performance for the development of enterprise. In this aspect,
sustainability strategy make clear results with real value for the enterprise. Hence, chosen
enterprise continually communicating with staff members and their stakeholder to create
effective strategy to ensure continuous program to development of the business.
TASK 4
4.0, 4.1, 4.3 Recommendation with responsible selection of suppliers, human resource
development strategy and contribution in environment protection
M&S operate their functions in increasing global society of the company in which they
offer various types of products in person life. They use most trusted brand in the products so that
they will easily develop their market in different part of the nation through considering suppliers
and producers of raw material. It will support to communities where organization make their
transactions (Grant, 2016). Thus, it can be recommend that organization need to demonstrate
responsibilities to ensure good working conditions throughout the environment in which they can
make effective supply chain. In this aspect, they are delivers fair pricing to suppliers which
support to local communities which making sure that every member of company working in
effective and good supply chain. With the help of human resource development strategy, chosen
business can deliver their effective results in which their products are made exclusive with
unique position in the environment.
Further, it can be recommend that M&S need to make cooperation with the members for
deliver effective quality in the products and services. In respect to this, they are not
compromising on quality in which they are maintaining competitive advantages at the price of
products and services (ArAs, 2016). In addition to this, company wants to make their profits very
high so that they need to increase their operations in various part of the countries and other areas
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as well. As results, they will easily deal with suppliers fairly and lawfully. Company has also
high risk within the environment issues so that they need to make effective functioning according
to social inequality which is more complicated within the firm. Another recommendation can be
taken as improvements in supply chain transparency so that they can make their improvements
within effective solutions. As results, the business can create important brand within the
organizational performances (Hopkins, 2012).
Main aim of the company is to enhance living standards of local communities so that they
will easily purchase high price of products and services of cited firm. In this aspect, M&S need
to identify customers requirements and selling their products accordingly. Hence, they can
improve sustainability within the chosen enterprise in supplying effective products and services.
Another recommendation can be taken as human right policy which need to be deliver to
customers in effective manner so that company will able to achieve more growth within the
business environment (Ducassy, 2013).
CONCLUSION
From the above report it can be concluded that CSR helps to cited firm to protect the
members of society for taking responsibilities at the workplace. In respect to this, CSR protect to
the chosen enterprise in term of taking advantages within the welfare of employees of firm.
Furthermore, it can be summarized that the business has two types of stakeholder considered
such as internal and external. In the internal stakeholder cited firm has employees and investors
are take place. Similarly, in external stakeholder suppliers, customers and government take
participation within the business for considering objectives of the company. Moreover, report
considered supply chain sustainability of the company in which organization can make their
development with increasing their profitability. At last, in this report covered recommendation
through cited firm can make their profits at very high level.
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REFERENCES
Books and journals
ArAs, G. (2016). A handbook of corporate governance and social responsibility. CRC Press.
Armstrong, M. & Taylor, S. (2014). Armstrong's handbook of human resource management
practice. Kogan Page Publishers.
Attig, N., El Ghoul, S. & Suh, J. (2013). Corporate social responsibility and credit ratings.
Journal of Business Ethics. 117(4). pp.679-694.
Campbell, J. T., Eden, L. & Miller, S. R. (2012). Multinationals and corporate social
responsibility in host countries: Does distance matter?. Journal of International Business
Studies. 43(1). pp.84-106.
Ducassy, I. (2013). Does corporate social responsibility pay off in times of crisis? An alternate
perspective on the relationship between financial and corporate social performance.
Corporate Social Responsibility and Environmental Management. 20(3). pp.157-167.
Grant, R. M. (2016). Contemporary strategy analysis: Text and cases edition. John Wiley &
Sons.
Hill, C. W., Jones, G. R. & Schilling, M. A. (2014). Strategic management: theory: an
integrated approach. Cengage Learning.
Hoi, C. K., Wu, Q. & Zhang, H. (2013). Is corporate social responsibility (CSR) associated with
tax avoidance? Evidence from irresponsible CSR activities. The Accounting Review.
88(6). pp.2025-2059.
Hopkins, M. (2012). The planetary bargain: Corporate social responsibility matters. Routledge.
Hsu, K. T. (2012). The advertising effects of corporate social responsibility on corporate
reputation and brand equity: Evidence from the life insurance industry in
Taiwan. Journal of business ethics. 109(2). pp.189-201.
Jo, H. & Harjoto, M. A. (2012). The causal effect of corporate governance on corporate social
responsibility. Journal of business ethics. 106(1). pp.53-72.
Koh, P. S., Qian, C. & Wang, H. (2014). Firm litigation risk and the insurance value of corporate
social performance. Strategic Management Journal. 35(10). pp.1464-1482.
Mahoney, L. S., Thorne, L. & LaGore, W. (2013). A research note on standalone corporate
social responsibility reports: Signaling or greenwashing?.Critical Perspectives on
Accounting. 24(4). pp.350-359.
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Orlitzky, M. (2013). Corporate social responsibility, noise, and stock market volatility. The
Academy of Management Perspectives. 27(3). pp.238-254.
Shields, J., Brown, M. Plimmer, G. 2015.Managing Employee Performance & Reward:
Concepts, Practices, Strategies. Cambridge University Press.
Toppinen, A. Korhonen‐Kurki, K. (2013). Global Reporting Initiative and social impact in
managing corporate responsibility: a case study of three multinationals in the forest
industry. Business ethics: A European review. 22(2). pp.202-217.
Welford, R. (2013). Hijacking environmentalism: Corporate responses to sustainable
development. Routledge.
Zhang, J. Q., Zhu, H. & Ding, H. B. (2013). Board composition and corporate social
responsibility: An empirical investigation in the post Sarbanes-Oxley era. Journal of
Business Ethics. 114(3). pp.381-392.
Online
Marks and Spencer warns revamp plan will hit profits, 2016. [Online] Available through:
<http://www.bbc.com/news/business-36376282>. [Accessed on 14th December 2016].
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