Strategic Management: CSR Concept and Cisco Case Study Report

This report delves into the concept of Corporate Social Responsibility (CSR) within strategic management. It begins by defining CSR and tracing its evolution from the 1920s to its current prominence, highlighting key arguments for its development and adaptations over time. The report then examines the evolving views on CSR, including its role in creating ethical business standards and addressing societal challenges. A significant portion of the report focuses on Cisco's CSR practices, analyzing its approach to employee relations, ethical conduct, and stakeholder engagement. The analysis assesses the relevance of CSR in contemporary business, providing insights into its strategic implications and benefits, such as enhanced reputation and employee motivation. The report concludes by emphasizing the importance of integrating CSR with other strategic management concepts for firms seeking sustainable and socially responsible operations.

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Student name:
Institutional Affiliation(s):
Course title:
Year:

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Table of Contents
Executive summary.....................................................................................................................2
Part One.....................................................................................................................................3
Introduction............................................................................................................................3
Evolution of CSR...................................................................................................................4
Role of CSR in today’s businesses.........................................................................................7
Part Two.....................................................................................................................................9
Company overview.................................................................................................................9
CSR in CISCO........................................................................................................................9
Conclusion............................................................................................................................10
References................................................................................................................................10

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Executive summary
Corporate social responsibility is one of the strategic management concepts that has
gained much popularity in 21st century to address contemporary business challenges
worldwide. This report will examine evolution the CSR concept by identifying its evolution
and arguments for its creation over time. This report will note any new adaptation made and
how CSR is been utilised by organizations alongside finding counter-arguments as present in
literature. After evaluating CSR concept, this report will focus majorly upon Cisco’s CSR
practices, supplier relations and employee stakeholder’s relationship to analyse whether
implementation of CSR is relevant in contemporary businesses or not. This paper concludes
that business firms that undertakes CSR activities have many benefits and thus recommends
that firms should pay keen attention to CSR by integrating it with other strategic management
concepts.
Part One

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Introduction
The CSR or Corporate social responsibility concept in strategic management can be
defined as a managerial obligation for taking actions to improve and protect both welfare of
organizational interest and society as a whole. The idea behind introducing CSR is to make
businesses responsible while carrying activities and consider societal and stakeholders’
benefits beyond shareholders of the company. Gaining prominence since 1960s, CSR have
secured much attention in both business practices as well as in academics throughout the
globe (Wang, Tong, Takeuchi & George 2016). Though there had been many debates and
criticism for making it a part of core strategic management, increasing consideration for it
among corporates have proactively made CSR address local and societal challenges thereby
creating organizations dedication to run businesses in effective manner and within social
obligations.
Evolution of CSR
CSR can also be regarded as corporate conscience or corporate citizenship and is
responsible for forming self-regulation in business models. In literature, CSR acts as a
mechanism in which businesses ensures active response and what is been demanded by law
alongside following ethical standards and international and national rules. CSR programs
encourages firms to undertake activities that can impact stakeholders and environment
positively other than benefitting investors, customers and other communities. Its origins can
be dated way back in between 1920 and 1930s when business practitioners started assuming
responsibility for making a balance between profit creation and maintaining equilibrium with
consumer demands, community and labour force (Agudelo, Jóhannsdóttir & Davídsdóttir
2019). This led business managers being viewed as trustworthy source in organizations and
henceforth other external relations of the company started undertaking economic and social

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responsibility. During World War II in between 1950 and 1960s, many organizations began
to be viewed as institutions comprising social responsibility and CSR started getting adapted
in more and more companies. Among all, the approach of Bowen gained much significance
as he was the first academician who focussed upon the CSR doctrine and therefore called as
“Father of Corporate Social Responsibility” (Agudelo, Jóhannsdóttir & Davídsdóttir 2019, p.
4).
Since 1960, many businesses and stakeholders got attracted towards CSR benefits and
started discussing about CSR and how it can create ethical business standards in
organizations to affect society and environment. According to Islam, et al., 2013, “Davis,
(1973) and Mintzberg (1983) states that business has responsibility beyond just making
profit” (p. 171). Accordingly, the authors started raising stakeholders and managers were
considered as responsible beings who maximises utility rather than seeking profits only. In
1979, Carroll concluded that social responsibility includes economic progress i.e. business
being profitable, legally and regulation compliant, ethical and philanthropical responsibility
for fulfilling broader civic society purposes like cultural, educational and recreational
responsibility. Apparently, CSR became a term used against legal and moral responsibilities
when in 1984 when Freeman proposed that organizations must fulfil every need related to
external individuals or groups that can be affected by organizational operations. Moreover,
moral obligations in stakeholder’s theory found in corporate stewardship theory added a new
dimension to business ethics and the CSR suggesting that organizations must focus
exclusively on their social responsibilities and duties without regarding financial
consequences due to such activities (Islam, Salim, Choudhury & Bashir 2013).
The growing interest of stakeholders since past three decades and complex globalised
businesses have pushed integration and development of social responsibility into business
activities throughout local and global industries irrespective of sizes and geographical

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contexts. According to (Mosca & Civera, 2017), possible actions and diverging views of CSR
emerged over time where CSR is been viewed as a distortion of economic purpose of
companies to more positive ones like making business organizations as a medium for
worldwide social development. Some of the scholars take CSR as utilitarian and as an
instrumental strategy that creates competitiveness alongside improving firm’s reputation and
brand consciousness among consumers (Asemah, Okpanachi & Edegoh 2013). On the other
hand, some of the scholars believe that CSR is very static and represents an achievement only
instead of being an innovative or flexible procedure to improve continuously and therefore,
have recognised failures in its strategic intent. Nevertheless, many business practitioners
consider CSR as an intended way that can make their organizational activities sustainable and
socially active.
In 1994, John Elkington introduced Triple Bottom Line theory that shaped CSR
practices for future expansion and to contribute economic, environmental and social value
creation in firm’s strategic management (Mosca & Civera, 2017, p. 19). The propagation of
norms and standards made the CSR more pragmatic concept in business strategic
management. Such approach reached its pinnacle in last two decades and gained momentum
amongst business practitioners and academia. Alternatively, CSR has become a controversial
and debatable topic among scholars and business practitioners where they argue that strategic
approach to CSR costs can fall disproportionately especially upon small businesses (Galant &
Cadez, 2017). Bigger organizations can afford allocating separate budget for reporting CSR,
but small businesses face many obstructions to monitor and promote socially responsible
activities. Księżak, 2016 claims that, “Some corporations can be also accused of hypocrisy”
(p. 62). Organizations which profess CSR concepts can involve themselves in corporate
abuses such as environmental destruction, exploitive labour conditions, complicity of
exploitive routines and inadequate process and products safety. Simultaneously, such

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organizations create illusion of CSR compliances rules where in real world, they develop
public relationship promotions while exploiting their corporate powers.
Role of CSR in today’s businesses
Following the global tendency, organizations are showing more concern towards CSR
by promoting corporate changes that has more strategic implications and are associated with
core competencies to make CSR an effective part of the business. According to Filho, et al.,
2010, strategic management is referred as a decision-making norm that determines
organizational objectives, plans and policies to achieve strategic goals. Such business
strategies define why does a company runs, its economic and non-economic standards and
contributions towards society, stakeholders’ interest and employee’s welfare. Today,
corporations deal with diversified businesses, enables mergers and acquisitions, business
alliances etc. where CSR has become indispensable part of strategic management as every
decision of companies involves economic and social consequences that remains
interconnected. Therefore, in present literature it has been cited that business executives and
strategists must take into account every societal decision and expectations as they can prove
attractive alternatives when service or goods for society are been considered. When managed
efficiently, CSR related projects and programs often provides organizations with significant
benefits like high returns and reputation alongside motivating employees to work more
(Jhawar & Gupta, 2017).

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Figure: Carroll’s Pyramid of CSR
With time, various CSR theories evolved out of which three most discussed ones are
stakeholders, institutional and corporate social responsibility performance theory that are
been practiced by contemporary organizations to meet business related challenges. Gradually,
many companies established corporate identity through brand promotion that became focal
point for their competitive advantage and success. Carroll’s CSR pyramid started with
economic responsibility following legal, ethical and other discretionary duties and with time
Carroll’s model became necessary for every business (Carroll, 2016). Due to constant
changes in business environment, managing ethical and legal responsibility has become very
challenging for organizations and CSR is the only way that can match corporate operations
with required societal parameters. As such, CSR has become a prerequisite for corporate’s
strategic management and highly relevant for today’s business world to establish sound
corporate identity.

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Part Two
Company overview
Cisco Systems Inc. is one of the leading companies dealing in internet networking
founded by two computer scientists who seek easier and faster ways to connect with different
computer networking’s. At present, Cisco provides services throughout the globe to small
business and government agencies, educational institutions and corporate companies. The
company’s vision is to connect people, computer network and computing devices to allow
people transfer or have an access over information without regarding any difference in type
of computer device, place or time. According to company reports, 85% of internet traffic is
generated across Cisco’s systems to run online business-like inventory management, products
ordering and staff communication. Cisco’s CSR strategies can perhaps prove to be a great
example and a framework for other companies to ensure that CSR can be implemented
without being involved in costly affairs and can rather prove cost effective strategy while
expecting societal and economic responsibility.
CSR in CISCO
Reduced staff turnover has always been an issue for corporate business. Similarly,
Cisco faced a sharp drop in its share prices in 2011 when it announced cutting of 10,000 jobs,
constituting around 14% of total labour force. This made company fall under suspicion for
exploiting company’s stakeholder’s interest i.e. employees that made other rivalry companies
think about Cisco having an internal managerial issue. Major fall of staff turnover was due to
periodic shift from networking and internet companies in 1990’s thereby leading Cisco into a
fully developed and a competitive company (Mourdoukoutas, 2012). However, to address

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employees related issues, Cisco introduced Employees code of conduct that responds and
evaluate human rights problems in its business management on every day basis. The Board
itself discusses human rights problems with its employees and invests significant amount to
promote activities and policies to meet human rights globally. Employees policy includes
ethical and moral principles like freedom of association, child labour, non-discrimination,
wages and work hours. In fact, the company complies to ‘United Nations Universal
Declaration of Human Rights’ to treat its employees with dignity and respect (CISCO, 2015).
For instance, the company’s Ethics resource Centre provides discussion forum to address
online communication business related issue by including training session and ethical
compliance policies for employees. Managers are been advised to handle any cyber security
issue ethically so that they are eliminated without violating personal information of the users
(Moorhead, 2016).
Another business challenge faced by Cisco includes emerging trends concerning CSR
among people that have made company difficult in managing and executing competitively in
challenging environment. Finding malware encrypted on networking traffic is a big challenge
faced by CISCO other than facing environmental challenges for smooth running of the
business (Sun, 2016). To stay ahead of the attackers, the firm attacks its own enterprise by
penetrating into products and systems through testers. Such operations helps in uncovering
vulnerabilities that can be resolved before anyone else can use it to exploit critical data. For
example, to address security issues security while safeguarding consumer stakeholders’
interests, the company sent 500,000 internal phishing test emails to their own employees that
raised awareness about phishing techniques and incoming threats to them (CISCO, 2017).
With the help of Cisco Networking Academy, the firm has been able to reduce various CSR
related issues by investing upon skilled-labour forces and providing technological training

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and assessments to encourage students and employees for enabling problem-solving attitude
at workplace
Conclusion
The amount of consideration given to CSR is vast that makes it latest social
expectation for generating shared values as core business objective. The above report finds
that despite undertaking various ethical initiatives and responsible activities, Cisco has faced
various CSR challenges in past few decades. Most of the challenge faced were due to ethical
lapses that made Cisco’s business practice fall into suspicion by its stakeholders. However,
by implementing CSR in its core strategic management, Cisco has been able to outperform
every business challenge pertaining CSR and law. Nonetheless, the future of CSR in Cisco
can consider latest technologies and advanced communication system as a part of business
framework. The adaptation to new digitalization tools and processes alongside artificial
intelligence in Cisco’s strategic management can prove more relevant to avoid future
challenges not only for addressing CSR issues, but also in enhancing other strategic
management concepts.

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References
Agudelo, M. A. L., Jóhannsdóttir , L. & Davídsdóttir, B., 2019. A literature review of the
history and evolution of corporate social responsibility. International Journal of Corporate
Social Responsibility, 4(1), pp. 1-23.
Asemah, E. S., Ruth , O. A. & Edegoh, L. O., 2013. Business Advantages of Corporate Social
Responsibility Practice: A Critical Review. New Media and Mass Communication, Volume
18, pp. 45-54.
Carroll, A. B., 2016. Carroll’s pyramid of CSR: taking another look. International Journal of
Corporate Social Responsibility, 1(3), pp. 1-8.
CISCO, 2015. 2015 Corporate Social Responsibility Report. [Online]
Available at: https://www.cisco.com/c/dam/assets/csr/pdf/CSR_Report_2015.pdf
[Accessed 17 08 2019].
CISCO, 2017. 2017 Corporate Social Responsibility Report. [Online]
Available at: https://www.cisco.com/c/dam/assets/csr/pdf/CSR-Report-2017.pdf
[Accessed 17 08 2019].
Filho, J. M. d. S., Wanderley , L. S. O., Gómez , C. P. & Farache, F., 2010. Strategic
corporate social responsibility management for competitive advantage. Brazilian
Administration Review, 7(3), pp. 294-309.