The Influence of CSR on Atlas Copco's Performance Metrics

This report investigates the influence of Corporate Social Responsibility (CSR) on the performance measurement system, and financial and non-financial performance of Atlas Copco, a Swedish industrial company. The study examines CSR's role in achieving sustainable objectives, analyzing its impact on key performance indicators. It explores the concept of CSR, its significance, and identifies gaps in previous research. The report employs a study model with dependent, mediating, and independent variables, including CSR, a sustainability balanced scorecard, and a performance measurement system. The research methodology includes both quantitative and qualitative approaches, with data sampling. The report includes a literature review and references, providing a comprehensive analysis of CSR's impact on business performance, cost savings, and employee engagement.

The influence of CSR on performance
measurement system, financial and non
financial performance of company

Table of Contents
TITLE: ............................................................................................................................................1
INTRODUCTION...........................................................................................................................1
Literature Review.............................................................................................................................3
Significance of study........................................................................................................................4
Research Methodology....................................................................................................................5
REFERENCES................................................................................................................................6

TITLE:
The influence of CSR on performance measurement system, financial and non financial
performance of company. A case study of Atlas Copco.
INTRODUCTION
Corporate social responsibility is considered as an essential management system whereby
organisations integrate social and environmental concern in their business operations and
interaction with their stake holders (Corporate Social Responsibility, 2018). CSR is mainly
understood as a way through which an organisation can attain a balance of economy,
environmental and social imperatives. CSR is effective for measuring the performance of firm
through providing financial or non-financial benefits to the company.
Balance scorecard is identify as a management technique that assist the implementation
of corporate strategies in a successful manner. A sustainability balanced scorecard displays the
causal and better relation between the social, environmental and economic performance of
company. This concept is used by the company to maintain their financial and non-financial
performance.
Overview of Atlas Copco: It is a Swedish industrial company that was established by
Hans Straberg in 1873. It is a global industrial group of business located in Nacka, Sweden. This
company is mainly specialise in marketing of Compressors, industrial tools, vacuum solutions
and assembly system.
Aims
“The influence of CSR on performance measurement system, financial and non-financial
performance of company” A case study of Atlas Copco.
Objectives:
 To analyse the concept of Corporate social responsibility.
 To identify the significance of CSR activity in accomplish sustainable objectives. To determine the impact of CSR on financial and non-financial performance
measurement system of Atlas Copco.
Questions
 What are the concept of Corporate social responsibility?
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 What are the significance of CSR activity in accomplish sustainable objectives? What are the impact of CSR on financial and non-financial performance measurement
system of Atlas Copco?
5Gaps:
Gap analysis is identify as an effective technique that companies apply to identify what
steps required to be taken in order to turn its current state to its wanted, future state (Jo and
Harjoto, 2012). There are five gaps which are identified in this topic are determined as under:
Gap 1: First gap is that all the previous studies conducted on CSR does not indicate that it helps
firm in sustain in market for long run.
Gap 2: All other studies fails to indicate that Corporate social responsibility provide an
opportunity to company to stand apart from its competitors in the market and this is the second
gap.
Gap 3: Study and research carried out on Corporate social responsibility does not explore that
activities done by companies for development of society help in retain employees for long time
period.
Gap 4: Another gap related with present study is that other studies do not indicate
encouragement of corporate social responsibility help in save business cost which enhance
company’s efficiency.
Gap 5: Past studies and research fails to explore that when company implement the concept of
corporate social then it enhances employee’s engagement in company’s operations.
All these are the major gaps and for fill all these this study is conducted.
Study model: It is identified as a part of independent variable, mediating variable and
dependent variable. In the research topic, all three variables are present which are determined as
under:
Dependent variable: Corporate social responsibility is dependent variable in this study.
Mediating variable: Balance scorecard is a mediating variable in this study.
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Independent variable: Performance management system is a independent variable in this
study.
In this report, there are mainly three variables such as (CSR+SBSC+PMS), Corporate
social responsibility+sustainability balance score card+performance measurement system. All
these are interrelated with each other because in order to measure organizational performance,
company use different performance measurement system in which balance score card is effective
and essential tool. The Sustainability Balanced Scorecard (SBSC) concept is used to assess the
perceived importance of relationships between CSR and business performances to support the
goals of the case hotels. SBSC breaks the business down into five dimensions namely; Financial,
Customer, Internal Business, Learning & Growth and Non-Market Perspective, which is CSR in
this study. The sustainability balance scorecard is a best concept which is applied to assess the
perceived significance of relationships between corporate social responsibility and business
performance in order to assist the goals and objectives of the industrial company. Sustainability
balanced scorecard breaks the organization down into 5 parts such as learning growth, financial,
internal business, customer and Non-market perspective, which is corporate social responsibility
in this study.
Theoretical Framework
CSR refers to the Corporate social responsibility which indicate the activities perform by
a business entities for development of society and its members (Kim, Park and Wier, 2012).
Today, every individuals want their favorite brand to be involved in development activities so in
order to sustain in market for long run, it is very important for every company to invest some
funds in activities some under the concept of corporate social responsibility. It is very essential
that research should be execute in a better manner so that outcome can serve as a evidence for
the future research.
Literature Review
It is refer as a test of scholarly paper, which covers the actual knowledge including
methodological and theoretical contributions to a specific research topic. This section of the
research is based on research questions which are determined as under:
Concept of Corporate social responsibility
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Corporate social responsibility can be identified as an effective plan which is undertaken
by business entity to give some additional services or employment to the society. The emerging
the CSR concept goes beyond charity and needs the business act to act on the far side of its legal
obligations and to unified ethical, environmental and social concern into organisation's business
process (Reverte, 2012).
Significance of CSR activity in accomplish sustainable objectives
There are different benefits and importance of corporate social responsibility for Atlas
Copco. Some significance are determined as under:
Enhanced public image: This is essential, an customers assess their public image or
goodwill when deciding whether to purchase from them.
Cost saving: Different simply variation in lieu of sustainability, for example as applying
less packaging, will assist to reduce their production cost. Atlas Copco give compressed vacuum
and air equipments and solutions, power tools, air treatment systems, and rental solutions. In this
business use corporate social responsibility activity which is useful for them to save their cost.
Impact of CSR on financial and non financial performance measurement system of Atlas Copco.
CSR is an effective concept that has pull worldwide attention and acquired an innovative
meaning in the international economy (Saeidi and et. al., 2015). For example: sharp interest in
corporate social responsibility has reflected in maximised Atlas Copco business complexity and
unique demands for increased corporate citizenship and transparency. Furthermore, while legal
authority have traditionally acknowledged sole duty for the enhancement of the conditions
related to their living.
Significance of study
Activities done by a company for development of society, communities and environment
play a big role in growth and success. Further it affects company performance in market. In order
to perform well, it is very important for company to invest its resources in corporate social
responsibility. This enhance positive image of company and provide support to sustain in market
for long run. So it is very essential for Atlas Copco to invest financial resources for development
of society.
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Research questions:
Q1)What are the concept of Corporate social responsibility?
Q2)What are the significance of CSR activity in accomplish sustainable objectives?
Q3) What are the impact of CSR on financial and non financial performance measurement
system of Atlas Copco:
Q4) What are the relationships between Corporate social responsibility+sustainability balance
score card+performance measurement system?
Q5) What are the ways to improve Corporate social responsibility for enhancement of business
performance?
Research Methodology
Quantitative research: This is another type of research method and the main feature of
this is that under this data is collected in numerical terms. Different statistical tools such as mean,
mode, median and central tendency are used by research worker to examine the data. It is very
important for investigator to choose right tool for analyze the data as this largely affect the
quality of findings.
Qualitative research: Under this research method, researcher quality data in order to
highlight the finding related with the main topic of research. One of the main feature of this type
of research is that it provides an opportunity to research to analyze all the important element
related with the main topic of research and this help in draw valid conclusion. Researcher use
this research method for carry out an in depth study of research topic.
Data sampling: Sample refers to the number of respondents choose by researcher for
collect information related with the main topic of research. Various sampling methods are there
which can be utilize by research to choose a sample form the whole population such as
probabilistic and non- probabilistic sampling. Random sampling, part of probabilistic sampling
is chosen in this research and 50 respondents are selected (Servaes and Tamayo, 2013).
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REFERENCES
Books and journals
Jo, H. and Harjoto, M. A., 2012. The causal effect of corporate governance on corporate social
responsibility. Journal of business ethics. 106(1). pp.53-72.
Kim, Y., Park, M. S. and Wier, B., 2012. Is earnings quality associated with corporate social
responsibility?. The Accounting Review. 87(3). pp.761-796.
Reverte, C., 2012. The impact of better corporate social responsibility disclosure on the cost of
equity capital. Corporate Social Responsibility and Environmental Management. 19(5).
pp.253-272.
Saeidi, S.P. and et. al., 2015. How does corporate social responsibility contribute to firm
financial performance? The mediating role of competitive advantage, reputation, and
customer satisfaction. Journal of business research. 68(2). pp.341-350.
Servaes, H. and Tamayo, A., 2013. The impact of corporate social responsibility on firm value:
The role of customer awareness. Management science. 59(5). pp.1045-1061.
Online:
Online
Corporate Social Responsibility. 2018. [Online]. Available
through<https://www.investopedia.com/terms/c/corp-social-responsibility.asp>.
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