MNG00724: HRM Policies and Practices for Responsible Business

This report delves into the crucial role of Human Resource Management (HRM) policies and practices in fostering responsible business operations. It begins by emphasizing the significance of sustainability and ethical frameworks within organizations. The report explores organizational ethics, Corporate Social Responsibility (CSR), and human rights, highlighting their interconnectedness and impact on long-term business sustainability. It discusses the Triple Bottom Line (TBL) approach, focusing on profit, people, and planet, and examines how HRM can integrate these factors into recruitment, training, and performance appraisal processes. The report emphasizes the importance of ethical considerations in all aspects of HRM, including fair wages, non-discrimination, and environmental protection, to ensure responsible business practices. The conclusion underscores the shift towards sustainable HRM, which balances economic, social, and environmental considerations to reduce ambiguities and promote responsible business conduct.

HOW DO HRM POLICIES AND PRACTICES PROMOTE
RESPONSIBLE BUSINESS PRACTICES
Introduction
The concept of sustainability and responsible business practice may be considered
to be e a Critical Success Factor (CSF) in a business organisational context. Since
business is primarily about dealing with people, the focus of business operation
should be on the human being. Therefore, the study of Human Resource
Management (HRM) assumes its importance in today's complex business world
where there is a constant drive to make a balance between economic as well as
social and environmental factors from operational viewpoint of the business. The
given essay deals with the fact of whether HRM policies and practice promote the
responsible business practice.
At the very beginning of the essay, the researcher provides a brief introduction to the
theme of the paper. In the subsequent part of the essay, the discussion on the given
topic has been undertaken and the concept of organisational ethics, Corporate
Social Responsibility (CSR) and human rights etc have been put forward. Thereafter,
the researcher attempts to interlink those concepts to conclude whether sustainable
HRM practice should be undertaken by the management to become a good
corporate citizen and thereby achieve long-term sustainability for the business in the
society.
Discussion
Organisational Ethics
The concept of organisation ethics is widely discussed in the realm of the study of
HRM. It is needless to mention that a business should be ethically sound and the
management and leadership should consistently focus on ensuring an ethical
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framework within the work culture of the business. In doing so, the organisation
should abide by not only the social norms, regulatory guidelines and environmental
directives but also emphasize human resource in terms of expectation, motivation
and holistic development. It has often been observed that ethically strong business
garners social recognition and thereby achieve a competitive advantage over others
in the long run. On the contrary, a financially efficient business may also lose its
brand value if there has been a breach of the social contract, moral obligation or
non-compliance by the business (Aust, Matthews and Muller-Camen, 2019). In short,
a firm should focus on balanced stakeholder management wherein the internal
stakeholders (such as customers, management etc.) should be nourished and
maintained for their development and future growth; on the other hand, the interest
of external stakeholders (such as customers, suppliers, regulators etc.) should also
be maintained with integrity and honesty (Wikhamn, 2019). The entire approach
forms the basis of organisational ethics.
Corporate Social Responsibility (CSR)
The concept of CSR is generally defined to the degree of responsibility of a business
not only towards economic consequence but also for social implication and
environmental consideration. The concept of social responsibility denotes the fact
that a business should not only put effort towards earning profit for its shareholders
but also prioritise its social aspect as well as the environmental issues so that the
operation becomes sustainable in the long run for the society as a whole. The term
may be understood by “corporate citizenship” or “sustainability” as well (What is a
corporate social responsibility – and does it work? 2020). In this context, it will be
wise to note that in earlier days, the primary aim of the business was considered to
be “profit maximization” profit that gradually got converted to “wealth maximisation”
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considering the non-financial impact such as quality of human resource as well.
However, in today's complex, technological advanced and globally rich business
scenario, it becomes critical for the management to add value to the business and
society and therefore the concept of “value maximization” has evolved. The concept
suggests that a company should put focus towards 3 P’s and the same is also known
as the Triple Bottom Line (TBL) approach (Hussain, Rigoni and Orij, 2018). This is
noted which are as below
Profit: Profit should be utmost necessary in conducting future operations. A cash-rich
company is in a much better position to satisfy the need of workers, suppliers,
customers and government by paying wages, dues, quality products and services
and taxes respectively. Therefore, the organisation should emphasize on the bottom
line of the business as to how to optimise the same by way of either enhancing top-
line or restructuring cost.
People: Since business comprises of people, the focus of the management should
also be on its shareholders, customers, suppliers employees etc. It has often been
observed that financially strong business organisation may lose its brand value and
reputation in the labour market due to its stringent working hour policy or lower
compensation level and therefore management should make a balance between
economic as well as the social aspect of the business concerning people.
Planet: The environmental factor is another critical consideration for the business
and the management should aim to adhere to the regulatory guidelines for
environmental protection. For example, a financially strong and people-centric
company may not sustain in the long run if there have been several allegations
against the business for its operation affecting the environment. The case of British
Petroleum’s “deepwater horizon” scandal may be cited here to denote the
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importance of environmental consideration in a TBL framework (Aust, Matthews and
Muller-Camen, 2019). The company had to pay severe penalties and its brand value
got adversely affected due to its non-compliant activity polluting the environment.
Responsible Business Practice
Considering the aforesaid discussion, it is stated that a business practice may need
to be responsible towards society as well as the environment. In this context, it is
wise to note that human right forms an integral part in such a responsible business
practice. For example, the issue of giving proper wages to the labour is viewed as an
economic viewpoint whereas the non-discrimination in the workplace and equal
participation may be viewed as a social approach. Similarly, access to clean and
hygienic drinking water due to sustainable business operation is a matter of human
right emphasising the environmental aspect of the scenario (Corporate Social
Responsibility & Human Rights | Australian Human Rights Commission, 2020).
Therefore, it should be noted that responsible business practices should involve
consideration of human right in all three aspects as discussed above and
incorporating the same in the organisation policy manual for the long-term.
Recruitment and selection
In conducting the recruitment and selection process, HR professionals should
consider sustainability approach and therefore organisational long-term strategy
should inculcate the HRM policies and procedures accordingly. The business should
employ a sufficient number of resources needed to conduct the operation so that the
issue of stretched working hours or excessive pressure may be abolished. Secondly,
emphasis should also be put towards the recruitment of people from the viewpoint of
equal opportunity employment. In this context, it is interesting to state that business
houses nowadays create several mandates within the organisational policy to
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incorporate the organisational strategic viewpoint to equal opportunity for both male
and female. The regulatory guidelines have also ensured that the Board should
include a minimum number of female directors in place. Thirdly, employees working
in non-revenue resources like legal, accounting and finance, administration etc
should not be neglected and a sufficient number of people should be employed in
those departments as well to take care of relevant functions to run the show with
responsibility (Diaz‐Carrion, López‐Fernández and Romero‐Fernandez, 2018).
Training and development
Training and development is another vital part of the HRM process. It may be stated
that any non-compliance may attract several consequences in the form of penalties,
withdrawal, cancellation of licence etc and therefore employee should be aware of
those consequences through proper training initiatives. Similarly, the management
should make specific provision for the development of employees within the
organisation by incorporating workshops focusing on both soft as well as technical
skills development and thereby enhance the employee morale and motivation level.
The approach is viewed as socially sustainable because of its inherent offering of
human resource development within a corporate context (Manzoor, Wei, Bányai,
Nurunnabi and Subhan, 2019).
Performance appraisal
In the case of performance appraisal, HR professionals may need to device
assessment process efficiently so that adverse reactions by the employees do not
arise. There have been several instances where employees have been agitated or
frustrated as they are not able to provide feedback, have standardized
communication protocol and therefore unable to let the concerned and higher
authority know about their grievance related to non-transparency in the appraisal
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process. Such scenario generates dissatisfaction and therefore methods such as
360-degree feedback or one-to-one interview session may help employees to
discuss the performance indicators with the management and complete an efficiently
designed performance appraisal process (Christensen, Hail and Leuz, 2018). Apple
Inc., for example, is known for its excellent value offering and customer service in the
industry. However, employees of the company often put allegation against the
company’s stringent work culture and the lack of clarity in defining job roles and
responsibilities. This scenario certainly creates a negative impression of the
esteemed business house in the respective industry to an extent (Aust, Matthews
and Muller-Camen, 2019).
Conclusion
The aforesaid analysis and evaluation may propose sustainable HR practice that is
somewhat different from that of traditional HR practices. The standardized HR
policies and procedures have always been put forward by HR professionals and
subsequently the same has been tweaked to match with the organisational strategy
sets and thereby a new horizon of strategic HRM (SHRM) has developed. However,
SHRM fails to answer concepts like dualities, ambiguities and dilemma in
standardized HR practices and therefore the concept of sustainable HRM derives its
relevance. For example, curtailment of labour cost may be viewed from an HR point
of view to add value to the organisation (Kramar, 2014). However, such curtailment
may also mean retrenchment to a certain extent which is not socially viable
proposition for the business in the long-term. Sustainable HRM tries to make a
balance between these two opposite alternatives and reduces such ambiguity by
focusing on responsible business practice.
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References
Aust, I., Matthews, B. and Muller-Camen, M., (2019). Common Good HRM: A
paradigm shift in Sustainable HRM?. Human Resource Management Review.
Christensen, H.B., Hail, L. and Leuz, C., (2018). Economic analysis of widespread
adoption of CSR and sustainability reporting standards. Available at SSRN 3315673.
Diaz‐Carrion, R., López‐Fernández, M. and Romero‐Fernandez, P.M., (2018).
Developing a sustainable HRM system from a contextual perspective. Corporate
Social Responsibility and Environmental Management, 25(6), pp.1143-1153.
Humanrights.gov.au. (2020). Corporate Social Responsibility & Human Rights |
Australian Human Rights Commission. [online] Available at:
<https://www.humanrights.gov.au/our-work/corporate-social-responsibility-human-
rights> [Accessed 6 April 2020].
Hussain, N., Rigoni, U. and Orij, R.P., (2018). Corporate governance and
sustainability performance: Analysis of triple bottom line performance. Journal of
Business Ethics, 149(2), pp.411-432.
Kramar, R., (2014). Beyond strategic human resource management: is sustainable
human resource management the next approach? The International Journal of
Human Resource Management, 25(8), pp.1069-1089.
Manzoor, F., Wei, L., Bányai, T., Nurunnabi, M. and Subhan, Q.A., (2019). An
examination of sustainable HRM practices on job performance: An application of
training as a moderator. Sustainability, 11(8), p.2263.
The Conversation. 2020. What Is Corporate Social Responsibility – And Does It
Work? [online] Available at: <http://theconversation.com/what-is-corporate-social-
responsibility-and-does-it-work-89710> [Accessed 6 April 2020].
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Wikhamn, W., (2019). Innovation, sustainable HRM and customer
satisfaction. International Journal of Hospitality Management, 76, pp.102-110.
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