Analysis of Corporate Social Responsibility: Theories and Evaluation

This report delves into the realm of Corporate Social Responsibility (CSR), exploring its significance in business operations and its impact on income generation. It begins by defining CSR and highlighting its importance to both businesses and stakeholders. The report then examines key CSR th...Read More

Table of Contents
INTRODUCTION...........................................................................................................................2
Theories of CSR..........................................................................................................................2
The evaluation of company CSR.................................................................................................4
Conclusion..................................................................................................................................6
REFERENCES................................................................................................................................1
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INTRODUCTION
Social responsibility of business refers to the work the business owner does to make the
environment and social activities to improve. They do social benefits to make sure that
everything in the company is done in proper ethical and it is also done in social benefits. Social
duty of enterprise has got very crucial to capitalist and to user who seek a great chance of net
income and also contribute in benefit of organization, IT is also known as Corporate Social
Responsibility (Advantage, 2020). The study will explain the social responsibility of enterprise
in accelerative of income. The report further discusses the theories and information regard the
evaluation of topic.
Theories of CSR
The theory of Friedman vs. Freedman theory explains the concept of corporate social
responsibility in the workplace and its importance. Milton Friedman argued that the decisions of
the company is taken by the management and its final, and they do not need to ask anyone about
what they are doing and what are the impact can be on the business. Milton Friedman explains
that the decision is beneficial for the stakeholders and it's important to have a great business
profit. The way of working of Friedman have changed a lot of consequences in the workplace
and it also made an argument with Ed Freeman who explained that it is the rights of the
stakeholder and other employee to know the changes happening and the impact of decision is
wider and can also harm the employees and other stakeholder. To maintain a long term
sustainability (Jahn and Brühl, 2018), it is important for manager to not only thing of the benefit
of itself and it’s just not only the manager who need to satisfy their demands.
They need to consider the actions and their impact as it can harm and make a negative
impact on other business people and employees working in it. The development and making sure
that the decision can impact the working in a long run and it can cause a lot to organization in its
growth and development. If organization need to grow for a long-period than it is important for
them, to make every steps according to measuring of the actions and the reactions they can get.
The decision of the top management and stakeholder are directly impact the working of
the company and it can provide a great benefit for the company in growth. But on other hand it is
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important for the company to see the negative impact on the working of employee as some
decisions are including them and it can b making them difficult in working situation as they
understand the working better as they are working in front-line. The theory explains that it is
important for every person in the organization who can get affected of the decision taken by the
management or stakeholders ads it is there right and duty to Inform everyone about the decision
so that they can get ready and if they do not like then they can argue or inform about the reasons
that why they are not favouring the company decision (Freeman and Dmytriyev, 2017). Ed
freeman helped them in making a right information details as the employee and remaining
stakeholder need to know the company decision, Friedman on the other hand was arguing about
making decision by manager are beneficial for them.
Stakeholder theory explain the concept of making every person count in organization
and it is important for them to make them aware about the decision being taken which is
indirectly and directly affecting them in working. Stakeholder work for organization, and they
demand to be alert about any happening in the company and it can impact the working of the
organization. Stake holder theory also helps in explaining the process and importance of
stakeholders in the company. Both internal and external stakeholders are important for the
company and they need to make things developed for the company and help in growth and
success.
Tripple bottom line theory: - this is divided into 3 categories one is Economic measures,
Environment measure and social measures.
Economic measures:
Economic measure refers to the measure which is taken to measure the economic
situation and it includes all the flow of money. It looks in taxes, expenditures, income, etc.
 Personal income: - Company is providing a great help in income as they are giving great
income to those who are working for the company and also helping the company with
work.
 Employment: - They are helping development of the employment and helping a lot of
people with their employment strategies and providing a lot of jobs for people.
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Environment Measures:
In this the company is making sure that they are focusing on all the environment concerns
and taking measurement of natural resources and potential influence to the viability.
 Electricity consumption: - Company is making go green and saving a lot of energies by
making the offices working on solar systems and also making a lot of changes in working
to improve the ways and saving the electricity with auto cuts etc.
 Change in land and land covers: - company have abandoned those mining which are
affecting the environment and can cause the environment a huge impact.
Social measures:
All this activities which are linked to society and social purpose are included in it. It
includes the education, quality of life, social capital. Etc.
 Unemployment rates: -company is focusing in maintaining the unemployment rate to
decrease and every person to get employment.
 Relatively poverty: -making steps to reduce the poverty and making a great lifer for
every person who is working.
The example of Rio Tinto the company work in mining sector, and they were doing the
work in copper and gold in their Panguna mine site, the site was a mass producer of raw stock.
They are working so deep and not caring about the waste and that causes a lot of issue to the
nearby people who were living in that area (Valentinov, Roth and Will, 2019). It was all the
ignorance of management.
The evaluation of company CSR
The company works in the mining industry and working from a long period and they are
providing the copper and gold from there mining. The Corporate social responsibility is crucial
when operative for organizations whole maturation, the company works in change of all action
and raise the organization social action and helping of social benefit with the help of
organization profitability. Corporate social responsibility helps in development of business and it
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also increases the profitability of business which helps in doing all the CSR activities and
providing social benefits (Farooq Hao, and Liu, 2019). Companies plan to work in social benefits
and help the environment and socially to make the great changes in working. Mining giant Rio
Tinto has faced a lot of questions regarding their mine which is abandoned in the Papua New
Guinea two decades ago. Because of the poisonous wastage the mining was creating dumped
into the rives. The ignorance of management and the ignorance of stakeholders application in
regard to the working.
The incident happened due to the lack of management and ignorance of warning caused
a lot of damage to the people who were living near the mining area. The Mining giant had faced
a lot of acquisition on the mining of Papua new Guinea area as they were so unethical towards
the work that they were putting all the waste into the rives which cause huge damage to the water
and the people who were consuming that got infected and felt sick. People died and a lot of them
get sick. Around 12000 people got infected of water which was polluted by the mining. The lack
of management cause the mining in stoppage and the mine is abandoned from last two decades.
The workers working there have warned the owner that this working way can affect the people as
the water is getting polluted. The consumption of water into the near village was a huge area to
concern about, the management ignored and it caused a lot of issues and company get sue on it.
The negative results are caused of a lot of ignorance a miss management, they need to
understand that making the profit and money is alright but taking care of society and social
welfare is important so that they can work and does not harm anyone and does not lack in
business ethics.
Social responsibility of Rio Tinto:
 Plantation: - Plantation is one of the activities in which the mining giant works and help
in developing the go green campaign (Lestari, Hamzah and Maelah, 2019). It is important
and company is providing all the necessary materials to make this happens. Planting trees
helps the society in making the environment clean and helping in more of greenery.
 Cleaning the wastage of river: - Rio Tinto is helping in cleaning of the rivers which are
polluted and which need a better care. Company is proving all the necessary technologies
to clean the waste which is in the rives and making it more dangerous to people.
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 Wildlife Conservation: - Wildlife conservation and providing all the ways to develop
the wildlife and saving the wildlife and helping in conserving the wildlife. Rio Tinto
successful strategies in portion the wildlife and give wildlife in development and devising
the entire needed path in arrangement all the essential requirement.
 Charity: - Company is putting a lot of money in the charity and helping the needy people
in the country. They are paying and investing a lot in the charity so that they can help
more and more people out there. They are proving additional help like educations and
other help the person needed. Charity for the old age people and those who are not having
home or homeless people. Rio Tinto is putting a lot in the investment to give a better life
to those who need it. They are doing social welfare in larger context.
Conclusion
The report concludes that it is important for the company to make social responsibility
a part of working and also need to develop the ways to increase the company social activity to
help the needy people. The social responsibility is important to increase a lot of profit in the
business so that they can invest in social welfare and help the society in betterment and do the
social responsibility practices. The report advance code the state and the issues which belief
justify in improvement need to be understood.
The recommendation is that the company need to understand the importance of every
person working in the organization and their decision is important as they can affect directly and
indirectly to others as well. Making sure that every person knows the changes and able to
understand the situation and necessity of change.
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REFERENCES
Books and journals
Advantage, C., 2020. Corporate Social Responsibility. CSR and Socially Responsible Investing
Strategies in Transitioning and Emerging Economies, p.65.
Farooq, Q., Hao, Y. and Liu, X., 2019. Understanding corporate social responsibility with cross‐
cultural differences: A deeper look at religiosity. Corporate Social Responsibility and
Environmental Management. 26(4). pp.965-971.
Freeman, R.E. and Dmytriyev, S., 2017. Corporate social responsibility and stakeholder theory:
Learning from each other. Symphonya. Emerging Issues in Management. (1). pp.7-15.
Jahn, J. and Brühl, R., 2018. How Friedman’s view on individual freedom relates to stakeholder
theory and social contract theory. Journal of Business Ethics. 153(1). pp.41-52.
Lestari, I.B., Hamzah, N. and Maelah, R., 2019. Corporate Social and Environmental Strategy
and Reporting in Indonesian Plantation Industry. Indonesian Journal of Sustainability
Accounting and Management. 3(1). pp.84-94.
Valentinov, V., Roth, S. and Will, M.G., 2019. Stakeholder theory: A Luhmannian
perspective. Administration & Society. 51(5). pp.826-849.
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