Advantages And Disadvantages Of Corporate Social Responsibility

In this review, the primary subject is the ‘business case’ for corporate social responsibility (CSR). The business

Every organized company worldwide should have among its structure, one planning and coordination division in which social and business goals are integrated. Corporate social responsibility (CSR) programs are necessary for commercial business as an element of risk management and represent an outstanding mechanism for the stakeholders to identify weaknesses when their own actions or others conduct in its operating environment generate social risk. (Kytle and Ruggie 2005).

Once the company have agree on the idea of CSR program, the company should do it in way that make connection between  what a company can do for society, and how it will affect its business. When a company like Coca-Cola, for example, contributes $88 million annually in different CSR programs or when Microsoft donates almost $300 million annually to nongovernmental organizations around the world there have to be some good explanation on why they do this and how it help the company image and position in the world. Nike in the other had they realize after getting burned by bad publicity because of attack of negative press and large-scale protests from those who claimed its contract employees were paid low wages and working in dangerous conditions in overseas factories. They have to invest time and energy into their CSR programs to reduce the negative environmental impact.

Corporate Social Responsibility (CSR) is something that affects all companies and should be an active factor in the company’s decision making. It is something all corporations need to care about. CSR is when business’ or corporations take part in an initiative or campaign for a cause that will benefit society and/or in some way make the world a better place (Taylor, 2015). Initially, Corporate Social Responsibility started to take shape around the 1950’s, but some say that it dates all the way back to the 1800s, the idea of CSR was seen (Carroll, 2007). One may think that because it is dated so long ago, it doesn’t have an important impact today nevertheless, it is proven that Corporate Social Responsibility is a pathway for entities to self benefit as they are in the process of benefitting society.

In this article, “The Truth About CSR,” authors Rangan, Chase and Karim stress the importance in aligning a company’s social and environmental activities with its business purpose and values (Rangan, Chase, & Karim, 2015, 41). Outcomes of CSR programs should be a “spillover” and not a primary focus of a business, expressing concern towards social responsibility and corporations failing to contribute to society accordingly (Rangan, Chase, Karim, 2015, 42). There is a great deal of importance in companies refocusing their CSR activities on a primary goal and in providing an organized process for bringing consistency and discipline to CSR strategies (42). Rangan, Chase and Karim want corporations to understand why it is important for them to evaluate their CSR activities and refocus them towards the goal of reinforcing the firm’s societal and environmental actions, while also ensuring their actions add to the overall purpose and values of the corporation. According to the authors, even though

The social responsibility of the American apparel industry covers responsible practices related to human rights, labor standards, and environmental sustainability. Some of the advantages of being socially responsible is higher revenue, customer loyalty, safe and happy laborers, and an overall healthy environment. Research conducted by Price Waterhouse Coopers found out after researching 1,000 retail companies 79 percent said that corporate social responsibility (CSR) was vital to the profitability and value of their company. Throughout the paper there will be a discussion of the advantages of being a socially responsible company. As well as the importance of

This recent reality, combined with globalization, is forcing companies to forge new kinds of relationships with buyers and countries. The financial valuation of companies are taking ever greater account of intangible elements, such as brands, patents and the company’s general image, with companies being bound to take account of these things in an effort to satisfy their shareholders. Environmental protection has become a highly motivating factor, and companies are being pressed to identify stakeholders with whom to team up. With brand value and reputation increasingly being seen as one of a company’s most valuable assets, CSR is now seen as building loyalty and trust amongst shareholders, employees and customers ( Tssa, (n.d.)).

1. It is hard for companies to communicate their efforts in CSR to shareholders and investors. Although companies have progressed from only 20% of public companies publishing CSR reports to 72% from 2011 to 2013, there are still no universal standards established for reporting CSR information. Therefore, even the best CSR efforts can lose their value simply because the efforts are not communicated to users of financial statements. This is also in part due to CSR efforts being ill-defined. While some CSR ideas are universal many of the aspects of CSR are industry specific and hard to translate into meaningful disclosures for interested parties.

Corporate social responsibility is raising concern in recent years. It becomes a key issue for most companies and organizations. Corporate social responsibility is important in the sense that it has strategic implications for corporations in different industries. Previous studies about corporate social responsibility usually explore the relationship between corporate social responsibility and financial performance of a business. However, in this study, the relationship among CSR, Corporate Image and Brand Equity is focused. The company’s activities based on CSR have positive impacts on its corporate image. Also, the more CSR bore by a company, the more positive image the company would have; and both CSR and corporate image would affect the brand equity as a whole. The attempt of this study is to examine the impact of corporate social responsibility towards the operation strategies of McDonald’s. By applying the model of CSR and identifying the relationship among CSR, Corporate Image and Brand Equity, the effects of McDonald’s CSR strategies are projected. The theoretical relationship among the

Organizational leaders can no longer focus solely on maximizing profits, however; organizations also need to participate in improving the community. Even during difficult economic times, members of the community expect corporations to invest in the development of society (Bilson, 2010). Through investment in the community, organizations benefit through enhanced reputation, competitive advantage, customer satisfaction, and ultimately, profitability. The benefits of CSR outweigh the costs that may be associated with CSR programs (Lou & Bhattacharya,

Companies need to be mindful of the changing world. CSR programs need to change accordingly. This does not mean that a company cannot hold fast to the core beliefs of its owners or shareholders, but a company may risk alienating a large segment of consumers if their CSR practices are not in touch with the times or do not concentrate on the pressing societal issues presently occurring. Right now in America and around the world there is a big push from all segments of society to be more environmentally friendly. If a company is not acting in an environmentally responsible way it risks severe backlash from consumers that could lead to an economic downturn that it cannot recover from. A good example of this is BP. After the Deepwater Horizon incident in 2010, BP’s reputation

With the spread of social marketing and CSR in the world, organizations tend to not only consider the consumers’ demands and the companies’ profit, but also take the consumers’ and societies’ long-term benefit into account. Hildebrand,D,et,al (2011) demonstrated that the CSR activities can make up the central, special and core characteristics of the company identity, the identification of the corporate can also be aroused due to CSR activities. Moreover, Porter and Kramer (2006) highlighted that CSR can aid companies create the ability to achieve corporate resource so as to build a sustainable and defensible competitive position. So the companies should consciously undertake corporate social responsibility.

Organizations are expected to actively analyze the impact of their operations on the overall financial and social systems in which they operate. Businesses should know expectations of the society and then manage their behavior and actions to yield results that address those expectations. The implementation of corporate social responsibility plan by an organization is an honor to humanity and nature. CSR discourages organizations from engaging in activities that threaten the life of people affected by its operations. An example is waste management strategies a company puts in place to ensure an appropriate disposal of by-products. Waste materials can pose health dangers such as cancer, contamination of water and food which may result in illnesses or even death of community members.

This chapter seeks to create a basic understanding on Corporate Social Responsibility. It answers the question what is CSR, how important is CSR to corporate, how it influences corporate practices, and what is Nike policy on CSR. These questions are important when trying to understand the general dynamics of CSR and why the company needs to embrace it for its survival. Knowledge of market trends in relation to Corporate Social Responsibility is crucial when trying to understand the policies and practices of individual organizations.

Many large corporations are taking corporate social responsibility into account and making it a part of their everyday schedule. Over the past decades, there have been increasing concerns for general society that many businesses have little concern for the consumer and they care nothing about the deteriorating social order. But these days’ companies are encouraging employees to volunteer and make a difference in surrounding communities. In this way they are supporting and improving the quality of life and enhancing the vitality of the communities in which they operate. There are many organizations that are encompassing CSR into their plan of action and also they are making new policies that can be beneficial for society. There are so many ways to incorporate corporate social responsibilities into business modules such as health, education, environment and helping in natural disaster.