Corporate, Social Responsibility And Business Ethics

Many believe that business entities should have an ethical duty to be socially responsible, to work towards increasing its positive effects on society while decreasing its negative effects. Many organizations look for opportunities to be socially responsible while also creating shareholder wealth.

Once a business realizes that it has gotten wrapped up in maximizing profit that it neglect ethics of care, the next step is to readjust and realign its core values internally and be more responsible to the environment in which they operate by showing societal care. Therefore, the aim of this report is to address the importance of realigning the business with ethics of care through involving in CSR activities, and as well as showing how these actions can impact on a company’s performance even if it may be demoralized in the society.

The benefit to business of good Corporate Social Responsibility is difficult to quantify as it varies depending on the nature of the enterprise. Some scholars believe that there is a business justification for CSR. That is, what is good for the environment and society will be good for company profitability. And studies have shown a slightly positive correlation between CSR and financial gain (Steiner and Steiner, 2006). However, as Freidmanism claims, the first responsibility of business is to make enough profit to cover the costs for the future. If this social responsibility is not met, no other responsibilities can be (Hargreaves, 2006). Therefore it is critical that CSR activities are included in strategy formulation and that the level of resources devoted to CSR is determined like any other strategy – through cost/benefit analysis. Corporations will not throw money away…they need to see it

Furthermore, there are several reasons why CSR is critical to modern business such as attracting and retaining employees, attracting socially responsible companies and reducing business costs. To start with attracting and retaining employees, it stimulates workers to increase commitments and productivities. Employees would feel meaningful by working for ethical company. In the second place, it helps to attract socially

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.

ITC Ltd has worked exremly hard to start several procedures that have led to compliance of the standards of social responsibility. ITC’s dealings within the tobacco industry have contributed to the increase in company revenues and the company has worked towards following the triple bottom line and giving back to society. Most, businesses pay little attention to their social responsibilities and make it part of their overall strategy, instead they concentrate more on financial benefits from the sales of products. Consequently, managing business in a socially responsive manner contributes to the best combination of business success and societal acceptance, trust and loyalty. Giving back to the community in ways that benefits only society such as planting trees to curb pollution and help the environment or using biodegradable materials in packaging can reap financial benefits to a company by building loyalty among the community. The notion of business ethics and corporate social responsibility is becoming a defining concept in all industries worldwide. ITC believes in the Triple Bottom Line philosophy where the performance and perception of a corporation should not be judged only on the basis of its financial statements or revenues, but its environmental and social performance as well. ITC is one of the only companies in the world to be carbon positive, water positive, and conduct solid waste recycling. ITC provides water to areas where water is very

In addition, having a better facility would entice more quality human resource thus will lead to productivity and efficiency of operation. Fourth, the company would properly manage its risk. Basically, “CSR contributes to social risk mitigation and better risk management through two means: by providing intelligence which identifies those risks, and by offering an effective means to respond to risks with an emphasis on managing relationships with stakeholders” (http://www.unescap.org/tid/publication/indpub2565_chap1.pdf, n.d.). Fifth, CSR can expands also its competitive advantage through innovation because of lots of opportunity which pioneers innovation that benefits both society, and the company’s competitiveness. Finally, it would direct to better access to capital. Most financial institutions are including or incorporating environmental and social criteria when assessing a certain project. Accordingly, most investors are looking CSR as an indicator whether they should place their money on a certain company or not. Therefore, CSR, is not only important to its stockholders, but also to the stakeholders since everyone is affected when a company conducts CSR.

It is a viable alternative to apply CSR in Corporate and management strategies to outclass competing companies. An organization by carrying out its ethical principles and convictions in their activities and propagating them via organizational network influences the relationship with shareholders, clients and employees. The application of CSR can lead to social benefits and legitimacy for the firm since it can consider itself as a coalition in which the different stakeholders participate to gain their own benefit. (Freeman, 1984).

Access to capital enables a company to grow and make timely investment. Companies with good CSR standing are likely able to secure equity and debt capital with most ease. The growth emphasis in Socially Responsible Investment (SRI) is a clear indication of likely future trends

CSR research has spent many years to promote company benefits in the regard of social responsibilities, so the CSR strategy consideration gained much importance in a firm working . Although CSR categories the responsibilities of a company but in real world it is not good due to three reasons, first the CSR categories are not differentiable, second CSR can be used as a moral substitute to hide the other

Corporate Social Responsibility (CSR) is a very controversial topic. A question that has been debated for the past few decades is; is it corporately viable to introduce social responsibility as a proposed addition to the work ethic of business organisations. As well as, if adopting the framework of corporate social responsibility would yield positive improvements for those organisations.

The notion of ethics deals with people’s behaviors within a company. Social responsibility involves a company’s moral obligations and the manner in which the organization makes its decisions. Although ethics and social responsibility are similar on a conceptual basis, each has its own unique characteristics that express their differences and its independence of the other. Ethics and social responsibility have to be present and coincide with one another for a business to be ethically sound.

Companies are under scrutiny from consumers and from the government and CSR initiatives are expected from companies. Investing in CSR will gain respect from people and consumers will be more likely to support companies who show that they care about issues they care about. Employees can defend the company to local communities and in the media and give the company good exposure by talking about their CSR activities. A good reputation can lead to higher sales and can attract new customers. Companies can attract talented employees by offering them a company that they can identify with and that shares their views on being a benefit society. This identification with the company will create an emotional attachment to the company. Employee loyalty will increase and they will want to remain with the organization and the company will save money due to decreasing employee turnover. An example of this would be Market Basket. The employees believe that the company is serving the community by providing jobs and economic growth, supporting local farms and vendors, and providing the best prices for

Utilitarian Theories and Kant’s Categorical Imperatives can be seen in the concept of Corporate Social Responsibility (CSR) (Arnold, Beauchamp, & Bowie, 2013). CSR concepts are a result of governmental regulations, a business desire to increase brand equity, a business desire to increase customer equity, to be ethically responsible, and to attract talent (employees). Other than fines imposed for violating federal laws, there are other factors that influence change within the business community. Many studies conducted show a correlation of profitability with a company’s that demonstrate ethical and social responsibility (Scarborough & Cornwall, 2013). Business entities demonstrate CSR to their employees, the environment, investors, and to customers.

Bovee, C. L., Thill, J. V. (2013). Business in Action Upper Saddle River, NJ: Pearson Education,