Pros And Cons Of CSR

The scale and nature of the benefits of CSR for an organization can vary depending on the nature of the enterprise, and are difficult to quantify, though there is a large body of literature exhorting business to

In short term, the enforcement of CSR will increase cost to the enterprises. For example, in the labor-intensive industries such as textiles, garments, toys, hats, and shoes, the CSR aspects of working environments and labor rights respect will result in an increase in production costs. This will initially have negative impacts on the competitiveness of some export industries. Thus, the comparative advantage in cost will diminish. But in the long run, the benefits will outweigh the costs.

After carefully examining different theories and case studies on the relation between corporate social responsibility and financial performance, evaluating and critically analyzing the topic was possible. Even though social issues have been questioned for years, yet only recently have it become a main issue that is usually addressed by companies and corporations (Ahen and Zetting, 2015). An increased demand in research on CSR has shown that some companies have reacted to this matter by investing more in corporate social responsibility as it increases competitive advantage (Crane and Glozer, 2016). CSR can be used as an aggressive business strategy and an efficient marketing tool in order to design and sustain a competitive advantage over competitors (Crane and Glozer, 2016). Corporations understood that in order to be able to function profitably and be competitive in a very competitive market they must

CSR is the commitment of a company to behave ethically and to improve its employee’s quality of life, while contributing to economic development. Companies are expected to work with CSR and it can be rewarding for both customers and companies. However, CSR can be damaging for a company if it is performed incorrectly. For example, if the organization`s CSR efforts are focused on areas

Based on my interpretation of CSR, I see it as a voluntary obligation that companies have promised to their stakeholders to fulfill by improving, or at least not harm, the environmental and social wellbeing. When companies engage in CSR, they voluntarily promise to, for example, carry the responsibility to protect the environment and take actions against bribe or other corruptive activities related to their business. It certainly has some positive influences to specific areas based on my knowledge gained from other classes; nevertheless, when judge CSR in the context of total impacts on our society and environment, it is obvious that CSR has failed its mission to lessen the negative impacts of business based on the evidences that provided by the author. Also, since there is a strong positive relationship between CSR behaviors and consumers’ reactions to a firm’s products and services, it seems to me, now, that CSR for the most companies is just a fancy cover that helps them to create or promote a good image and reputation. The recent case that shows the failure of CSR of Volkswagen even make me believe that CSR programs may be just a marketing or public relation exercise for many

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

Even though customers are a major key to success of any business, limiting CSR practices to an external group of stakeholder is insufficient. From the customers’ side, the focus is “on the corporate brand and its societal relationships with external constituencies.” (Lacey, Hensel 316). It is undeniable that implementation of CSR can attract the customers and lead them to be a significant are source of a financial gain. That is because CSR changes the way consumers behave in the market and alter their beliefs toward the company standards.” (Lacey, Hensel 316). Nevertheless, extensive focus on the social gains may cause the business to suffer financially. If that happened, the case is considered to be a failure of executing CSR. Again, this is a result of shifting all the business gears to benefit a sole group the stakeholders.

The concept of Corporate Social Responsibility is a relatively new in the management field and there is no single definition of it since everyone’s interpretation of the term is different. “Corporate Social Responsibility means something, but not always the same thing to everybody.” (Votaw, 1972, p.25) and from my understanding of the concept, CSR to me is “The voluntary business activities within the boundary of law that contributes to the wider community for a more sustainable environment”. Since everyone has a unique interpretation of CSR, the range of relevant CSR practices across businesses has been quite diverse as there is no such thing as features of CSR (Marcel van Marrewijk, 2003). Rising environmental and social concerns in

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

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.

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.

First of all, for some corporations the CSR is not their priority, the most common reason is because the practice of CSR will increase the cost of the company and decrease the profitability of the company. According to Sprinkle and Maines (2010) the costs associated with practice CSR separated into opportunity costs, sunk costs and recurrent costs. Opportunity costs defined as any activity that could not have been undertaken due to capital and labor being bound to the CSR activity, which might result in lost revenues. Secondly, although CSR can help the company build up their positive corporate image and good corporate citizenship, for some companies the process is too slow to see the benefit side of it, and it is a time consuming

CSR can improve the company’s reputation and branding and this in turn improves the prospects for the company to be more effective to attract new customers and increase market share.

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