The Social Capital Theory ( Sct ) And Stakeholder Theory

Businesses, specifically larger corporations, play a major role in what occurs in society therefore, they are responsible to their stakeholders not only to pursue economic goals but the greater social good as well. Corporate social responsibility (CSR) means that a corporation should act in a way that enhances society and its inhabitants and be held accountable for any of its actions that affect people, their communities, and their environment. (Lawrence, 2010). Social responsibility is becoming the norm so much so that some businesses have incorporated it into their business model. There are three components of the bottom line of social

Traditionally the business objectives of business were to maximise profits, sustainability, and shareholders’ value but after the advancement of stakeholder theory there has been a radical shift in the business objectives towards meeting stakeholders’ expectations in addition to maximisation of profit. Typical stakeholders of a company except shareholders are customers, employees, and suppliers. Today modern business objectives are to meet expectations of stakeholders as much as possible. Corporate social responsibility has emerged as a phenomenon that is born out of stakeholder theory.

The purpose of this essay is to research the notion of CSR and uncover its true framework and outline what social responsibility truly means to corporate organisations, and whether it should be seriously considered to be a legitimate addition to the corporate framework of an organisation.

The term ‘corporate social responsibility’ is still in popular use, even though competing, complementary and overlapping concepts such as corporate citizenship, business ethics, stakeholder management and sustainability are all vying to become the most accepted and widespread descriptor of the field. At the same time, the concept of corporate social performance (CSP) has become an established umbrella term which embraces both the descriptive and normative aspects of the field, as well as placing an emphasis on all that firms are achieving or accomplishing in the realm of social responsibility policies, practices and results. In the final analysis, however, all these concepts are related, in that they are integrated by key, underlying themes such as value, balance and accountability (Schwartz and Carroll 2008), and CSR remains a dominant, if not exclusive, term in the academic literature and in business practice. Just to illustrate how the concept is always evolving, CSR International, a non-profit organization, announced in 2009 the birth celebration of CSR International, an exciting new organization supporting the transition from what it called the ‘old CSR’ (Corporate Social Responsibility) or CSR 1.0 to the ‘new CSR’ (Corporate Sustainability & Responsibility) or CSR 2.0. Whether CSR 2.0 turns out to be substantially different

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.

CSR manifests itself in many different ways. Businesses need to be aware of their commitments to all their stakeholders – customers, their community, suppliers, employees and, more grandly, the environment in which they

In a competitive business environment where consumers are increasingly aware of their buying power, they are asserting their right to not only demand quality but hold companies to account to high standards. They are concerned with where the goods were originated, the conditions under which the goods are manufactured and what ethos a brand stands by. It has become crucial for a business to be built on ethical practices in order for an organization to maintain its success. Over time the idea of CSR just being an unnecessary expense has shifted, with it coming as far as being called out as a, ‘definitively important strategic issue’, Businesses now see CSR as a method of generating and protecting income through creating a good brand image and customer loyalty.

Various authors have different definitions of what Corporate Social Responsibility. According to Lorde Holmes and Richard Watts, 1998 in their publication ‘Making Good Business Sense,’ they define CSR as “the continuing commitment by businesses to behave ethically and contribute to

Among modern century more companies are being interested about corporate social responsibility (CSR) as business reports proved that it became a fact in business growth. CSR is a mechanism accomplished to maintain the economic, legal, and ethical responsibility to the community as same as organization. Stakeholder theory enables managers to take account of these different interests in business ethical responsibility:

Leading community businesses and governments admit Corporate Social Responsibility (CSR) as an official policy objective. Those companies who apply CSR are able to maintain sustainable progress. This development covers social, economic and environmental influence in how they run (Clegg, 2011, p. 216). Three areas are the bases of the triple bottom line (TBL) approach (Elkington, 1994). CSR itself has various meaning but in more simple way it can be defined as firms’ obligation to act ethically and to facilitate elaboration. Thereby they try to make employees’ life better and likewise help to demonstrate a positive impact on local society. Therefore businesses are responsible for two factors of how they operate. Firstly, they should be concerned about the quality of management including people and operations. Secondly, they have to consider the character and amount of their effect on community in different fields. External stakeholders take a huge concern on how an organisation acts whether they perform well in their products, services, and society or not. Moreover they take an interest in how they care towards the workforce (Baker, 2004). The following paper demonstrates the major reasons of why businesses should take CSR seriously and what advantages does CSR have when they use it. First aspect will be related to reputation and brand image. Then it will be followed by strategy of cost reduction. Third aspect will explain the approaches to gain a competitive

Businesses have a responsibility to give back to the customers they serve and the communities they operate in. Today, many organizations have realized the importance of corporate social responsibility (CSR) in response to consumers and stakeholders becoming more mindful of social issues. Corporate social responsibility has continued to change and grow. It can be difficult to define CSR because it takes on a variety of social, economic, political and environmental formats depending on the business. Corporate social responsibility in the broadest sense is viewed as for-profit organizations becoming ‘good corporate citizens’ (Salton & Jones, 2015).

Corporate social responsibility spans across the globe, but different countries see and participate in CSR in different ways. Amerinda Forte, author of “Corporate Social Responsibility in the United States and Europe: How Important Is It? The Future of Corporate Social Responsibility,” an article published in 2013 in the International Business and Economics Research Journal, explains CSR using three traditional models: the shareholder value model where profits are the sole responsibilities of the business, the stakeholder model where the social responsibilities of the business reflect those of the stakeholders, and the business ethics model where businesses have social obligations and a moral duty to society as a business. The author

In a recent time companies are giving more attention to develop a CSR (Corporate Social Responsibility) and mainly their core values. Core values are used in marketing strategies (Berry, 1999) also in customer-retention management in order to create distinctive, long-lasting relationships with customers (Prahald and Ramaswamy, 2004; Normann, 2001) and stakeholders (Pruzan, 1998; Post et a, 2002). The interaction with a stakeholder and concerns a business operation use to understood CSR as the voluntary integration of environmental and social, but it has failed to discuss and analyse CSR explicitly from the perspective of stakeholders (Andriof et al,2002; Post et al,2002).

This research has primarily emphasized the importance of CSR to both individuals and the community at large, but one question remains underexplored: how do consumer perceptions of CSR line up with their concurrent expectations from the company? The literature shows little agreement; definitions are murky and left to individualized scholars, and evaluation of company’s efforts, as previously discussed, are difficult to present to major shareholders within a company, to say nothing of informing consumers.

Consequently, “in a world where power has shifted from the public to the private sector, the expectations which society has in relation to the environmental, social, and ethical responsibilities of companies have risen”. CSR has quickly moved from a domain typically associated with anti-corporate non-governmental organisations (NGOs) and activist campaigners into a mainstream business issue which is now “a critical determinant of trust in companies”. With this development, CSR itself (also referred to as corporate citizenship) has naturally taken on a number of different meanings. Although these definitions are similar, when attempting to identify the essential components of a successful programme for improving corporate social responsibility it is important to explore the similarities and differences among the definitions used. To that end, some of the more common and generally accepted definitions of CSR are as follows: