CORPORATE SOCIAL RESPONSIBILITY: MAKE IT A PRIORITY

 SUZETTE N. ALEJANDRO

Divine Word College of Laoag                                  

ABSTRACT

Corporate social responsibility is a philosophy, a priority and accountability rather than merely a policy. Effective corporate social responsibility policies typically require organizations to commit to both an internal and external approach to ethics, although they do not automatically equate to lower profitability. However, what exactly does "corporate social responsibility" mean? Who is advocating for businesses to be socially responsible, and for what reasons? This article covers the progress of the CSR concept as well as some of the attempts to define the social responsibilities of businesses. This article also discusses the benefits of CSR and how to implement it effectively.

Keywords: Corporate Social Responsibility, Stakeholders, Consumers, Community, Employees, benefits of CSR, implementing CSR              

INTRODUCTION

The business serves both economic and social purposes. It is the only activity that has an impact on all facets of society and the country. Businesses innovate, create new goods and services for people, produce goods and services for the nation and society, and create new molecules to treat human illnesses. The business also creates jobs, generates income, exports, and collects taxes to help the government run smoothly. The business also makes use of the resources of society and the nation. But this only represents one side of the story; the other side is all about the exploitation of human and natural resources, sexual harassment at work, political funding of business interests, the spread of materialism and pollution, the encouragement of terrorism to increase the sale of weapons and ammunition, the sale of tobacco and alcohol, acid rain, global warming, and numerous other human rights cases of abuse.

More so, as discussed by Byars (2018), the environment and sustainability have been the concerns responded to by the corporations to their stakeholders. Corporations and customers are becoming more and more aware that their actions can and often inflict harm to the environment. Destruction of the environment can ultimately lead to a decrease in resources, limited business prospects, as well as a lowered quality of life. Businesses that harm the environment frequently conceal their actions to avoid being discovered and suffer financial loss, legal penalties, or social consequences. The Earth itself, which is affected negatively by their hidden actions, maybe the only testimony.

Moorhead (2016) stated that smart business executives must be aware that a stable foundation is necessary for a company to build and enhance its commitment to sustainability and corporate social responsibility (CSR).

CSR DEFINED

What is CSR, one would begin to wonder. Simply defined, it is essentially giving back to society. CSR, however, is defined by the World Business Council for Sustainable Development as "the ongoing commitment made by businesses to act ethically and to contribute to economic growth while strengthening the quality of life of employees and their families as well as those in the community and society."

More so, social responsibility refers to the business decisions and actions that are at least partially made for purposes other than the organization's immediate economic or technical interest (Mittal 2008). Most CSR activities are related to sustainability, environment, safety, and gender issues (Tian et al., 2011).

Additionally, CSR also refers to an organization's efforts to address a wider range of social and environmental issues and concerns (Lindgreen et al., 2010).  Also, CSR is generally understood to be “beyond what is required by law”, i.e. beyond legal conformity (Buhmann, 2006).

Corporate social responsibility (CSR) is also known by several other names. These include corporate responsibility, corporate accountability, corporate ethics, corporate citizenship or stewardship, responsible entrepreneurship, and “triple bottom line,” to name just a few. As CSR issues become increasingly integrated into modern business practices, there is a trend towards referring to it as “responsible competitiveness” or “corporate sustainability” (Hohnen 2007).

SOCIAL RESPONSIBILITY OF BUSINESS

            No business can run its own in complete isolation. A business depends on a variety of interactions with its stakeholders, which include its shareholders, customers, employees, suppliers, communities, and others.

According to Mittal (2008), there are four significant groups that both influence and are influenced by business, and business is expected to recognize its responsibilities towards these groups. These categories are:

1.0 Responsibilities to Shareholders

Not all corporations have the luxury of not needing shareholders' cash. Many do need capital from equity investors. They frequently represent the new, expanding businesses that we all want to see more of. These businesses might stay in low gear or never even get moving without shareholders who are ready to take risks that a bank or a bondholder would not (Fox et al., 2012). Shareholders who have invested in businesses have only one interest: making money. They have invested money to make money. Thus, organizations' main duties include increasing shareholders' wealth, providing a good return on investment, paying dividends on time, protecting the interests of even small shareholders, listening to and respecting shareholders, and regularly inviting shareholders to participate in decision-making (Mittal 2008).

2.0 Responsibility to Employees

            Employees have a key role in the success of the company. Employees are no longer considered the organization's most underutilized resource. As stated by Costas, J., & Kärreman, D. (2013), CSR functions as a method of aspirational control that binds employees' ethical conscience to the organization and aspirational identities.

            Organizations have many obligations to their employees, including fair treatment, no bias based on sex, cast, or creed, equal pay, fair and performance evaluation system, a pleasant and secure working environment, establishment of equal employment standards and norms, the provision of job welfare facilities, equal chances for accomplishment and promotion, proper recognition, appreciation, and encouragement of special skills and capabilities of the worker, and provision of labour welfare facilities.

            More importantly, all employees must be given the chance to participate in managerial decisions regarding appropriate and desirable training and development programs, allowing workers to grow as individuals in response to the changing environment.

            Finally, consider family well-being. That is, if employees' home lives are less problematic, their productivity will be high (Mittal 2008).

3.0 Responsibility to Consumer

Consumers are generally aware of a company's CSR behaviour and its impact on the environment and the community (Tian et al., 2011). Consumer interest in corporate social responsibility (CSR) has increased over the past ten years (Carrigan and Attalla 2001).  Several reasons for this have been advanced: On the supply side, businesses are becoming more involved in CSR activities and place greater focus on promoting their CSR efforts while, on the demand side, consumer advocate groups are highlighting unethical corporate behaviour and encouraging boycotts (Snider et al. 2003). More so, consumers actively seek out goods from companies that conduct business ethically as they become more conscious of the value of social responsibility (Collier 2018).

            Organizations have many obligations to their customers, including the following: to offer products of known quality; to ensure that products are delivered to customers and to prevent any form of profiteering by middlemen and fraudulent individuals; to provide goods at reasonable prices; to offer necessary after-sale services and to ensure that spare parts are available on the market;  to fulfil its commitments impartially and courteously following applicable laws; to ensure that the product supplied has no negative effects on the customer; to hear and address the genuine complaints of the customer; to hear and address any type of cartel formation, and finally, to provide sufficient information about the product, including their adverse effects, risks, and care to be taken while using the products.                                                      

            More importantly, consistent research and development are essential for enhancing and innovating the offered goods and services (Mittal 2008).

            Note that companies who consistently adhere to high standards for the safety of products and services have a significant competitive edge over their rivals (Benoit, 2013).                     

4.0 Responsibility to Community

            Communities are interacting with corporations more frequently now than in the past, a development supported by the reduction of trade barriers through international trade agreements, attempts to strengthen the rights of foreign investors and broader processes of national liberalization across many developing nations (Newell 2005).

            Simply, the business has a variety of responsibilities to the community: to prevent environmental pollution and to maintain ecological balance; to increase operational efficiency; to support research and development; to promote small-scale industry; to promote the development of the region in which they operate; and, finally, to take steps to conserve limited resources and to develop alternatives, whenever possible (Mittal 2008). 

BENEFITS OF CORPORATE SOCIAL RESPONSIBILITY

            The advantages of CSR speak effectively about how crucial it is and why you should try to implement it in an organization.

            Collier 2018 stated some clear benefits of corporate social responsibility which are:

1.0   Improved public image. This is important since customers consider your reputation when determining whether to buy from you. Simple things like employees giving an hour a week to a charity demonstrate your company's commitment to doing good. As a result, consumers will view you considerably more favourably.

2.0   Increased brand awareness and recognition. If you're dedicated to moral behaviour, this news will get around. Your brand will become more widely known as a result, of raising brand awareness.

3.0   Cost savings. Your production expenses can be reduced by making some easy modifications in the direction of sustainability, such as using less packaging.

4.0   An advantage over competitors. You distinguish yourself from rivals in your sector by embracing CSR. By taking social and environmental considerations into account, you position your organization as one that is dedicated to going above and beyond.

5.0   Increased customer engagement. You should announce your use of sustainable systems loud and clear. Create a tale out of your efforts and post it on your social media platforms. Additionally, you should showcase your work to regional media in the hopes that they will cover it. Customers will pay attention to this and interact with your brand and activities.

6.0   Greater employee engagement. Similar to consumer involvement, you should make sure your staff is aware of your CSR initiatives. It has been demonstrated that workers prefer to work for a company with a positive public image over one without. Furthermore, you'll be far more likely to attract and keep the best candidates if you demonstrate your commitment to causes like human rights.

7.0   More benefits for employees. When you embrace CSR, your employees might get a variety of advantages. By encouraging activities like volunteering, you foster both personal and professional development and make your company a more positive and productive place to work.                                                                                                               

IMPLEMENTING CORPORATE SOCIAL RESPONSIBILITY

            How is CSR implemented? Small and large enterprises alike should both invest in CSR. When we hear the term CSR, we often picture expansive, international programs that both large and small firms may find difficult to implement.

Collier (2018) cited some corporate social responsibility for small businesses and these are getting involved with local communities like participating in local events, attending fiestas, patronising and buying from local suppliers; volunteering; going green or reducing the amount of electricity used and recycling and upcycling of used materials; alternative transport methods like embracing the benefits of carpooling and taking public transport to work; and lastly to support the development of employees, ensuring that your employees feel happy, healthy, and safe whilst at work.

These are the suggested steps by Hohnen (2007) on how to implement CSR in large companies, first to develop an integrated CSR decision-making structure; prepare and implement a CSR business plan; set measurable targets and identify performance measures; engage employees and others to whom CSR commitments apply; design and conduct CSR training; establish mechanisms for addressing problematic behaviour; create internal and external communication plans; and lastly to make commitments publicly.

CONCLUSION

            Indeed, corporate social responsibility (CSR) is a philosophy, a priority and accountability. It is simply defined as essentially giving back to society. An organization must conduct itself with a sense of social responsibility. It is seen as good practice for the business to consider social and environmental issues, even though it is not required by law. CSR implies that a company cares about broader societal concerns as well as those that influence its profit margins, which will draw clients who share their beliefs. As a result, conducting business sustainably makes sense.         

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