Article Review - Csr and Its Effectiveness in Poorer Communities

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Article Reference

Newel, P (2005) ‘Citizenship, accountability and community: the limits of the CSR agenda’, International Affairs, 81 (3) May, pp. 541-557.

Objective of Article

The writer attempted to highlight the benefits and limitations of CSR, the challenges facing its implementation particularly in poorer communities that do not enjoy a good relationship with their local corporate industry due to the absence of strong state socio-economic agencies, poor legislation, and access to NGOs amongst other things.

The article sought to assess how CSR was being interpreted by companies and communities, the role state governments have played in ensuring that companies fulfilled their obligations and areas where improvement was needed.

The writer also looked at several community driven initiatives with a view to critically analysing their legality, effectiveness and justification.

Understanding CSR

The World Bank defines Corporate Social Responsibility as the “commitment of business to managing and improving the economic, environmental and social implications of its activities at the firm, local, regional and global levels. CSR can be used as a framework through which business engages in multi-stakeholder partnership for sustainable development.”1

Writer’s Concern (Issues Raised about CSR)

The writer observed that measures put in place to ensure that companies conduct their businesses in a responsible manner in the west have not been applied in developing countries. Some of these include economic, legal and ethical responsibilities required by states and international bodies like the World Bank Care International Business Partners for Development Scheme, World Economic Forum (WEF) Global Citizenship Initiative amongst others. The writer expressed concern that companies in some cases assumed CSR initiatives were just “one-off philanthropic projects instead of a set of strategically planned efforts consistent with companies’ own corporate strengths and complimentary to programs offered by the government.”2

The article noted that even where good CSR initiatives are in place, the sectors that set up industries in poor communities participate mostly in activities that usually have negative social and environmental implications (like oil spillage associated with oil exploration companies and other consequences of extractive activities) . However, due to the absence of well resourced global civil society organisations, lack of proper education /enlightenment in the communities, inadequate facilities to monitor their activities, it is usually difficult to implement these CSR initiatives.

The few ‘responsible’ corporate industries in developing countries also fail to properly dialogue with their host communities, assuring them of their commitment to the development of their regions and plans they have outlined. They instead engage in discussions with state officials and few ‘community leaders ‘who put their selfish interests ahead of their people. This leaves the communities with the impression that they are being oppressed due the power inequalities and makes them resort to measures like civil disobedience, violent protests many of which are counterproductive.

Also, some firms actually try to take advantage of ‘weak spots’ (like incentives, government provisions) within CSR targeted policies to make more money by saving costs and further neglecting their responsibilities.

Roles / Failure of State Governments and Agencies

The article noted that states governments in poorer communities do not adequately protect the rights of their people. This is usually due to: * Their failure to improve investment climate through the provision of better government. * Not ensuring transparency in the activities of the companies and in their dealings with them. * Failure to enact and implement binding laws and regulations that would protect the people and their environment. * Lack of resources...
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