Corporate Social Reponsibility of the Tobacco Industry

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  • Topic: Tobacco, Corporate social responsibility, Business ethics
  • Pages : 6 (2074 words )
  • Download(s) : 200
  • Published : August 12, 2012
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According to Harvard University, corporate social responsibility (CSR) is a business strategy that encompasses the ways in which an organisation manages its economic, social and environmental impact. As such, the methods of managing an organisation’s impact can decide whether the organisation is ethical or unethical. There are eight principles stated in the Global Business Standards Codex (GBSC) which assist in the assessment of ethics of an organisation or industry (Paine et al. 2005). These principles of the GBSC set the standard in an economic, social and environmental sense which all organisations in the global economy should adhere to. Therefore, the tobacco industry’s (TI) use of CSR strategy is unethical. This is because the TI’s use of CSR fails to adhere by the transparency, dignity and citizenship principles of the GBSC. Nevertheless, there are advantages and disadvantages of the TI using CSR strategies which benefit the stakeholders. Hence the CSR strategy used by the TI is nevertheless a valid strategy in the sense that this strategy improves the TI’s unethical public image.

The TI is breaching the transparency principle by using CSR strategies to create a façade so that it can be perceived by the general public as an ethical industry. This is in violation of the transparency principle as the TI is not conducting business in an open and truthful manner. However it can be argued that the TI isn’t required to enclose all information and that adhering to the Global Reporting Initiative (GRI) index is legally enough (Global Reporting Initiative 2012). By meeting the minimum requirements of the GRI index, major tobacco companies can maintain their competitive advantage by not revealing their marketing strategies which the transparency principle would require.

Nevertheless, the TI has been professed as an industry which solely focuses its resources on maximising profit which disregards the health of its users let it be first hand or second hand (World Health Organisation 2004). Epidemiology research by English & Spencer (2007) has shown that using the TI’s products if used as directed results in cardiovascular, respiratory, malignancy, reproductive and visual diseases which may lead to death. Hence these courses of events which include published epidemiology research which state that using TI’s product increases the chances of cancer have generated the ethical issue of TI misusing the CSR strategy. Hence, due to increased awareness by the general public on dangers of smoking (Office on Smoking and Health 2001) and a rise in tobacco related deaths, (Proctor et al. 2011), the TI has pursued the CSR strategy to improve its public image.

The TI is using CSR strategy because it has created a bad reputation due to its products being deemed as unsafe by major research organisations (World Health Organisation 2004). Therefore, the TI needs to change its public image from unethical to ethical to sustain profits and stay a profitable industry. The ethical issue present is that the TI is misusing the CSR initiative (Friedman 2009).To warrant that this unethical behaviour won’t happen in the future, the TI, which includes its managers and employees, must inform the public of their genuine intentions. This would make the TI transparent hence its CSR strategy would adhere by the transparency principle thus making it ethical. The TI’s CSR is a strategy which it is using to increase profitability and not contribute to the human development and wellbeing. This information is unknown to the general public. Therefore it can be concluded that the TI is engaging in unethical activities while misleading public to perceive otherwise. This leads to the conclusion that even though this CSR strategy has resulted in increased profits in the long term (Hirschhorn 2004), the TI’s use of the CSR strategy is ultimately a breach of the transparency principle regardless of it improving TI’s public image and thus makes the TI an unethical...
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