Corporate Social Responsibility

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Corporate social responsibility is becoming a key initiative and an essential tool in the growth of multinational corporations and the development of third world countries throughout the globe. The two concepts can work hand in hand to provide benefits for all; however difficulties in regulating and implementing corporate social responsibility need to be overcome before effective changes can be made.

Definitions of corporate social responsibility can be somewhat varied depending on the perception and perspective an individual or group has towards the situation; the definition has also varied through time. In general terms, Manakkalathll & Rudolf (1995) define corporate social responsibility (CSR) as “the duty of organisations to conduct their business in a manner that respects the rights of individuals and promotes human welfare.” In contrast to this, Christian Aid (2004, as cited in Pendleton 2004) defines CSR as “an entirely voluntary, corporate driven initiative to promote self regulation as a substitute for regulation at either a national or international level.” Blowfield, 1995 indicates that through time, the definitions and explanations of CSR have become more positive, with increasing understanding of the benefits that can be obtained through successful implementation by organisations.

Pendleton (2004) suggests that the first CSR initiatives were a response to public pressure and media exposes of poor company behaviour. The aim of CSR was to show these people that companies were capable of cleaning up their act. Pendleton (2004) suggests that “contemporary CSR was christened by Shell in it’s response to it’s annus horribilis of 1995.” Monshipouri, Welch & Kennedy (2003) also outline this issue as a key turning point in which Royal Dutch/Shell in a completely socially irresponsible act, spilt hundreds of thousands of gallons of oil in a remote under-developed area in Nigeria; where the locals are still suffering from their ordeal to this date.

Today, manager’s sensitivity to the issue is a result of pressures from the public, from interest groups, legal and governmental concerns and from media coverage (Deresky 2006). There is much debate as to what is considered socially responsible, and it is difficult to conclude where to draw the line in regards to where a company’s responsibilities begin and end. This ‘grey area’ can be attributed in part to the lack of a moral standard that can be accepted across all cultures. One side of this debate presents ethics and ethical standards as providing the basis for the adoption of CSR codes by multinational companies. Levis (2006) describes company’s CSR codes as “self regulatory instruments that address the issue of their social, environmental and human rights externalities.” These codes are generally developed in cohesion with a company’s culture and what they deem as ethical. Manakkalathil & Rudolf (1995) define ethics as “the clarification of what constitutes human welfare and the conduct necessary to promote it.” The issue with ethics and CSR in the global marketplace is the ambiguity and difficulty defining a widely accepted mode of conduct or moral universalism. Differences in the societal values across the globe make it difficult to create a universally accepted code of ethical standards to abide by.

It is for reasons mentioned above, alongside other criticisms, that there is a lot of ambiguity, debate and criticism as to how as multinational corporation (MNC) should go about implementing a CSR code or plan both in their home country and overseas. Or even; if they should bother with such an effort. CSR however is an essential issue in this day and age for companies to place considerable emphasis on. Not only does CSR benefit development, particularly that of third world or developing countries, but it can raise the profile and bottom line of and organisation if implemented and adhered to sufficiently. Bennett (2002) suggests that international company...
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