Timothy S. Dunham
January 22, 2013
Professor Patricia Strauss
The role of corporate strategic planning has evolved from its sole motivation of generating profits for the company’s shareholders to incorporating the desires of the many stakeholders and society, in general, into the company’s operating game plan. This change of corporate culture is directly related to the rise of ethical codes of conduct in business and the growing importance of corporate social responsibility.
Corporate social responsibility (CSR)
Along with supporting the internal interests of a company, such as maximizing profits and stock price for shareholders and creating equitable workplaces for employees, corporate strategy is influenced by the desires of external stakeholders. Customers, creditors, the government, and the public all expect the company to act in a fair, ethical manner, especially with regard to their individual interests. Outside interests include low environmental impact, product safety, community service, taxes, and fair competition. Catering to external stakeholders and keeping in mind the welfare of society is a company’s role of social responsibility. “Corporate social responsibility is the idea that a business has a duty to serve society in general as well as the financial interests of its stockholders” (Pearce & Robinson, 2011, p. 47). Businesses represent sources of resources that may be used to make selective, positive impacts on society if they so choose.
The level of philanthropy undertaken by companies in promoting social responsibility ranges from simple donations for local causes to creating a whole new charity. Similarly, there are differential costs and benefits to supporting outside causes that a responsible company must take into account. Contributed money and resources subtract from a company’s bottom line and cut into profits but the benefits of acting in the interest of others can be...