Written by Subin Han
CSR (Corporate Social Responsibility) is a form of corporate self-regulation integrated into a business model. CSR has been an essential part in business management (Wood, 1991). People can find that the significance of CSR has been emphasized due to ‘social responsibility’ included in the 4 meeting agendas at 2010 G20 Business Summit. In addition, the CSR policy ensures its active compliance with the spirit of the law, ethical standards and international norms. The goal is to embrace responsibility for companies’ actions and encourage a positive impact through the activities on the environment, customers, employees, communities, stakeholders and all other members of the public sphere (Mallen, 2001). Furthermore, the theory is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of work condition for workforce as well as of the local community and society at large (Lord & Richard, 2000), which doesn’t mean to have traditional entrepreneurship for pursuit of their company’s profit, but to have a goal to solve social problems in the society by using corporate methods with the production and sales of their goods and services (Mallen, 2001).
In this paper, the author would like to imprint the potential business benefits of CSR on the public and allow them to figure out the influence. First, the reasons why CSR should be done will be analyzed and examined to encourage much more corporations to perform the responsibility than before. In addition, how companies apply the theory and their social and financial performance will be also introduced.
Essential Corporate Social Responsibility
While it was a rare phenomenon for corporations to be taken criticism when they make profits, unhindered except by fulfilling their duty to pay taxes in the past (Mark-Herbert & Schantz, 2007), they have much more social responsibility now. That is because, first of all, in this modern business environment, public opinion prefers enterprises accomplishing a social or financial purpose (Alter, 2002), so that a company’s reputation is one of its treasured assets and CSR (Corporate Social Responsibility) has become one of the key ingredients of corporate reputation. In this way, by implementing social responsibility, enterprises can create their friendly brand-image, which helps them to build up their brand power (Mburugu, 2011). So, this theory contributes to promoting a corporate stock price because in stockholders’ perspective, looking beyond short-term profit is increasingly important (Trapp, 2009).
Moreover, corporate managers should perform a social responsibility because the responsible action is right according to the business ethics (Hooker, 2003). Also, Mburugu (2011) refers the moral principle is beneficial for employee motivation because a favorable working environment can help the company to attract, retain and develop human resource, while enhancing operations and maintaining high staff morale. Therefore, CSR should be practiced by companies.
Enterprises pursuing Corporate Social Responsibility
There are some international companies that observe social responsibility in terms of managing ecofriendly, offering education and supporting the poor. First, in environmental view, Starbucks is a good example selected as the 100 best eco-companies by CRO (Corporate Responsibility Officer Magazine) 8 years in a row. Starbucks has made an effort by adopting Environment mission statement (1992) and minimizing their used coffee grounds. Thus, their coffee grounds have been provided in land improvement and in 2002 they implement their recycling program ‘Behind the Scenes’ that enables managers and employees in each store to know data about recycling and ‘Earth Day Network’ that educate children about the protection of environment. Also, McDonald's overcomes the...