Corporate Social Responsibility

Topics: Corporate social responsibility, Social responsibility, Triple bottom line Pages: 6 (1845 words) Published: October 9, 2013
Critical Essay Assignment topic
Explore the notion of Corporate Social Responsibility and discuss some of the contestations of this phenomenon in contemporary organisations. Purpose of the study
Business is considered as the wealth-creating establishment of the society with its primary social role being producing goods and services that satisfy the daily needs of the people. Business also creates job opportunities and generates investment returns to the people including the ones preparing for retirement. Thus, they turn out to be demanding and valuable social role. Corporate social responsibility (CSR), also known as corporate citizenship is a kind of corporate self-regulation combined into a business model. The CSR policy behaves as a self-regulating and a built-in mechanism by which a business observes and assures its complaisance with the ethic standard, spirit of law and the international norms. The term CSR or “corporate social responsibility” came into use in the late 1960s and 1970s after a lot of multinational organisations coined the term stakeholder, which means those impacted by the organisational activities. Freeman (1984) claims that CSR is used to describe the corporate owners beyond shareholders which include the employees, environment, consumers, stakeholders, communities and other members of the public sphere. Proponents argue that the organisations tend to make long term profits while operating with this perspective but the critics like McWilliams and Siegel (2000) demonstrated in their journal article that the CSR has a neutral impact on the financial outcomes of the organisation. Some even suggest that is just a window-dressing and an attempt to anticipate the role of the governments as a watchdog over powerful companies. Henderson (2001, p. 171) claimed and illustrated the way in which CSR deviated from the traditional value-setting of the corporate. The purpose of this study is to highlight some of the issues concerning with the social responsibilities of the business and the false notions of CSR. Discussion

Professor Barry (1999) pointed out that, in general the business operates with respect to a set of code that imparts respect on sanctity of contract, property and the rule of law along with ethical standards like honesty and fair dealing. He mentioned that imposing of additional sets of social responsibilities would be costly as well as burdensome for the business, the shareholders and eventually the society. Still there arises a need for business to treat the customers, employees and suppliers well, so that they become environmentally responsible and keen to the values and interests of communities in which the business operates. According to Henderson (2001), the so called sustainable development and social justice are neither free from controversy nor well defined. The doctrines of CSR are often associated with many issues and distorted events; in particular, it is said to offer a deceptive account of the aftermath of globalization. The adoption of CSR by business, with the support of the government would undermine the market economy and reduce the community well-being. Thus it can turn out to be real potential harm. In order to prevent the weakening of the vital role of CSR (wealth creation), it is necessary to rigorously define and understand the social roles and responsibilities of the business. Some of the wrong notions adopted by the supporters of CSR will be discussed below. It is believed that the CSR assumes a role in creating the world a better place and thus they need to demonstrate corporate citizenship and eventually sustainable development. Their supporters mistakenly presume that this notion of sustainable development is universally agreed and well defined (Henderson, 2001). CSR tends to impair the performance of the corporation, with effect to both short-term and long-term, cost and revenue as it involves the voluntary adoption by business. This effect is mostly neglected by...

References: Barry, N. (1999). Anglo-American capitalism and the ethics of business. New Zealand Business Roundtable, Wellington.
Edward, F. R. (1984). Strategic Management: a stakeholder approach. Boston: Pitman, 46.
Elkington, J. (2004). Enter the triple bottom line. The triple bottom line: Does it all add up, 1–16.
Henderson, D. (2000). Anti-Liberalism 2000: the Rise of New Millennium Collectivism. Institute of Economic Affairs.
Henderson, D. (2001). Misguided virtue: False Notions of Corporate Social Responsibility. IEA Hobart Paper, (142).
Henderson, D., & Robertson, D. (1999). The MAI affair: A story and its lessons. Royal Institute of International Affairs, International Economic Programme.
Lal, D. (2000). The new cultural imperialism: The Greens and economic development. Liberty Institute, Delhi.
McWilliams, A., & Siegel, D. (2000). Corporate social responsibility and financial performance: correlation or misspecification?. Strategic management journal, 21(5), 603–609.
Organisation for Economic Cooperation and Development, Guiding the Transition to Sustainable Development: A Critical Role for the OECD, Report of the High-Level Advisory Group on the Environment, Paris, OECD, 1997.
Schwartz, P., & Gibb, B. (1999). When good companies do bad things: responsibility and risk in an age of globalization. New York: John Wiley.
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