Corporate Social Responsibility

Corporate Social Responsibility

Corporate Social Responsibility (CSR), also known as corporate responsibility, corporate citizenship, responsible business and corporate social opportunity is a form of corporate selfregulation integrated into a business model

Ideally, CSR policy would function as a built-in, selfregulating mechanism whereby business would monitor and ensure their adherence to law, ethical standards, and international norms.

CSR

CSR

CSR
Essentially it is a tool box to help businesses move towards

sustainability.

Corporate Social Responsibility

A concept whereby organizations consider the interests of society by taking responsibility for the impact of their activities on customers, suppliers, employees, shareholders, communities and other stakeholders, as well as the environment

Bowen "Father of CSR CSR is an evolution of business ethicswhich comes from human ethics
CSR is critically linked to sustainable business growth and long term success. CSR recognizes that in order to be successful over the long term, a business must actively manage. Add value to all its stakeholder relationships, not just to the bottom line. Maximize the company 's positive impact and minimize the negative impact

Corporate Social Responsibility

Corporate Social Responsibility is a concept whereby companies integrate social and environmental concerns in their business operations and in their interactions with their stakeholders on a voluntary basis European Commission Corporate Social Responsibility is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large- World Business Council for Sustainable Development
Social responsibility (is the) responsibility of an organisation for the impacts of its decisions and activities on society and the environment through transparent and ethical behaviour that is consistent with sustainable development and the welfare of society; takes into account the expectations of stakeholders; is in compliance with applicable law and consistent with international norms of behaviour; and is integrated throughout the organisation.-Source: ISO 26000 Working Group on Social Responsibility

Dimensions of Corporate Social Responsibility

Internal Dimension: This focuses on organizational practices with respect to internal stakeholders that should be aligned to corporate social responsibility standards.

External Dimension: This focuses on an organizations practices towards external stakeholders which should be in accordance with international standards of business practices.

Internal Dimension of CSR

Human Resource Management

Safety and Health

Corporate Agility to Change

Environmenta l Impact Management

External Dimension of CSR

Business Partners

Local Communities

Human Rights

Four Pillars of CSR

Workplace diversity; flexible working; employee engagement; ambassador programmers.

Marketplace Market innovations Ethical trading customer service.

Environment improving waste to landfill and recycling; reducing environmental impacts (green energy).

Community community contributions; charity partnerships; helping tackle social issues.

Responsibility to Share holder

Primary business of business is to stay in business

Safeguard the capital of the shareholders

Provide reasonable dividend

Adequate reserve to provide dividend in lean years

By growth, innovation, diversification ,

the company should consolidate and improve its position

and help to strengthen the share pric

Responsibility to Employees

Payment of fare wages

Working condition

Labour welfare facilities

Training and education to workers

Proper atmosphere for accomplishm ent and promotion

Grievance handling system

Participation in management

Responsibility to Consumer
Ducker The customer is the foundation of business and keep it in existence.

To provide quality goods

Efficient distribution system to ensure stoppage of hoarding and blackmarketing

Supply good at a reasonable price & after sale service

To understand customer needs and to take necessary measure to satisfy these needs

Avoid misleading through advertisement

Information about the product

Responsibility to Community

Prevent Environment pollution

Rehabilitating population displaced

Overall development of locality

Development of backward area

Employment of displaced population

Promotion of ancillaries and small scale Industries

Promotion of education population control

Corporate Social Responsibility

Ethical Responsibilities Social Responsibilities

Legal Responsibilities Economic Responsibilities

Corporate Social Responsibility

Carrolls Four Part Definition Understanding the Four Components
Responsibility Economic Legal Ethical Societal Examples Expectation Required Be profitable. Maximize sales, minimize costs, etc. Required Obey laws and regulations. Expected Do what is right, fair and just. Be a good corporate citizen.

Discretionary Desired/ (Philanthropic) Expected

Business and Society: Ethics and Stakeholder Management, 5E Carroll & Buchholtz Copyright 2003 by South-Western, a division of Thomson Learning. All rights reserved

2-16

Source: Diagram by Mallen Baker

Corporate Social Responsibility

CSR ISSUES Responsible sourcing Eco-efficiency Environmental management Stakeholder engagement Labour standards Employee and community relations. Social equity and human rights BENEFITS OF A COMPANY Improve their access to capital. Enhance their brand image. Increase sales Attract, retain, motivate and develop employees. Sharpen decision-making. Improve risk management. Reduce costs

Corporate Social Responsibility

Tisco Introduction
Five hour working Free medical aid Welfare Dept. Work committees Leave with pay P.F. Accident Compensation Profit sharing 1912 1915 1917 1919 1920 1920 1920

Enforced by Law
1948 1948 1948 1947 1948 1952 1924

Legal measure
Factories Act ESI Act Factories act Ind. Dispute Act Factories Act Emp.PF Act Workmen compensation Act

1934

1965

Payment of bonus Ac t

Gratuity

1937

1972

Gratuity Act

Linking CSR to Business Outcomes

CSR Prog Values
Policies, procedures and processes

CSR Drivers

S/h attitudes and behaviours Customers

Business Outcomes
Revenue Preference

Reputatio n

Employees Govt

Retention
Productivity Cost Emp retention Red wastage Risk Legitimacy Disaster Rev Volatility

Vision org identity, objectives etc

Objectives, stakeholder priorities, corporate competencies

Employee behaviour and motivation s

NGOs Community Suppliers Investors

Social Outcomes
Source: Knox and Maklan (2004)

Corporate Social Responsibility

What? (Task Delineation) How? (Checkpoints on the journey)
1. Conduct a CSR assessment Assemble a CSR team Develop a working definition of CSR Identify legal requirements Review corporate documents, processes and activities, and internal capacity Identify and engage key stakeholders Build support with CEO, senior management and employees Research what others are doing, and assess the value of recognized CSR instruments Prepare a matrix of proposed CSR actions Develop ideas for proceeding and the business case for them Decide on direction, approach, boundaries and focus areas Do a scan of CSR commitments Hold discussions with major stakeholders Create a working group to develop the commitments Prepare a preliminary draft Consult with affected stakeholders Develop an integrated CSR decision-making structure Prepare and implement a CSR business plan Set measurable targets and identify performance measures Design and conduct CSR training Establish mechanisms for addressing problematic behaviour Create internal and external communication plans Make commitments public Measure and assure performance Engage stakeholders Report on performance, internally and externally Evaluate performance Identify opportunities for improvement Engage stakeholders

Plan

2. Develop a CSR strategy

3. Develop CSR commitments

Do

4. Implement CSR commitments

Check Improve

5. Assure and report on progress

6. Evaluate and improve

Source: Paul Hohnen, Corporate Social Responsibility, An Implementation Guide

Other sources for CSR reporting:

Sustainability Guidelines developed by the Global Reporting Initiative
(www.globalreporting.org) SA800 certification developed by the international human rights organisation Social Accountability International. (www.sa-intl.org)

Other sources for CSR reporting:

The Green Globe programme for benchmarking, certification and performance improvement, based on Agenda 21 proposals from the 1992 Rio Earth Summit

(www.greenglobe.org)
ISO 14000 international environmental management standards (www.14000.org)

Other sources for CSR reporting:

The United Nations Global Compact (UNGC) framework and mechanism designed to encourage businesses to adopt CSR policies (www.unglobalcompact.org) The FTSE 4 Good Index measures the performance of companies who meet globally recognised CSR standards. (www.ftse.com/Indices/FTSE4 Good_Index_Series)

Alternative sources of information:

www.corpwatch.org

www.naomiklein.org

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