Corporate Social Responsibility

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Cover Sheet

Course Code: FEAD22 Course Name: Business Ethics
Title of work: Craft of Seminar.

Name Of The Topic: Corporate Social Responsibility

The Last Date: 02 July 2014
Date prepared: 30 June 2014
Name of the Student:
Name Class CMS
Wasim Jamali
Aamir Ali
BsBA 6
th
B 17686
17388


Name of the Supervisor: Irum Gull







Corporate Social Responsibility
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ABSTRACT
This paper outlines the conceptual and contextual and disciplinary scope of the rapidly evolving
topic Corporate Social Responsibility. Corporate social responsibility is overseen in growth
industry if u log on to Google and search for CSR youll come up with 970000 web-pages to
inspect. CSR is turning into big businesses all over the world. This paper throws a light that how
CSR is contributing for the development and progress of the society.
Here I have given a clear view about the corporate social responsibility and its influence on the
society with the case of Toyota Corporation. I here presented the CSR initiatives and practices by
Toyota Corporation. Here I used secondary data from the company and other web sources. I use
both qualitative as well as quantitative data and analyse them to have better understanding about
the impact of corporate social responsibility on both the society as well as company.
Key Words Corporate Social Responsibility, Societal Concern, Competitive Advantage, Socially
responsible investment, environmentally responsible, ethical practices and service, Toyota
Corporation.

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EXECUTIVE SUMMARY
Corporate social responsibility is todays trending topic in corporate world. Since business and
society have been interdependent. This relationship between business and society is appreciated
like: corporate should work like a honeybee, which take the nectar of a flower without the flower
being losing its shape and fragrance and provides honey for the wellbeing of the society. The
business history is replete with evidences to believe that business grows and develops only where
society thrives. On the contrary, business dies when the society condemns and rejects it. No
business can survive without societal approval and sanction.
The interdependent nature of relationship between the business and the society is best illustrated
by the father of modern management Peter Ducker (1954) with the example of ship and sea. Like
the relationship between a ship and the sea which engirds it and carries it, which threatens it with
storm and shipwreck, which has to be crossed but which is yet alien and distant.
I have considered the case of the Giant automotive manufacturer Toyota Corporation which is
operating over all the global markets. I presented how the company is providing its services to the
society in terms of corporate social responsibility. Toyota Company is incorporating the
environmental responsibility from the development of sustainable vehicles and making
manufacturing plants sustainable to vehicle recycling. Eco-driving educational programs and
reforestation, Toyota is actively engaged in wide variety of programs to improve the environment.
This environmental responsibility is a key element of Toyotas corporate social responsibility
initiatives.
These activities lead to a competitive advantage to the company and create an impression in the
mind of public. Due to the company support in creating the better environment, society is also
grateful to the company. As a company, Toyota is fully committed to the principles of
sustainability. It promises the society, shareholder, and stakeholders for sustained economic
performance. At the company, social initiatives dont just cover the community, but also
employees, this re-interpretation has happened for an important reason: society represents a mix of
employees and non employees. By including employees in social initiatives, the company has
demonstrated that no initiative can succeed unless if the initiators of the improvement do not
figure among the beneficiaries themselves. So finally I can conclude that both company and
society are interdependent each other. CSR has become a key concept and activity in the
organization, which promotes a sustainability and growth towards the society.
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Abstract
Executive Summary
Table of contents

1. Introduction ........................................................................................................................... 5
2. Corporate Social Responsibility (Conceptual & Theoritical Framework) ............................ 6
2.1 CSR Pyramid ................................................................................................................... 8
2.2 Importance of CSR .......................................................................................................... 9
2.3 CSR & Stake holders ..................................................................................................... 10
2.4 Benifits of CSR ............................................................................................................ 11
2.5 CSR Dimensions ........................................................................................................... 11
3. Toyota Corporation CSR Principles & Policies ............................................................. 12
3.1 Toyota CSR Committee ................................................................................................. 14
3.4 Toyota CSR Policy Positioning ..................................................................................... 15
4. Analysis & Conclusion ....................................................................................................... 16
List of references ..................................................................................................................... 17












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1. Introduction
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 local community and society at a large.
Carrolls model of corporate social responsibility states that organisation should need to adopt
discretionary responsibilities, ethical responsibilities, legal responsibilities and economic
responsibility. The corporate responsibility concept totally deals with environmental issues, which
relate to environment, and economic issues which relates to market place and social issues which
relates to society and government. The companies argument for social responsibility is influenced
by different factors those are:
Changed public expectations of business
Public image
Avoidance of government regulation
Business has the resources
Prevention is better than cure
According to Carroll and Buchholtz corporate social responsibility is the economic, legal, ethical
and discretionary expectations that society has of organisations at a given point in time. (Carroll
and Buchholtz 2003, P. 36). Corporate responsibility reflects about how a company manages its
business process to create an overall positive impact on society. Business firms are now a days
thriving in global competition. To survive in this competitive arena not only the profitability but
also the need of service orientation towards employees, suppliers, customers, the local community,
state , and federal governments, environmental groups, and other special interest groups. Although
CSR activities implementation need more time ,effort and resources however the business
organisation have realised that it(CSR) is one of the most significant way for an organisation to
distinguish itself from its competitors.
This report mainly focuses on CSR in perspective of TOYOTA Corporation which is having its
operations across the globe. The companys mission statement is to sustain profitable growth by
providing the best customer experience and dealer support.

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Business can help by defining itself by explaining what it is and what it isnt. From this stand
point:
The boundaries to corporate social responsibility are conceptual. A companys primary
responsibility is to its share holders, to its owners.
The boundaries are ideological. A company is not a government. It is not elected. It has no
popular mandate. It mustnt confuse its role with the role of others.
The boundaries are practical. A company has limited resources, limited expertise and
limited reach. A company is not a panacea, a cure at all.
The boundaries are influenced by self-interest. Business thrives if the society in which it
operates thrives. To neglect this is to put at risk the interests of shareholders of the
company.
2. Corporate Social Responsibility: Conceptual and Theoretical framework
More recently CSR has become focussed on corporate behaviour and policies and values. CSR
activities are influenced and based on different elements.

Corporate social responsibility of any company is based on the five elements. From the
above figure a company should be good in innovation, means introducing new products
and services from time to time in the market to service the customers which leads to
competitive advantage in market.
5 Basis of
CSR
Opening and
sensitiveness
to
government
Value
Creation
Long-term
consideration
Innovation
Community
sense
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Value creation is one of the primary targets for any company, because to create trust
worthiness in the market and in the minds of the shareholders, customers and investors
every company needs to generate the value from its operations. Today companies are not
working for profit motive. To survive in the competitive market every company need to
focus in service rather than profit. That is profit through service motive.
Community sense is, a company should be liable to the community and respects the
community needs and requirements and provides some good in terms of economic, societal
and educational issues.
Every company has to run on corporate governance, corporate governance is the frame
work of all the set of principles and procedures to protect the company from frauds and
other issues. For this the company need to abide the rules, laws and regulations framed by
the government.
Business is a process, its not a contract, and if it wants to survive in the market it should
consider the needs and wants of the various interest groups.
Corporate Social responsibility: Defined
Social responsibility refers to the obligations of businessmen to pursue those policies, to make
those decisions or to follow those lines of action which are desirable in terms of the objectives and
values of our society (Howard R. Bowen 1953).
In the words of Kenneth R Andrews, by social responsibility we mean the intelligent and objective
concern for the welfare of society that restrains individual and corporate behaviour from
ultimately destructive activities, no matter how immediately profitable, and leads in the direction
of positive contributions to human betterment, variously as the latter may defined (Kenneth R
Andrews 1989).
Corporate responsibility plays an important role to enhance the brand image and reputation of
business firm. It (CSR) helps to improve sales and customer loyalty. It also enables to attract and
retain employees. The corporate social responsibility is deliberate to provide each business with a
far greater ability to create sustainable development. Corporate social responsibility is linked with
sustainability. The attraction towards corporate social responsibility for many businesses is that it
can help to increase sustainability without creating any negative effects. In the present arena CSR
has occupied very important place in the plans and strategies of the business organizations.

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2.1 CSR PYRAMID

Economic responsibilities
Business organisations are formed as economic entitys to provide quality goods and better
services to societal members. The profit motive was established as primary incentive for
entrepreneurship. Business organisations were treated as the basic economic unit in our society.
Thus its major role was to produce goods and services that consumers needed and wanted and to
make an acceptable profit in the process. At some point the motive of getting profits are
transformed into a notion of maximum profits, and it has been an enduring value ever since. All
other business responsibilities are predicated upon the economic responsibility of the firm,
because without it the others become controversial considerations.
Legal responsibilities
Business should not be only for profit motive while serving the society. At the same time business
is expected to comply and should abide with the laws and regulations promulgated by federal,
state and local governments as the ground rules under which business must operate. As partial
fulfilment of the social contract between business and society, firms are expected to pursue their
economic missions with the framework of law. Legal responsibities made businesses are having
Philanthropic
Responsibility
Ethical
Responsibility
Legal
Responsibility
Economic
Responsibility
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codified ethics and they co-exist with economic responsibilities as fundamental precepts of the
free enterprise system.
Ethical responsibilities
Al though the economic and legal responsibilities have ethical base about fair practice and justice
,ethical responsibilities embrace those activities and practices that are prohibited by members of
the society even though they are not codified in to law. Ethical responsibilities frames those
standards ,norms, or expectations that reflect a concern for what consumers, employees,
shareholders, and the community regard as fair just or in keeping with the respect or protection of
stakeholders moral rights. In other sense, ethical responsibilities rare viewed as newly emerging
values and norms society expects business to meet, even though such values and norms may
reflect a higher standard of performance than that currently required by law.
Philanthropic responsibilities
Philanthropy encompasses those corporate actions that are in response to the society expectation
that businesses to be good corporate citizens. That is actively engaged in various activities or
programs to promote human welfare or goodwill. Examples of philanthropy include business
contribution of financial resources or executive time, such as contribution to the arts, education, or
the community. Therefore philanthropy is more discretionary on the businesses part even though
there is always the societal expectation that businesses provide it.
The CSR of business entails the fulfilment of the firms economic, lelgal ethical and philanthropic
responsibilities. The csr firm should strive to make a profitable value, obey the law, and be ethical
and good corporate citizen.
2.2 Importance of CSR
CSR is one of the fundamental tools in vital duty for any business organisation irrespective of its
size. The business which fulfils its corporate social responsibilities successfully will survive in
long run. To thrive in the present competitive world every organisation should be grateful to the
public. Though organisation and society are interlinked and inter depended, the fair practice of
CSR will impact on the good will of organisation.
CSR minimizes negative impact on stakeholders and it produces wealth and value for all
stakeholders.
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2.3 CSR & Stake Holders

Companies have their own ability to opt their stakeholders as children have to choose their
parents, so the firm is always prioritizing its stakeholders. The location, scale and nature of
operations will determine the stake holders existence. Stakeholders will expect to be recognised
when the firms effect on them, for better or worse, is direct or immediate. A useful technique at
this stage is stakeholder mapping this is a way of representing different stakeholder relationship
the firm has and their relative proximity or strength. Some businesses use grids and others use
circles. It is important to include all the relationships in which the firm affects people or they
affect the firm. The firm may be contemplating stakeholder engagement for better understanding
its impacts and to help articulate its values, mission, strategy, commitment and implementation to
facilitate a regulatory approvals process, to participate in measurement and reporting to improve
relationships.





INVOLVEMENT OF
STAKEHOLDERS
MISSION
STRATEGIC PLAN,
BUDGET AND
SUSTAINABLE REPORT
CODE OF
ETHICS
OPERATIONAL
PROJECTS
BALANCE
SCORE CARD
VALUES
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2.4 Benefits of CSR
It aids the attraction and retention of staff.
It attracts green and ethical investment.
It attracts ethically conscious customers.
It can lead to a reduction in costs through recycling.
It differentiates the form from its competitor and can be a source of competitive advantage.
It can lead to increased profitability in the long run.
2.5 CSR Dimensions
Owners and share holder s is the key people for success of any business organization, they are the
one who invest for an organization so it is essential to work together for the benefit of an
organization. Employees are the one who works for an organization so, maintaining a sound
environment in an organization is very much essential therefore they can work hard for the benefit
of their clients. Consumers are the key people for the success of any business organization;
organization should take some necessary feedback from them. It would help them in the future for
better performance. Organization cannot go beyond the rule of the government so they should
cooperate with government to follow the rules and perform their activities.
Corporate social responsibility plays an important role to enhance the brand image and reputation
of the business firm. It (CSR) helps to improve sales and customer loyalty. It also enables to
attract and retain employees. The corporate social responsibility is deliberate to provide each
business with a far greater ability to create sustainable development. Corporate social
responsibility is linked with sustainability. The attraction towards corporate social responsibility
for many businesses is that it can help to increase sustainability without creating any negative
effects. In the present era corporate social responsibility has occupied very important place in the
plans and strategies of the business organizations.





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3. Corporate social responsibility Principles & Policies: Toyota Corporation
Toyota Company was founded in the year 1867 to create automobiles, head quartered in Aichi,
Japan. The company is famous for its quality and customer satisfaction.
CSR policy towards sustainable development
Toyota Motor Corporation take initiative to contribute to harmonious and sustainable
development of society and the earth through all business activities that we carry out in
each country and region based on our guiding principles.
Toyota comply with local, national and international laws and regulations as well as the
spirit there of and the company conducts its business operations with honesty and integrity.
In order to contribute to sustainable development, the company believe that management
interacting with its stakeholders as described below is of considerable importance, and the
company will endeavour to build and maintain sound relationships with its stakeholders
through open and fair communication. Toyota expects its business partners to support this
initiative and act in accordance with it.
CSR policy towards customers
Based on the company philosophy of customer first, it develop and provide innovative,
safe and outstanding high quality product and services that meet a wide variety of
customers demands to enrich the lives of people around the world.
Company endeavours to protect the personal information of customers and everyone else
where the company is engaged in business with, in accordance with the letter and spirit of
each countrys privacy laws.
CSR policy towards employees
Company respects its employees and believe that the success of its business is led by each
individual creativity and good teamwork. The company stimulates the personal growth of
its employees.
Company supports equal employment opportunities, diversity and inclusion for all
employees and do not discriminate against them.
Company strive to provide fair working conditions and to maintain a safe and healthy
working environment for all the employees.
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Company respect and honour the human rights of people involved in business and in
particular, do not use or tolerate any form of forced or child labour.
Through communication and dialogue with employees, the company build and share the
value mutual trust and mutual responsibility and work together for the success of
employees and the company. Company allows employees right to freely associate, or not
to associate, complain with the laws of the countries in which it operate.
Management of each company takes leadership in fostering a corporate culture, and
implementing policies, that promote ethical behaviour
CSR policy towards business partners
Company respect its business partners such as suppliers and dealers and work with them
through long term relationships to realise mutual growth based on mutual trust.
Whenever company seek a new business partner, it is open to any and all candidates,
regardless of nationality or size, and evaluates them based on their overall strength.
Company practice and maintains fair and free competition in accordance with the letter and
spirit of each countries competition laws.
CSR policy towards shareholders
Company strive to enhance corporate value while achieving a stable and long term growth
for the benefit of our shareholders.
Company provide its shareholders and investors with timely and fair disclosure of
information on operating results and financial conditions.
CSR policy towards global society and local communities
Environment- Company aim for growth that is in harmony with the environment by
seeking to minimize the environmental impact of business operations, such as by working
to reduce the effect of its vehicles and operations on climate change and bio diversity.
Toyota strives to develop, establish and promote technologies enabling the environment
and economy to co exists harmoniously, and to build close and cooperative relationships
with a wide spectrum of individuals and organisations involved in environmental
preservation.
Community- company implements its philosophy of respect for people by honouring the
culture, customs, history and laws of each country and it constantly search for safer,
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cleaner and superior technology that satisfy the evolving needs of society for sustainable
mobility and company do not tolerate bribery of or by any business partner, government
agency or public authority and maintain honest and fair relationships with government
agencies and public authorities.
Social contribution- Toyota actively promote and engage, both individually and with
partners, in social contribution activities that help strengthen communities and contribute
to the enrichment of society.
3.1 CSR Committee in Toyota
Company has established 4 committees as sub committees under the main CSR committee, which
deliberates and handle important issues. Those committees are
Corporate ethics committee: internal governance, observation of regulation, constructing sound
corporate culture
Product environment committee: progress with product development that reliably addresses
environmental regulations
Production environment committee: progress for production technology development for reducing
CO2 and fulfilling the enforcement of production environment policy
Social contribution committee: fulfil social responsibility to the communities or our employees
and progress with social contribution activities.
The committee is deliberating and issuing reports on the issues listed below:
Planning global CSR policies and activities
Corporate Ethics, legal complaints.
Significant issues concerning, risk management
Significant issues concerning, social contribution issues and new environmental issues.



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3.2 TOYOTA- CSR Policy positioning















CSR department to promote Toyota CSR initiatives
In June 2010, the risk management committee was formed under the CSR committee in response
to quality issues, and will be chaired by a CSR committee member responsible for risk
management at vice president level. Originally organised under the CSR and environmental affairs
division, the CSR office was transferred to the corporate planning division to achieve deeper
Companywide expansion of CSR initiatives.


BASIC MAP
BASIC PRINCIPLES (CSR DIRECTION)
TOYOTA AUTO BODY 2020 VISION
MID TERM MANAGEMENT PLAN
COMPANY POLICY, FISCAL YEAR
POLICY, DEPARTMENTAL POLICY
DAILY BUSINESS
T
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P
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4. Analysis and conclusion
Toyota clearly understands that the future of any organisation is based on three sub systems of
complex global system nature, socio political and global economy for their development and
sustainability. Its global warming prevention initiative which reduces co2 emission and prevents
global warming is highly prioritized, by restricting energy consumption in all areas of business
activities, in all stages of vehicle development and in design, production, logistics, and more. The
concept of eco driving is an environmentally considered way of driving that reduces the amount
of co2 emissions. The company is taking care of all parties like shareholders by providing them
value, for employees by providing them healthy and safe work environment and economic
benefits, for society by providing quality and innovative products for government by abiding the
rules and regulations. Because of its CSR activities Toyota has been selected as a constituent of
the Dow Jones Sustainability Indexes (DJSI) Asia pacific. And Toyota placed in global 100 most
sustainable corporations in the world.

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Carroll Archie B. (1996). The Pyramid of Corporate Social Responsibility: Toward the Moral
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H K Sethi & R L Sood (2006). Corporate Social Responsibility in Modern Times. GROWTH, 34
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Howard R. Bowen (1953). Social Responsibilities of the Businessman; New York: Happer &
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Kenneth De Roeck, Valrie Swaen (2010). The role of CSR on employees post-merger
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Kenneth R Andrews (1989). Ethics in Practice: Managing the Moral Corporation. Boston MA:
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Maigan I & Ferrell OC (2004), Corporate Social Responsibility and Marketing: An Integrative
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Jenifer A. Zerk (2006). Multinationals and Corporate Social Responsibility: Limitation and
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Winsdor D (2001). The future of Corporate responsibility. International Journal of
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