Meaning

•Corporate social responsibility is a gesture of showing the

company’s concern & commitment towards society’s sustainability
& development

• Corporate social responsibility is the ethical behaviour of a

company towards society.

• It is known by many names, including corporate responsibility,

corporate accountability, corporate ethics, corporate citizenship,
sustainability, stewardship, and triple-E bottom line (economical,
ethical, and environmental).
WBCSD (World Business Council for
Sustainable Development)

“The continuing commitment by business to behave

ethically and contribute to sustainable economic
development while improving the quality of life of the
workforce and their families as well as of the local
community and society.”
 Basic Constituents of CSR

Contribute towards a
Improvement Towards
Sustainable Make desirable
of social Business
economic Social changes
environment & Society
development

According to Wood, the “basic idea of corporate social responsibility is that business
and society are interwoven rather than distinct entities” and that expectations are
placed on business due to its three roles: as an institution in society, as a particular
corporation or organization in society, and as individual managers who are moral
actors within the corporation.

These roles result in three levels of analysis—institutional, organizational, and

individual— and can be expressed in terms of three principles of corporate social
responsibility: legitimacy, public responsibility, and managerial discretion
 Principle of legitimacy Principle of public Principle of managerial
responsibility decision
•External focus on •Beyond general •Involves individual choice
expectations of society expectations of society, that or managerial discretion
is, at the corporation level
• Society grants the right to • Individual decision
business to operate • Determined by uniqueness makers or managers
for circumstances of the determine
• Adherence of social corporation
norms of society • Relates to latitude of
• Resource dependence action possible by
• Pressures particularly determines management
strong on some
corporations, e.g. large
ones or consumer products • Involves managing • Focuses on range of
relationships with strategic options available
immediate environment to management
 Types of Social Responsibility

 Responsibility towards Society

 Responsibility towards Government

 Responsibility towards Shareholders

 Responsibility towards Employees

 Responsibility towards Customers

Responsibility towards Society

 Carrying on business with moral & ethical standards.

 Prevention of environmental pollution.

Minimizing ecological imbalance.

Contributing towards the development of social health,

education

Making use of appropriate technology.

 Overall development of locality.

Responsibility towards Government

 Obey rules & regulations.

 Regular payment of taxes.

 Cooperating with the Government to promote social values.

 Not to take advantage of loopholes in business laws.

 Cooperating with the Government for economic growth &

development.
Responsibility towards Shareholders

 To ensure a reasonable rate of return over time.

To work for the survival & the growth of the concern.

To build reputation & goodwill of the company.

To remain transparent & accountable.

Responsibility towards Employee

To provide a healthy working environment.

To grant regular & fair wages.

To provide welfare services.

To provide training & promotion facilities.

To provide reasonable working standard & norms.

To provide efficient mechanism to redress worker’s grievances.

Proper recognition of efficiency & hard work.

Responsibility towards consumers
 Supplying socially harmless products.

 Supplying the quality, standards, as promised.

 Adopt fair pricing.

 Provide after sales services.

 Resisting black-marketing & profiteering.

 Maintaining consumer’s grievances cell.

 Fair competition.
Economic responsibilities
 It relate to business’s provision of goods and services of value to society.

 Profits result from this activity and are necessary for any other responsibilities to be carried
out.

 It is assumed that corporations will be as profitable as possible, maintain a strong

competitive position, and maintain a high level of operating efficiency.

These are responsibilities that the corporation “must do” and the key stakeholders are
shareholders, creditors, and consumers.

Ethical responsibilities
It include those activities that are not expected or prohibited by society as economic or legal
responsibilities.

Ethics or values may be reflected in laws or regulations, but ethical responsibilities are seen as
embracing the emerging values and norms that society expects of business even if not
currently required by law. These responsibilities can be thought of as things the corporation
“should do.” Ethical responsibilities also involve the fundamental ethical principles of moral
philosophy, such as justice, human rights, and utilitarianism.
Philanthropic responsibilities

It involve being a good corporate citizen and include active participation in acts or
programs to promote human welfare or goodwill.

Examples are contributions to the arts, charities, and education.

 CSR Principles & Strategies

 Respect for human rights.

Respect for the differences of views.

Diversity & non-discrimination should be the guiding principle.

 Make some social contribution.

Self-realization & creativity.

Fair dealings & collaboration.

Feedback from the community.

 Long term economic & social development.

Best Practices of CSR

 To set a feasible, Viable & measureable goal.

Build a long lasting relationship with the community.

 Retain the community core values.

 The impact of the CSR needs to be assessed.

Reporting the impact.

 Create community awareness.

Need for Corporate Social Responsibility

To reduce the social cost.

 To enhance the performance of employees.

 It a type of investment.

It leads to industrial peace.

It improves the public image.

Can generate more profit.

To provide moral justification.

It satisfies the stakeholders.

Helps to avoid government regulations & control.

Enhance the health by non polluting measures.

Arguments for & against the CSR

Corporate should have some moral & social obligations to

undertake for the welfare of the society.

Proper use of resources, capability & competence.

The expenditure on CSR is a sort of investment.

Company can avoid many legal complications.

It create a better impression.

 Corporate should return a part of wealth.

Arguments against CSR

 Fundamental principles of business gets violated.

 It vey expensive for business houses.

 CSR projects will not be successful.

There are not the special areas of any business.

CSR is to induce them to steal away the shareholders money.

 PHILANTHROPIC MODEL OF CSR
 It holds that, like individuals, business is free to contribute to social causes as a
matter of philanthropy.

•Business has no strict obligation to contribute to social causes; but it can be a

good thing when they do so.

•Business has no ethical obligations to serve wider social goods.

•Business should be encouraged to contribute to society in ways that go beyond

the narrow obligations of law and economics.

 Within the philanthropy model, there are occasions in which charity work is done
because:

•It brings the firm good public relations.

•It provides a helpful tax deduction.
•It builds good-will and/or a good reputation within the community.
 In few cases, firms contribute to charity anonymously, corporate support for the
social causes is not done for potential business benefits, but instead because the
business manager or owner decides that it is simply a good and right thing to do.

 There is overlap between decision makers who engage in the Philanthropic Model
for reputational reasons and those who follow the economic view of business’s
social responsibilities.

 The Philanthropic model in which business support for a social cause is done
simply because it is the right thing to do differs from the reputational version in
terms of the underlying motivation.

From the perspective of the narrow view of CSR, only philanthropy done for
reputational reasons and financial ends is ethically responsible.

• Business managers are the agents of owners, they have no right to use
corporate resources except to earn owners greater returns on their investment.

 From the perspective of the philanthropic model, philanthropy done for financial
reasons is not fully ethical and not truly an act of social responsibility.
 SOCIAL WEB MODEL OF CSR
 It views business as a citizen of the society in which it operates and, like all
members of a society, business must conform to the normal ethical duties and
obligations that we all face.

 According to philosopher Norman Bowie, beyond the economic view’s duty to

obey the law, business has an equally important ethical duty to respect human
rights.
• Respecting human rights: “Moral minimum”
• It is expected of every person, whether they are acting as individuals or
within corporate institutions.
 According to Bowie, business has a social responsibility to respect the rights of its
employees, even when not specified or required by law.
• Right to safe and healthy workplaces
• Right to privacy

 According to Bowie, business has an ethical duty to respect the rights of

consumers, even when not specified in law.
• Safe products
• Truthful advertising
 INTEGRATIVE MODEL OF CSR
 Non-profit organizations: Pursue social ends as the very core of their mission.

Examples: NGOs, foundations, professional organizations, schools, colleges, and

government agencies.

 Even advocates of the narrow economic model of CSR agree that these social goals
should be part of every business model.

Social entrepreneurs demonstrate that profit is not incompatible with doing good,
and therefore that one can do good profitably.

Some argue that the ethical responsibilities associated with sustainability are
relevant to every business concern.

Sustainability offers a model of CSR that suggests that ethical goals should be at
the heart of every corporate mission.