According to the results of a global survey in 2002 by Ernst & Young, 94 per cent of companies believe the development

of a Corporate Social Responsibility (CSR) strategy can deliver real business benefits, however only 11 per cent have made significant progress in implementing the strategy in their organisation. Senior executives from 147 companies in a range of industry sectors across Europe, North America and Australasia were interviewed for the survey.

Research found that company CSR programs influence 70 per cent of all consumer purchasing decisions, with many investors and employees also being swayed in their choice of companies.

 Critics concerned with corporate hypocrisy and insincerity generally suggest that better governmental and international regulation and enforcement, rather than voluntary measures, are necessary to ensure that companies behave in a socially responsible manner. Patricia Werhane, argue that CSR should be considered more as a corporate moral responsibility, and limit the reach of CSR by focusing more on direct impacts of the organization

 Friedman (1970):- when such actions are carried out for the reasons of self-interest, then they are not CSR at all, but merely profit maximization; under the cloak of social responsibility It has to be seen whether profit was the main motive or was it altruism Direct relation between profit maximization and social work in business (Griffin and Mahon)

Lewis Carrolls Model of CSR

Desired By Society

Philant hropic Resp

Ethical Responsibilities

Expected By Society

Legal Responsibilities Economic Responsibilities

Required By Society

Economic Responsibilities

Required By Society

 Economic:- shareholders demand economic return. Also considered CSR? Most important and basic Legal:- play the rules by the game. Laws are codification of societys moral views. Some companies have been convicted of anticompetitive behaviour to maintain a marketshare

 Ethical:- oblige corporations to do what is right. Example: of Shell throwing away the petrol in the Sea overturned eventhough all the permissions were received Philanthropic:- Greek word love for the fellow human. Charitable donations, recreational facilities for employees Extra and more satisfied customers. Example: Greenpeaces campaign against ExxonMobil:Company is worlds number 1 climate criminal.

Corporate Social Responsibility

CSR means: The Capacity of a corporation to respond to social pressures.

CSR encompasses economic, legal, ethical and philanthrophic expections placed on organisations by society at a given point in time

Why are corporations tempted to look at CSR in a narrow way?

By now, widely accepted that businesses do have responsibility beyond simply making profits Enlightened Self-Interest:- corporation takes on social responsibility in so far as doing so promotes its own self interest

 Social investment - contributing to physical infrastructure and social capital is increasingly seen as a necessary part of doing business. Transparency and trust - business has low ratings of trust in public perception. There is increasing expectation that companies will be more open, more accountable and be prepared to report publicly on their performance in social and environmental arenas Increased public expectations of business globally companies are expected to do more than merely provide jobs and contribute to the economy through taxes and employment.

 Employees might be attracted to work for, and even be more committed to, when organisations are social responsible Voluntary actions by corporations ensures greater corporate independence from government Long-term investment, which establishes stable context to do business

Debate
Question:- Whether CSR brings financial success or financial success liberates company to indulge in the luxury to bring CSR?

Moral Arguments for CSR

Corporations cause social problems such as pollution they have a responsibility to solve it and prevent, if possible As powerful social actors, corporations should use their power responsibly All corporate activities have social impact: eg. Workers rights, quality standards etc they cannot escape responsibility Taking care of the interests and goals of different stakeholders

According to Archie Carroll (1979), there are four philosophies of social responsiveness:
Reaction:- the classic denial mode. Arguing that the corporation is not to blame. Evades reponsibility Defence:- Corporation admits responsibility but fights it doing the very least that is required Accommodation:- accepts responsibility and does what is demanded by several groups Proaction:- goes beyond industry norms and does more than anticipated

Concerns
McDonalds:- distract the public from ethical questions posed by their core operations. Bill McKibben:- corporations which exist solely to maximize profits are unable to advance the interests of society as a whole Sometimes companies claim to promote CSR and be committed to sustainable development but simultaneously engage in harmful business practices.