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CSR
• It stands for “corporate social responsibility”. In general CSR or business responsibility can be described as an approach by which a company:
1. Recognizes that its activities have a wider impact on the society in which it operates; and that developments in society in turn impact on its ability to pursue its business successfully
2. Actively manages the economic, social,environmental and human rights impact of its activities across the world.
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3.Seeks to achieve these benefits by working closely with other groups and organizations
4. There are four main parts to CSR
• Economic
• Legal
• Ethical
• Voluntary and philanthropic
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Strategies companies adopted
1. Workplace
2. Environment
3. Responsible marketing
4. Community involvement
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Types of Social responsibility
1. Responsibility towards the customers
2. Social responsibility to prospects
3. Social responsibility to community
4. Responsibility towards human resources
5. Responsibility to society and ecological environment
6. Responsibility towards government
7. Social responsibility to global business environment
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The company and its social
responsibilities• CSR is a form of corporate self regulation
integrated into a business model.
• The term “CSR” came into common use in the late 1960’s and early 1970’s after many multinational corporations formed the term stakeholder, meaning those on whom an organization’s activities have an impact
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Sustainability
• CSR is closely linked with the prinicples of sustainability, which argues that enterprises should make decisions based not only on financial factors such as profits or dividends , but also based on the immediate and long term social and environmental consequences of their activities
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How companies benefit from CSR
activities• CSR benefits
• Reduced costs
• Increased business leads
• Increased reputation
• Improved relationship with stakeholders
• Managing the risks a co faces
• Innovation in processes, products and services
• Social responsibilities for economic growth
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CSR principles and strategies
• The UN global compact’s ten principles in the areas of human rights, labour, the environment and anti corruption enjoy the universal consensus and are derived from:
1. The Universal declaration of human rights2. The international labour organization’s
Declaration on fundamental principles and rights at work
3. The Rio declaration on environment and Development
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4.The united nations convention against corruption
5.The UN global compact asks companies to embrace , support and enact, within their sphere of influence, a set of core values in the areas of human rights, labour standards, the environment and anti corruption.
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A. Human Rights
• Principle 1: Businesses should support and respect the protection of internationally proclaimed human rights
• Promoting the rule of law : societies where human rights are respected are more stable and provide a better environment for business.
• Addressing consumer concerns: Access to global information means that consumers are increasingly aware of where their goods come from and the conditions under which they are made.
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Value chain management:Global sourcing and distribution means that
companies need to be aware of potential human rights issues both upstream and downstream
Increasing worker productivity and retention:
Workers who are treated with dignity and given fair and just remuneration for their work are more likely to be productive and remain loyal to an employer. New recruits increasingly consider the social, environmental and governance record of companies when making their choice of employer.
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• Principle 2:make sure that they are not complicit in human right abuses.
• ComplicityRespecting human rights includes avoiding
complicity, which is another way, beyond their own direct business activities, that businesses risk interfering with the enjoyment of human rights.
Complicity is made up of 2 elements:• An act or omission (failure to act) by a co, or
individual representing a company, that helps “(facilities, assists)” another, in some way, to carry out a human right abuse and
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• 2.the knowledge by the company that its act or omission could provide such help.
Contemporary issues:
• Globalization
• Growth of civil society
• Transparency and accountability
• Crime
• State owned enterprise
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B.Labour
• Principle 3: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining.
• collective bargaining refers to a voluntary process or activity through which employees and workers discuss and negotiate their relations, in particular terms and conditions of work and the regulation of relations between employers,workers and their organizations
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Principle 4:
The elimination of all forms of forced and compulsory labour
Principle 5: the effective abolition of child labour
Principle 6: the elimination of discrimination in respect of employment and occupation
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C.ENVIRONMENT
• Principle 7: businesses should support a precautionary approach to environmental challenges.
• Principle 8: undertake initiatives to promote greater environmental responsibility
• Principle 9: encourage the development and diffusion of environment friendly technologies
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D.Anti corruption
• Principle 10: businesses should work against corruption in all its forms, including extortion and bribery
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Models of CSR
• There are 3 models :
1. Conflict model:
In the traditional conflict model for corporate social responsibility, social values and benefits are seen as in conflict with shareholder profits. Under this model, corporations opting to practice forms of social responsibility are likely to see added costs for doing so.
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2.Added value model
• A second model for conceptualizing corporate social responsibility is to see social and environmental commitments as a means to increase profit. While proponents of this model tend to acknowledge that conflicts persist in business decisions, they also believe that CSR investments are also capable of generating new revenues. This model tends to focus on issues like the value of CSR in attracting socially conscious consumers, finding socially conscious employees and managing the risks of negative press.
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3. Multiple Goals model
• Finally a third model for corporate social responsibility posits a role for social values in corporate decisions that are untethered to economic values. Under this model, corporations have goals beyond shareholder value, including the enhancement of their community without respect to monetary gain.
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Best practices of CSR
• Corporate responsibility is an issue where by most of the companies are dominating with respect to gain the market share in the economy.
• Key components of CR:1. Corporate governance2. True governance should provide all stakeholders
with3. Clarity, openness and democracy in all the
organization’s policies, procedures or strategies and
4. CR report5. Sustainable communities
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Need of CSR
• Social approach is very important to corporate organizations, which demand that they should be responsive to the social problems of society
• To establish a good corporate image,businessorganizations include social responsibility as to corporate objectives
• Legal provisions like pollution and environmental laws also direct a co to take up social problem
• Donations to approved NGOS are exempted from the income tax
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• Indian companies practising CSR activities
1. Icici bank
2. Itc
3. P&g
4. CISCO system inc
5. Infosys technologies ltd
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