Abstract
Given the significance of the corporate social responsibility in the contemporary society, the author in the paper focuses on the role of the corporate social responsibility (CSR) in the obtaining the higher volume of profit and attract new investors. In addition, the author dwells on the elements of CRS and its influence over the attitude of the consumers to the companies if they are focused at the deliberation of the CSR policy. The paper contains the brief literature review that presents the main findings of the researches engaged in the examination of the framework of the CSR. This review provides the analysis of the role of the CSR in the strengthening the corporate ethical standards, branding, advertisement campaign. At the same time, the interaction between the realization of the CSR policy and the economical performance of the business unit is determined. Furthermore, the case study analysis is provided with regard to such companies as Microsoft and BWM as the main business units having the successful implementation of CSR within the last decade. Due to the fact that the CSR is related to the challenges posed to the contemporary society, the paper addresses the issue as to how to take all benefits from this valuable instrument. In the final part of the paper the author considers what recommendations may be taken by any business unit that has the desire to reconsider the main points of the current personal CSR strategy.
Introduction
Nowadays the corporate social responsibility is regarded as the main sphere of the internal and external strategy pursued by several companies. For the last ten years, some companies have taken the decision to strengthen the own social corporate responsibility and increase the budget expenses in order to maintain this sphere of the activity on the appropriate level. Corporate social responsibility is understood as the innovative social initiative that allows the companies to compete in the different industries for the resources and attentions of the consumers that appreciate the promotion of the social values of highly importance fort he welfare of the society. The support of the CSR within other activities of the companies implies that business units may force the appearance of several social changes. Consequently, the firms rely on the attitude of the stakeholders with regard to the development of the reasonable CSR strategy as they may add value to the performance of the companies in the market.
There is huge amount of the scholar papers devoted to the examination of the role of the CSR in the business environment, while some of them are devoted to the identification of the pros and cons. In general, the promotion of the CSR allows to improve the status in the market, turn the brand into the popular one, while the reputation of the company becomes safe and clear to the customers. However, the promotion of the CSR requires from the company to increase the budget spending in the internal and external levels.
Literature Review
In the paper about the role of the corporate social responsibility over the decision making process of the stakeholders, Xin Deng emphasizes that this component of the firm increases the attractiveness of the business unit for the shareholders and perspective investors. Meanwhile, the author of the poet identifies the grounds for the increase of the investment spending over the CSR promotion. There are two common approaches accepted by the stakeholders with regard to the development of the CSR. In first case, stakeholders rely on the value maximization view, in accordance to which CSR is focused at the interests of the involves participants. The investors are reaffirmed that the promotion of the CSR may double the existing intangible assets that in fact will lead to the high long-temr returns of the stocks upon the finalization of the transaction. The author divides the CSR into the adjusted and raws due to the difference in the volume of the community activities involved (Deng, Kang and Low, 2013).
Next paper completed by Blomback confirms the fact that inclusion of the corporate heritage in the promotion of the CSR policy influences the reputation of the company and position of the brand within the society in the positive manner. The author has completed the survey alayzing the stipulation of the corporate ethical identity pursued by the companies in several industries within the framework of the CSR strategy. In this regard, the researcher came to the conslusion that combination of the CSR policy in addition to the development of the corporate heritage allows to achieve the high moral standards by the business units (Blomback and Scandelius, 2013).
Researcher Shuili Du highlights the role of the CSR in the formation the full picture about the company. He states that realization of tang activity of the company in terms of CSR development results in the elaboration of the comfortable and environment attracting the attention for he consumers, stakeholders, investors. At the same time, Shuili Du considers underlines that lack of the attention towards the development of the CSR results in the elimination of the possible benefits that may be created due to the CSR promotion so that the company may lose certain share of the profit (Du, Bhattacharya and Sen, 2010).
Andrea Perez in his work contemplates the interaction of the corporate reputation with the proper implementation of the CSR. This form of the reporting before the society influences the development of the business environment in the positive manner. By virtue of the CSR the individuals get the idea that the companies hear them properly and have the intent to address certain social problems. Moreover, Perez emphasizes on the notion of CSR adopted by the European Comission. According to the approach of the state body, the CSR is defined as the voluntary actions taken by the business units in order to promote the realization of the social and any environmental issues of the business units upon the close cooperation with the relevant state authorities and other stakeholders (Perez, 2015).
Accordingly, Emel Esen through the paper devoted to the examination of the influence of the CSR over the formation of the corporate reputation stands to the position that consequences of the addressing social changes create only positive effects over the company. With the activity of the staff employed by the business units, the well developed and structured CSR strategy may be realized with the help of the joint efforts of the employees, managers, stakeholders operating in this industry. Moreover, the author came to the findings that in case the business unit is vested in with the aim to promote the CSR activities and present the evidence to the audience by virtue of the annual reports, this company will have stable and strong social and corporate standardiz. Additionally, Esen found out that the American and European companies have dramatically different approaches in addressing the CSR elements (Esen, 2015).
Through the paper completed by Khojastehpour, the reader may get the idea that CSR affects significantly the environmental changes. The main aim and task of the company is to find strike balance between the intend to resolve the CSR issues related to the preservation of the environment, maintenance of the corporate reputation and the deepening of the profit of the company. This balance may serve the role of the competitive advantage fit the company regardless of the essence of the industry in which it operates (Khojastehpour and Johns, 2014). Meanwhile, Lewis in this paper about the link between the reputation and CSR is loyal to the idea that nowadays investors are highly concerned with the level of the CSR in the company. This factor influences the decision of the investors to purchase the assets of the company in case it does not pay attention to the necessity to protect the basic human rights (Lewis, 2003). Moreover, Starbutts thinks over the fact that the level of the CSR and its influence over the performance does no depend on the size of the enterprise. He states that any company may pursue the main pillars of the CSR in order to manage the reputation within the market in the reasonable manner (Sarbutts, 2003). Although, Constantinos in his works about the perceptions of the customers regarding the promotion of the CSR found that up to 40 % of the consumers do no pay attention to the pursuit of the elements covered by the CSR. In this regard, the attitude of the customers does not change irrespective of the fact whether the company tries to save the environment or not (Constantinos, 2013). Finally, Mobin Fatma in the study about the formation of the company reputation and brand equity came to the conclusion about the existence of the connection and dependence between the perceptions of the customers regarding the activity of the business unit. The main concern identified in the behavior of the consumer is the provision of the qualified and affordable goods and services to the customers regardless of the CSR development (Fatma, Rahman and Khan, 2015).
Analysis of the Case
For the purposes of this paper, the author has decided to take Microsoft and BMW in order to assess their CSR strategies due to the efficient performance in the relevant markets in this dimension. To start with, the Microsoft has a significant level of the expenses ascertained from the budget over the CSR. Annual budget for promotion of CSR amounts up to $1 billion, while the company is ranked the most successful business unit supporting the development of the CSR. The main goal of the strategy is to tackle the needs of the population worldwide and satisfy these needs with all available measures. The main spheres covering by CSR of the Microsoft are the following:
Persistent education training
Protection of the human rights and employment guarantees
Guarantee of the reliable and healthy environment
Improvement of the environment
Promotion of the desire of the youth population
Therefore, the Microsoft is welcomed by the global communities for the opportunities provided by the company to the major categories of the population. Meanwhile, this firm pursues the main objectives that have the pivotal importance for the further development of the society so that these initiatives should be supported. In contrast, the other giant in this sphere – Apple Inc. has a terrible CSR strategy, according to which the main human rights are not complied with. Moreover, in 2008 the company was found guilty in the usage of the child labor in the factories located in China what damaged the reputation of the company significantly at that time. However, nowadays the company is trying to fix the situation and still removes the consequences of the negative CSR.
Consequently, the BMW corporation is the another successful CSR promoted in the automobile industry. In this regard, the BMW reports about the reduction of the energy and water consumption up to 60% for the production of every vehicle within the premises of the company. From this point of view, the company is treated as the most sustainable business unit in the automobile industry that pursues the aim to extend the clean energy in the world. Moreover, the mission of the BMW Corporation is focused on the social responsibility as to the fact that the managers of the company consider the firm is the part of the society and should recognize the responsibilities taken towards the other individuals. Finally, in accordance with the BMW CSR policy, it focuses on the development of the innovations between the cultures, support of the social inclusion, treat in the reasonable manner the usage of the resources and construct the safety at the roads. Despite the fact that Microsoft and BMW serve the role of the successful example promoting the CSR in several regions of the world, the companies have different plans and measures leading them to the success (Bmwusfactory.com, 2016).
Therefore the successful realization of the CSR influences the reputation of the companies in the positive manner due to the fact that it supports their reputation within the world as the caring firm.
Conclusion
Corporate social responsibility is regarded as the one of the main activities of the companies which have the desire to maintain the reputation and status in the world. Due to the vast definitions explaining the main notions of the CSR, in general it should be understood as the management strategy aimed to maintain the welfare of the society with the resolution of the environmental problems, etc. Nowadays, the major global companies spend significant volumes of money over the development of the CSR in order to attract the customers and draw attention to the clean production of the goods without huge consumption of energy and other resources. Given the fact that the availability of the resources is highly important for the living of the individual, their preservation is reflected in the most efficient CSR as Microsoft, BMW have. Moreover, the maintenance of the CSR in the global dimension leads to the creation of the several benefits classified into the social, financial. Furthermore, by virtue of the efficient CSR the company is able to double the profit obtained and improve its status in the operating market. However, the benefits of the CSR may depend in accordance with the pillars of the strategy defined by any company due to the objectives set. Finally, the role of the CSR is important for the development of the business units in general. Despite the fact that this initiative was launched on the voluntary basis, nowadays the companies can not disregard its importance for the development of the society.
Recommendations
Talking about the recommendations, there is no unique approach that may be taken by the company in order to develop the strong CSR policy. Any business unit contermplaring the reformation of the current CSR strategy should pay attention to the best-practices in this dimension as Microsoft, BMW, while the flaws pertaining to the maintenance of the CSR on the example of Apple should be avoided. In addition, there is a necessity to conduct the comparative analysis of the CSR strategies adopted by the provident international companies. The research and review provided in this paper shows that the following elements should be covered by the efficient CSR: compliance of the human right, environmental sustainability, launch of the training programs for the least developed groups of the population, etc. Finally, the main recommendation is that CSR should be considered upon case-by-case basis due to the difference in the industries and profiles of the companies.
Bibliography
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