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Currently, the population expresses interest in the influence of companies’ activities on modern life. In turn, companies feel inclined to legitimate their practices to society. The interest is connected with the moral aspect of pursuing profit and implementing regulations of companies’ activities. Such practices reveal the idea of corporate social responsibility (CSR) which presents a complex area as it centers on issues of humanity, sustainability, and environmental responsibility (Crane, Matten, and Spence, 2013, pp. 3-4; Fleming, Roberts, and Garsten, 2013, p. 340; Wright, 2010, p. 1). In this regard, the following social issues have come to prominence: healthcare, education, and investment in communities. Although the idea of CSR appeared in the 1920s it began to develop extensively in the mid 1990s as a must-have of good management (Crane et al., 2013, p. 17; Hond, Bakker, and Neergaard, 2016, pp. 1, 15). For a business to thrive, it needs to uphold four principles, which are concept, importance, impact, and the ethics of corporate social responsibility.
CSR is regarded as a core management concept which requires legitimacy. The media publicizes the concept in newsletters, magazines, on websites, and through social networking sites. Companies do not only have specific departments and present CSR reports but also assist in building networks of CSR activists (Crane et al., 2013, pp. 4-5; Hond et al., 2016, pp. 7, 18). CSR is a concept which involves integration of health, environmental, and social components in business operations and policies. This integration allows voluntary interactions with stakeholders. Also, the concept of CSR is of great interest to various spheres of society. The society has different expectations toward companies’ social responsibility, including ethical, economic, and legal concerns (Hond et al., 2016, p. 1; Sharma & Kiran, 2013, p. 18). These concerns are embedded in six core characteristics of CSR which can vary in accordance with peculiarities of companies’ functioning. The first characteristic is about voluntary activities beyond the law, which are typical of CSR. Also, managing externalities, which describes consequences of economic behavior, is characteristic of CSR; investment in clean technologies serves as a voluntary approach to managing externalities. Furthermore, multiple stakeholder orientation implies that companies do not only have responsibilities toward shareholders but also rely on other stakeholders including communities and consumers. The fourth characteristic reveals social and economic alignment within CSR. Besides, CSR is associated with those business practices and values which underpin social issues. Beyond philanthropy presents the final characteristic as corporate generosity targeting the less fortunate (Crane et al., 2013, pp. 9-12).
Importance of CSR corresponds to the way companies address their contribution to society. Companies must employ a coherent, comprehensive, and professional approach in order to remain legitimate. It is crucial to monitor companies’ effectiveness in terms of acting responsible. For that reason, CSR certifiers, consultancies, and auditors assist in harmonizing the relevant practices on a global level; interest groups aid in coordinating synergies relevant to individual business approaches to CSR (Crane et al., 2013, p. 4; Hond et al., 2016, p. 2). Although acting responsible is primarily a good idea it can produce differentiated results when turned into practice. Implementation of CSR is associated with employing environmental and social strategies similar across different companies. Nonetheless, the options vary from one industry to another or have diverse realizations across countries. The options make companies view social responsibility differently so CSR reporting can be structured in their own ways. No matter which option of implementing CSR companies adhere to they intend to avoid harm by sharing responsibility toward stakeholders and achieving sustainability. As a result, the importance of CSR lies in achieving positive change in the society (Hond et al., 2016, pp. 2, 7; Wright, 2010, p. 1).
Global changes in the market have shifted companies’ attitude to social responsibility. The attitude describes the impact of CSR achieved throughout companies’ voluntary practices. In this regard, social, economic, and environmental impacts constitute companies’ responsibilities for their duties toward society. The duties encourage transparency which enables companies to maintain dialogue with stakeholders and be held accountable to them for their responsible operations (Hond et al., 2016, p. 7; Wright, 2010, pp. 1, 3). The current market situation has brought forth the key factors related to company’s activities. Among them are educational, health, and environmental responsibilities which demonstrate that companies invest CSR money in employees’ education, public healthcare initiatives, and environmental benefits. Efficiency of investment relies on transformational leadership as an innovative approach which maintains enhanced sustainable practices. This approach requires that leaders should obtain specific skills to deal with CSR practices so that this impact will produce a better social image of the company and encourage healthy staff’s development. All the stakeholders reward such beneficial outcomes which allow obtaining further market share and promoting companies’ social responsibility (Sharma & Kiran, 2013, pp. 19, 25).
The usual business seems to be entrenched, whereas ethics of CSR has opened new visions of economic activity. The visions characterize the shared value to society as an aspect of financial rationality within the framework of societal needs. Ethics implies that companies must function as caring entities which promote environmental friendliness and ethicality across their operations. In this respect, managers must be qualified to handle social issues beyond their company’s activities, let alone their skills at boosting profits for the owners of the company. The rise of ethics explicates that companies which pursue ethic business to deal with social issues present the effective running of business (Fleming et al., 2013, pp. 339-341). In addition, managers’ ethics training contributes to their ethical decision making. As ethics of CSR corresponds to moral consequences of CSR decisions so managers must be aware of social, economic, and environmental outcomes of their company’s activities. In this regard, relationship to society as a key part of business ethics establishes companies’ being responsive to societal concerns. Changes in the concept of ethical issue can produce other impacts so over time managers can hold responsibility for other concerns as well. As a result, managers must be knowledgeable about evolving values so that they respond to societal needs in proper time. Acting in accordance with ethical norms requires advanced CSR skills and ability to respond to external pressures from a number of stakeholders (Hond et al., 2016, pp. 3, 6; Wright, 2010, p. 4).
In conclusion, companies do not only aim to pursue profit but also approach societal needs and goals via implementation of key principles of CSR. Firstly, CSR is a core management concept which implies integration of health, environmental, and social components in business operations through voluntary interactions with stakeholders. The main characteristics of CSR embrace voluntary activities beyond the law, management of externalities, commitment to numerous stakeholders, social and economic alliance, commercial values and practices underpinning social issues, and beyond charitable activity. Secondly, companies’ contribution to society reveals importance of CSR, but its implementation can produce differentiated outcomes when put into practice. Thirdly, social, economic, and environmental impacts reflect companies’ responsibilities to society. The key factors concerning company’s activities reflect educational, health, and environmental concerns. Finally, ethics of CSR is associated with managers’ qualifications to deal with societal needs and goals. Ethical decision making also takes into consideration evolvement of societal values which influence companies’ orientation toward CSR. Overall, the idea of CSR enables companies to keep ahead of their commercial rivals.
References
Crane, A., Matten, D., & Spence, L. J. (2013). Corporate social responsibility in a global context. In A. Crane, D. Matten & L. J. Spence (Eds.), Corporate social responsibility: Readings and cases in a global context (pp. 3-26). Abingdon: Routledge. Retrieved from https://ssrn.com/abstract=2322817
Fleming, P., Roberts, J., & Garsten, C. (2013). In search of corporate social responsibility: Introduction to special issue. Organization, 20(3), 337-348. doi: 10.1177/1350508413479581
Hond, F., Bakker, F. G. A., & Neergaard, P. (Eds.). (2016). Managing corporate social responsibility in action: Talking, doing and measuring. London: Routledge.
Sharma, A., & Kiran, R. (2013). Corporate social responsibility: Driving forces and challenges. International Journal of Business Research and Development, 2(1), 18-27. Retrieved from https://www.sciencetarget.com/Journal/index.php/IJBRD/article/view/182/50
Wright, K. (2010). Corporate social responsibility: A review of the literature. The Higher Education Academy Subject Centre for Philosophy & Religious Studies. Retrieved from http://aulre.org/heaprsarchive/sec5_resources_theology/19.pdf
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