Introduction
In the contemporary world, the term Corporate Social Responsibility (CSR) has become one of the most important concepts that help to define the business. Since the time of Aristotle, businesses have been pushed to contribute to the community by addressing the interest of the community through the CSR. Therefore, the CSR is the concept implying that a firm should give back to the community where they operate. For instance, the Dow Chemical Company is committed to serving the society through the CSR. The company believes that the community is an integral part of their operation, and hence thrive to achieve long-term relationships with their stakeholders to succeed their operations. At Houston Operation, the company focuses on the educational and community effort because they believe "being a good neighbor means being an active partner in the community" (The Dow Chemical Company, 2016). According to the Three-Domain model of CSR, the Dow's CSR accomplished the legal, economic, and ethical aspects of the model (Schwartz & Carroll, 2008). For instance, the company is committed to achieving the societal expectation through educational and community efforts and ensure safety, health and protection of the environment. Such activities are anticipated to build the company's reputation and consequently help the company to maximize profit. However, the CSR does not address the stakeholders such as Owners, political groups, government, suppliers, competitors, trade associations, employees, unions, customer advocate groups, customers, activists groups, and financial community (Freeman, 1984).
Analysis of the Dow's CSR
According to the Six Core Characteristics of CSR model, the Dow's CSR has its strength since it has accomplished almost all the six characteristics. The Dow's CSR is voluntary, manages externalities, integrate multiple stakeholders, and aligns to the social and economic factors. The CSR is voluntary in such a way that the company believes that being a good neighbor serves to be an active partner within the community. On the managing externality characteristics, the company is committed to protecting the environment and ensure the safety and health of the community where they operate. In addition, the company believes in creating long-term relationships with the key stakeholders to enhance the success of their operations. The social and economic alignment of this CSR is that the company creates employment and education programs for the community. However, the company's CSR fails to go beyond the philanthropy. This is because the motives of the CSR are focused on promoting the value of the firm as the company addresses the community's interests. The Dow's CSR is not only socially successful but also financially effective. For instance, building the relationships with the key stakeholders such as the community is anticipated to achieve the success of the business.
Similar to the model indicated above, Smith's model illustrates that Dow's CSR is strong because it is integrating all the stakeholders. Although the CSR does not elaborate on the key stakeholders, it mentions on the significance of building a strong relationship with their key stakeholders. As illustrated by Smith (2003, p.29), the engagement of the stakeholders "is more likely to lead to informed management thinking and decision making on its obligations and appropriate actions with respect to this group." The Dow's CSR also indicates the appropriate "key performance indicators" (KPI's) which measure the social and environmental performance derived from the CSR. For instance, the CSR indicates that in the previous year, the employees in the Houston Operation contribute to about $30,000 to the Unite Way (The Dow Chemical Company, 2016). This metrics shows that the company has successfully implemented the CSR.
The company's CSR is also realistic and ambitious. For example, the CSR states that the company aims to enhance the relationship with the community and other stakeholders to achieve the success of their operations. To do this, the company has to focus on enhancing educational efforts and creating employment among other community efforts. In doing so, the company realizes the community and business are interdepended and hence integrating them together to achieve their goals and purpose.
However, the Dow's CSR has some weaknesses such as failing to balance the stakeholders' interest, and it is not unique. The company has chosen to exercise their commitment to the social issues and does not elaborate on other stakeholders such as consumers, investors, and suppliers. According to Smith (2003, p.35), management actions might be focused on the addressing the society's best interest, and in normative case, this might contribute to the long-term contribution of the firm. However, this does not guarantee that these actions can achieve the long-term interests of the firm. In addition, the Dow's CSR is not unique on its own because it comprises of the practices that are run by many organizations in the business world. For instance, many organizations use the creation of employment and education programs as the main components of their CSR similar to the case of the Dow Chemical Company.
My Recommendations on Dow's CSR
The Dow's management should ensure that their CSR is unique and reflects the company's value and mission. In such way, the Dow Chemical Company will be in a position to make CSR that is different from that of the main competitors for their mission and values are unique (Smith, 2003). In addition, the company should focus on enhancing the balance of the stakeholders' interests. According to Smith, the company should be in a position to trade off and balance the competing claims of the suppliers, customers, investors, employees, and the community where they operate. In other words, the Dow's CSR should address the interests of all the stakeholders rather than an only community to ensure the long-term interest of the firm.
CSR strategies that are recommended by scholars
According to Kistruck & Beamish (2010), one of the strategies that can be integrated into the Dow's CSR is the social entrepreneurship. This strategy involves utilizing the business techniques to address the social problems. This is a call for the company to enhance the CSR beyond philanthropy through social entrepreneurship. The company should utilize the social entrepreneurs to establish direct initiative aimed at solving the social and environmental problems profitably. For instance, developing initiatives " within the nonprofit sector by way of the application of for-profit skills to nonprofit management or the introduction of commercial activities to traditional donor funding" (Kistruck & Beamish, 2010, p.737).
In addition, the company should use the Triple Bottom Line strategy to take into account environmental, social, and economic aspects of the sustainable development. The third strategy that can be utilized to enhance the Dow's CSR includes The Bottom of the Pyramid Strategy. This strategy involves serving the poor community through the CSR. Prahalad & Hammond (2002, p.6) asserts, "business can gain three important advantages by serving the poor - a new source of revenue growth, greater efficiency and access to innovation." Therefore, for Dow Chemical Company to drive the top-line growth from the CSR it needs to incorporate the Triple Bottom Line strategy among other strategies mentioned above.
References
Freeman, R. E. (1984). Stakeholder management: framework and philosophy; Chapter 3, Strategic management: A stakeholder approach. Boston: Pitman.
Kistruck, G.M. and Beamish, P.W., 2010. The interplay of form, structure, and embeddedness in social intrapreneurship. Entrepreneurship Theory and Practice, 34(4), pp.735-761.
Schwartz, M. S. & Carroll, A. B. (2008). Corporate social responsibility: a three-domain approach. Business Ethics Quarterly, 13(4), 503-530.
Smith, N. C. 2003. Corporate Social Responsibility: Whether or How? California Management Review, 45(4), 1-35. Retrieved from http://facultyresearch.london.edu/docs/03-701.pdf
The Dow Chemical Company. 2016. Corporate Social Responsibility. Retrieved from http://www.dow.com/locations/texas/laporte/sustainability/corporate_social_responsibility/
