Corporate social responsibility (CSR) can be described as a movement whose primary aim is to ensure all stakeholders in a particular business benefit appropriately and equally (Agarwal et al., 2018). It provides that companies become more aware of the consequences of their primary business operations and decisions to the extent of affecting their surrounding environment. It also acts as a business approach which is used to ensure sustainable development by achieving economic, environmental and social benefits across all operations.
Corporate social responsibility is also useful in implementing changes to ensure better achievements are focused towards sustainability. Hence, it is the responsibility of all companies to realize that it is their role to bring about sustainability and provide better practices which can be applied in the general environment (Agarwal et al., 2018). Companies can also use some unique and remarkable efforts which engage unique corporate social responsibility initiatives to improve the aspect of business ethics across all critical stakeholders.
A significant example of a company that has applied great corporate social responsibility strategies is the Unilever Company. It is well known for its leadership in the food industry, and this is major because it has comprehensive techniques which it applies to remain highly competitive in the business environment. For instance, the Unilever Company has used its corporate social responsibility techniques by partnering with other organizations such as the Rainforest Alliance to ensure proper benefits to all of its primary stakeholders (Agarwal et al., 2018).
Business ethics on the other end represent all the ethical principles or morals which are applied in certain organizations and companies to offer an environment which is free from any ethical problems (Weiss, 2009). Business ethics also act as professional ethics which are morally applied to an organization to ensure fairness in the delivery of services as well as the production of quality products which attain maximum customer satisfaction. They provide that business operations are conducted in the right manner which calls for the entire workforce to cooperate. Their origin is the legal systems which offer statements to be followed by all individuals that are involved in any types of business operations.
Business ethics from a broader perspective represent the organizational standards, values, and principles which govern how all individuals should behave or instead conduct themselves as they work (Weiss, 2009). Hence, the significant difference between corporate social responsibility and business ethics comes in that the first acts as a business approach to ensure that all stakeholders benefit fully while the latter provides that all individuals in an organization conduct themselves in an ethical manner which ensures strict following of the business standards, values, and principles.
Benefits of Effective CSR
An active corporate social responsibility contains benefits both to the organization as well as the rest of the business stakeholders involved. For instance, a company that applies strict and advanced corporate social responsibility techniques is always assured of amicable decisions between all the involved parties. This is because there is a clear outline which governs how much share each stakeholder is to obtain based on their ultimate contribution (Kielmas, 2018). This thereof means that an effective corporate social responsibility boosts the bottom line of all organizational workforces. This is because they are all directed towards the achievement of all goals and objectives of a particular business operation geared towards success.
At this point, corporate social responsibility calls for the application of business ethics which ensure that all principles, standards, and values are followed to the latter so that better decisions may be generated to favor every individual involved. Additionally, an effective corporate social responsibility program in an organization attracts new talents as well as investors (Kielmas, 2018). This is because many professionals out there looking for a well-organized company to invest in because they are well assured of quality work results as well as maximum benefits.
Such an organization ensures to attract more talents because every skilled professional looks forward into working with organizations which are ethically sensitive as well as have well-organized corporate social responsibility strategies to apply in their business operations (Kielmas, 2018). This way, no risks can be involved because every individual is only focused on ensuring fairness from the fact that they can engage in clean deals and achieve success just in the right manner.
Drawbacks to CSR
A significant disadvantage to the corporate social responsibility programs is that they are too costly. This is because they tend to increase a company's expenditure and this brings in challenges in balancing the shareholder and stockholder interest. The increased spending of the company is however reflected in the increase in the prices of their products which are placed on the customers to pay (Evans, 2017). Hence, balancing between shareholder and stockholder interest is challenged since the company ends up spending more than it has budgeted for. The cost of creating and maintaining a corporate social responsibility program calls for extra expenses which have to be placed on the new workforce required to ensure their application is successful.
Another disadvantage is that a corporate social responsibility program tends to drift away from the primary purpose of a business which is to make profits. It tends to shift away from its interest into ensuring the shareholder's benefit as promised while it forgets about its benefits as well (Evans, 2017). Hence, it has been known that corporate social responsibility programs can bring in losses as a company may in the process forego its profits to ensure that the shareholder's benefit.
Role of Organizational Values in CSR
The purpose of organizational values in corporate social responsibility can be described as always to ensure sustainability in the running of business operations to keep attracting more clients as well as investors. The organizational values are embedded in its business ethics, and this governs how its workforce conducts themselves in a manner that promotes all ethical values and principles (Schettino, 2016). Hence, business ethics and corporate social responsibility work hand in hand to ensure that an organization only engages itself in legit business operations whereby all of its shareholders and stakeholders acquire an equal share as they have agreed.
An organization cannot, however, prosper in any business operation without its defined values and standards and therefore it acts as the origin of its achievement of goals and objectives. Additionally, organizational values also touch on the way a business affects its environment (society) and how best it can act to ensure that it provides the best of services which are beneficial both to it as well as the community (Schettino, 2016). Lastly, the values of an organization place in a better perceptive of its success and therefore this ensure that it can eventually succeed in the application of corporate social responsibility techniques to ensure success.
Overall Impact of CSR on Contemporary Organizations
International ethics consider the best of corporate social responsibility techniques to be applied so that companies may stay relevant in the business market as well as competitive. This is because global ethics defines certain ethical principles and standards which should be strictly followed by all organizations if at all they are interested in achieving international corporate social responsibility strategies in their business operations (Agarwal et al., 2018).
Hence, globalization in corporate social responsibility ensures that organizations are more updated in the kind of techniques they apply to provide equal benefits for both the shareholders and stakeholders of a particular business initiative (Agarwal et al., 2018). This means that the overall impact of corporate social responsibility to organizations is that it promotes the application of business ethics which do away with illegal business deals and only ensure the promotion of business operations which are beneficial both to the company as well as the society.
The cultural dimensions of corporate social responsibility are that proper ethics should be strictly applied so that equal and fair benefits can be used to all stakeholders without any application of corrupt ways (Agarwal et al., 2018). Better implementation of corporate social responsibility strategies ensure opening of new opportunities concerning the interest of new clients and investors in a particular company's business operations.
In conclusion, corporate social responsibility works hand in hand with business ethics to ensure the sustainability of business operations is successfully attained. Also, these two concepts ensure that an organization runs the right types of business operations which are beneficial to its stakeholders as well as the society. This ensures that proper achievement of all economic, social and political needs is implemented for better business results.
Also, business ethics applied in an organization ensures that the workforce conducts itself in the best manner possible so that they may even attract new investors and continue earning better profit margins. Hence, each organization should look forward towards the application of corporate social responsibility programs in conjunction with business ethics so that they may prosper and even quality to be relevant in the global market.
Agarwal, D., Bersin, J., Lahiri, G., Schwartz, J., & Volini, E. (2018). "Citizenship and Social Impact: Society Holds the Mirror." Deloitte Insights.
Evans, K. (2017). "What are the Disadvantages of Corporate Social Responsibility?" Bizfluent.Kielmas, M. (2018). "Pros & Cons of Corporate Social Responsibility." Chron.
Schettino, A. (2016). "What is Your Role in Corporate Social Responsibility?" Legal Island.
Weiss, J. W. (2009). "Business Ethics: A Stakeholder and Issues Management Approach with Cases (5 ed.)." Mason, OH: South-Western Cengage Learning.
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