Discussion On Corporate Social Responsibility

Corporate Social Responsibility

Discuss about the Discussion on Corporate Social Relationship.

Corporate Social Responsibility can be defined as the legal, ethical, economic and flexible expectation that any society have at a given point of time (Clapp & Rowlands, 2014). This concept shows the moral, ethical and charitable responsibilities along with the responsibilities for earning reasonable return for the investors and compiling it with the law. Organizations requires an adaptation for a broader view to focuses its responsibilities that, not only focuses on the stockholders but also focuses the suppliers, employers, local, state and  federal governments and special interest groups. This essay contains the broad and the narrow views of the corporate social responsibility, the main reason that any business organization follows the broader views along with the Kant’s ethics that supports the broader view of the CSR.

Corporate Social Responsibility is related to the business ethics, while business ethics deals with the moral judgments, and the attitude of the individuals present in the organization, whereas, CSR circumscribes ethical, legal, economic and flexible duties towards the organizations. They are expected to be profitable and efficient (Clapp & Rowlands, 2014).

The ethical concern focuses on the expectation of the societies that moves beyond the law. The expectation of the organizations will perform their affairs on the particular norms that are not formally enacted in law (Ragas & Culp, 2014).

CSR is a concept of management on which the companies integrate the social along with the environmental issues in the operations and during the interactions between the stakeholders of the organizations. The research that was conducted past two years stated the corporate social responsibility had paid well for both the stakeholders and the companies.

Corporate Social Responsibility extends for the obligation on ethical issues towards the stakeholders. On increasing influential power for the arguments of the corporations regarding the companies’ responsibilities towards the stakeholders beyond the profit making have also increased.

CSR acts a commitment for the business organization that required for maintaining the morality and the ethical issues that can contribute the development economically for improving the standard quality of lifestyle for the workforce, families, societies and the communities. CSR is considered as the most dispute areas in the sector of business. There are existences of two extreme views as well as opinions regarding the case of social responsibilities in an organization. According to the classical views, which suggests that business enterprises has the motive of making profits and one specific responsibilities for the society is to provide the goods and the products that are necessary for the exchange and obtaining the maximum profit from the stakeholders.

Broader View of CSR

According to the socio economic view the business organization are the part of the larger society and therefore the responsibilities could not be restricted for the profit maximization. The view also leads emphasis on the financial structure of the company. The interest of the company is also liable for the society. Both the classical and the socio economic view is under the scrutiny and there is an extreme argument of the effect of CSR on the society. The businesses are adapting CSR only due to economic interest of the organization.

The narrow view suggested the main objective of the business would be maximizing the profit. According to Levitt business has two major responsibilities towards the society. One responsibility is to apply the fundamentals of basic business and the second responsibility is to earn profit from the business. The argument of Friedmann stated that those businesses are concentrating only on making maximum profit does not contribute for any well being towards the society. The argument further stated that since the corporations are made of artificial people so they only have the responsibilities those are artificial. Since business is an artificial construction the liabilities as well as the responsibilities lies only on the proprietors as well as the executives.

The narrow view also states that the business are been constructed and plans for making money and therefore the executives those are been employees for achieving the goals and the managers should act according to the proprietor. The argument of Freidmann suggested that the executives should have some corporate responsibilities besides making profits. The social responsibilities include spending the money of the shareholders for the interests of general people by spending taxes on the cause of the community.

The argument also stated that the social responsibility that the business should have for the society is making profit according to the law. This will make the business more open as well as competitive without doing any fraud or deception.

The broader view on the Corporate Social Responsibility says that other than gaining profits from the business the business is liable to the communities. The argument by Adam Smith is on the invisible hand. The argument states that the organizations should be independent enough for promoting the self interests by their own and in this phase they would be steered with an invisible hand for doing social good. If the organization is forced for worrying about the CSR they will not be successful in meeting up with the material needs (Preuss, 2013).

Narrow View of CSR

The second argument is also to the support of the narrow view. The second argument stated that the government is liable to regulate the activities made by the corporations. The government should be sure that activities are done in an ethical way. However, it is not possible for the government to regulate the unethical approach of the organizations. They will also not be able for the predictions of the organizational behavior.

The third argument states that the trusting on the organizations for the wellbeing of the society should not be expected. The organizations do not have the suitable expertise for exercising these duties to the society as they are material and project oriented. However, many private organizations have shown their capabilities of providing well being to the society as well as their own interests have been achieved successfully.

The fourth argument stated that the most of the executives in the corporate world lacks the moral or the capabilities of taking decisions regarding social welfare and are ineffective in the field of CSR.

The final argument stated that if the organizations are given the power of the social responsibilities they might use the power as well as the influence to a bad effect that might affect the society to a high level. This argument is not at all right as the business organizations has the power to commercialize and materialize the society if they have not give the power of social responsibilities.

The above arguments become baseless as every organization have suitable power to materialize, commercialize or manipulate the society. Proceeding towards the broader view, the total number of the contention, which claims the broader view, is more acceptance than that of the narrow views towards CSR (Pedersen, 2015).

Firstly, the company should follow up the duties towards the stakeholders, employees. Suppliers, te customers and the required environment.

Secondly, greater responsibilities come from the great power. Large business organization is more influential on the customers than the smaller ones and they need to shop some responsibilities towards the local people and the society (Broad, 2013).

Thirdly, a contract between the society and the business exists that can make and follows the rules, responsibilities and the guidelines on which the business organization will run. When society focuses with the sustainable development, the business organization follows and abides by the preset up rules and norms.

Finally, every organization is considered as a self-individual under the law. As per to the law, every organization have the particular right to speech, right to enter the contracts. Rights is always followed by the duties and therefore it can be stated that every organization have duties towards the society (Ghoul, Guedhami & Kim, 2016).

The main difference between the broader and the narrow views of CSR can be explained more elaborately by the ethical and the application theory in the practical field. According to the stakeholder theory, they are the most communicative persons in any business organization, so they are mostly affected by any norms, policies or rules of the organization. In some cases, the stakeholders have more of moral and legal rights with the organization (Deng, Kang & Low,2013).

For an example, most of the large organizations have multiple stakeholders, in which, few are primary and few can be secondary. At these peculiar situations, the particular organization may or may not have any legal rights towards the organization, but they do have some moral rights for knowing the policies related to the environmental facts. The stakeholders, who are known to be the primary ones, have more duties and many responsibilities towards the customers. Delivering services that functions properly towards the goods. Delivering the goods and the services to the customer are the main duties of the primary stakeholder (Deng, Kang & Low 2013).

The company head would definitely consider the broader view of CSR because the narrow approach or the narrow view focuses on the rights of the stakeholders, which cannot be ignored. Any organization faced criticism for the vast for the unpleasant environment that wasted the natural resources that contributed greatly towards the environment (Preuss, 2013).

The broader approach of any organization even proves the responsibility towards the environment. For the protection of the environment, many groups were formed for it. The secondary stakeholder forms environmental groups for the protection of the environment.

The application of the Kant’s ethics can be in a broader aspect. For an instance, the company must not misinterpreting any kind of the deliberate about its product. It must publish its reports on time to time; so that the consumer can be aware of the service sand the goods that is provided by the company. The business organization must respect the dignity of the human by giving proper respect towards its employees (Korschun, Bhattacharya, & Swain, 2014). The employees must be given proper working environment and health plans for the well-being of the employees to increase the profit.

The broader view is much better in the case of business organization as it creates a link between the societies with the business (Flammer, 2013). An organization when adopts the CSR is able to realize and recognize the benefits of the business in a particular community in a proper adopted manner than to remain flexible that can intersect with with the personal beliefs, values and the policies (Christensen, Mackey & Whetten, 2014).

A business organization must understand the result of the society and with the community that leads to the decision-making, that affects the society or the particular community in a positive way. If any business ignores the moral ethics and the principles, the success can be delayed in that case.

Organizations often focus the engagement in the specific CSR activities; it can help in the reduction a proper inefficient capital growth and more of exposure to the risk factors. The most important activities of CSR that any organization maintains ethically or morally includes, opportunity for employment in equal policies and practices (Servaes, & Tamayo, 2013). Environmentally sound production and the energy saving practices can be adopted. Managements towards the community relations are needed to take up in consideration.

Understanding Kant’s ethical theory focuses on the essential part of the ethical system. Any organization, that implements on the basis of the Kant’s theory will always remains sound ethically and can be able to operate within itself (Vaughn, 2015).

Kant’s provides these practices in his theory for its readers on trusting the ethical views. It relies on the main motive and the good will on the back of the particular action that is not the result of the action (Shafer-Landau, 2014). Organization must use these views for the foundation of the conducting the ethical issues on the platform of right or wrong. This implementation will leads to the positive ethical stability within the society, organization or in a particular community on that particular platform that the company serves (O’Neill, 2013).

Conclusion

It can be concluded that CSR is a type of a duty that every business organization must follow to perform in the particular society where they can function properly in a very responsible manner (Albuquerque, Durnev, & Koskinen, 2014). On the general aspects, business organizations must not be forced to perform those duties. In some organizations, Corporate Social Responsibility is not being maintained as such. Many a times, civil societies, social media, the government forces the business organization to practice CSR.

From the above discussion, it is clear and it is quiet significant for the activation of CSR is helpful to not only the company, employees, the government but also for the society as well. Hence, CSR must be considered within the values and the basic concepts of the organization and in this way the business organization would stop exploiting the society or the community. This concept will lead the organization more responsible without giving any stress to the employees.

References:

Albuquerque, R. A., Durnev, A., & Koskinen, Y. (2014). Corporate social responsibility and firm risk: Theory and empirical evidence.

Broad, C. D. (2014). Five types of ethical theory (Vol. 2). Routledge.

Christensen, L. J., Mackey, A., & Whetten, D. (2014). Taking responsibility for corporate social responsibility: The role of leaders in creating, implementing, sustaining, or avoiding socially responsible firm behaviors. The Academy of Management Perspectives, 28(2), 164-178.

Clapp, J., & Rowlands, I. H. (2014). Corporate social responsibility. The Essential Guide to Global Environmental Governance. Routledge: London, 42-44. Chicago    

Deng, X., Kang, J. K., & Low, B. S. (2013). Corporate social responsibility and stakeholder value maximization: Evidence from mergers. Journal of Financial Economics, 110(1), 87-109.

Deng, X., Kang, J. K., & Low, B. S. (2013). Corporate social responsibility and stakeholder value maximization: Evidence from mergers. Journal of Financial Economics, 110(1), 87-109.

El Ghoul, S., Guedhami, O., & Kim, Y. (2016). Country-level institutions, firm value, and the role of corporate social responsibility initiatives. Journal of International Business Studies.

Flammer, C. (2013). Corporate social responsibility and shareholder reaction: The environmental awareness of investors. Academy of Management Journal, 56(3), 758-781.

Korschun, D., Bhattacharya, C. B., & Swain, S. D. (2014). Corporate social responsibility, customer orientation, and the job performance of frontline employees. Journal of Marketing, 78(3), 20-37.

O’Neill, O. (2013). Acting on principle: An essay on Kantian ethics. Cambridge University Press.

Pedersen, E. R. G. (Ed.). (2015). Corporate social responsibility. Sage.

Preuss, L. (2013). Corporate social responsibility. In Encyclopedia of corporate social responsibility (pp. 579-587). Springer Berlin Heidelberg.

Ragas, M. W., & Culp, R. (2014). Corporate Social Responsibility. In Business Essentials for Strategic Communicators (pp. 109-122). Palgrave Macmillan US.

Servaes, H., & Tamayo, A. (2013). The impact of corporate social responsibility on firm value: The role of customer awareness. Management Science, 59(5), 1045-1061.

Shafer-Landau, R. (2014). The fundamentals of ethics.

Vaughn, L. (2015). Doing ethics: Moral reasoning and contemporary issues. WW Norton & Company.