In today's economic and social environment, issues related to social responsibility and sustainability are gaining more and more importance, especially in the business sector. Business goals are inseparable from the societies and environments within which they operate. Whilst short-term economic gain can be pursued, the failure to account for longer-term social and environmental impacts makes those business practices unsustainable.
Corporate Social Responsibility (CSR) can be understood as a management concept and a process that integrates social and environmental concerns in business operations and a company’s interactions with the full range of its stakeholders.
The Global Compact asks companies to embrace, support and enact, within their sphere of influence, a set of core values in the areas of human rights, labor standards, the environment and anti-corruption.
Corporate social responsibility (CSR, also called corporate conscience, corporate citizenship, social performance, or sustainable responsible business/ Responsible Business) is a form of corporate self-regulation integrated into a business model.
CSR policy functions as a built-in, self-regulating mechanism whereby a business monitors and ensures its active compliance with the spirit of the law, ethical standards, and international norms.
CSR is a process with the aim to embrace responsibility for the company's actions and encourage a positive impact through its activities on the environment, consumers, employees, communities, stakeholders and all other members of the public sphere who may also be considered as stakeholders.
History
The term "corporate social responsibility" came into common use in the late 1960s and early 1970s after many multinational corporations formed the term stakeholder, meaning those on whom an organization's activities have an impact. It was used to describe corporate owners beyond shareholders as a result of an influential book by R. Edward Freeman, Strategic management: a stakeholder approach in 1984.
Approaches
Common approach to CSR is corporate philanthropy. This includes monetary donations and aid given to local and non-local nonprofit organizations and communities, including donations in areas such as the arts, education, housing, health, social welfare, and the environment, among others, but excluding political contributions and commercial sponsorship of events.
Some organizations do not like a philanthropy-based approach as it might not help build on the skills of local populations, whereas community-based development generally leads to more sustainable development.
Another approach is garnering increasing corporate responsibility interest. This is called Creating Shared Value, or CSV. The shared value model is based on the idea that corporate success and social welfare are interdependent. A business needs a healthy, educated workforce, sustainable resources and adept government to compete effectively. For society to thrive, profitable and competitive businesses must be developed and supported to create income, wealth, tax revenues, and opportunities for philanthropy. CSV received global attention in the Harvard Business Review article Strategy & Society: The Link between Competitive Advantage and Corporate Social Responsibility.
A number of reporting guidelines or standards have been developed to serve as frameworks for social accounting, auditing and reporting which includes
The ISO 14000 environmental management standard and The United Nations Global Compact requires companies to communicate on their progress or to produce a Communication on Progress, (COP), and to describe the company's implementation of the Compact's ten universal principles.
Main themes of CSR are Risk management, Brand differentiation, License to operate, Ethical consumerism, Social awareness and education, Laws and regulation, Stakeholder priorities..
Basically, CSR means that a company's business model should be socially responsible and environmentally sustainable. By socially responsible, it means that the company's activities should benefit the society and by environmentally sustainable it means that the activities of the company should not harm the environment.
But currently what we can see is that there is an outburst of enthusiasm for environmental causes only. For example, controlling pollution, global warming, deforestation, mitigate carbon emissions, etc. Whereas it can be said that the same enthusiasm is not seen for social welfare.
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