CSR

Introduction of CSR

What is Corporate Social responsibility?
The history of CSR is as old as trade and business itself. It is a self-regulating business model
that helps a company be socially accountable — to itself, its stakeholders, and the public. By
practicing corporate social responsibility, companies can be conscious of the kind of impact
they are having on all aspects of society including economic, social, and environmental. To
engage in CSR means that, in the normal course of business, a company is operating in ways
that enhance society and the environment, instead of contributing negatively to them.
Chandler’s Ten Principles provide guideposts to ensure rich discussion, careful thought,
and a realistic 21st century understanding of the role of business in society. I’m going to
discuss two principles stakeholders and their part in CSR and


Stakeholders
Identifying stakeholders

Stakeholders can affect or be affected by the organization’s actions, objectives and policies.
In corporation the primary stakeholders are it’s investors, employees, customers and
suppliers. However, the modern theory of the idea goes beyond this original notion to
include additional stakeholders such as a community, government or trade association.
Any firm is a legal person but it can’t exist without its stakeholders. To understand and
identify stakeholders interests we need to divide them into three groups: organizations
stakeholders, economic and societal. First of all, because directors, managers and
employees are internal for the company and main part of it, they are primary concern for it.
Then comes economic stakeholders who are: consumers, competitors, shareholders and
creditors. Main reason they are concerned about is firms financial part. Last but not least
are media government agencies… And they are important for a firm to survive on a long run.

Even thought it is easy to identufi stake holders it is hard to prioritaize them. It’s hard
because every stake holder has a different interest so it’s important to have a “guidbook”
which helps managers to decide to when and which stakeholders interest to prioritaixze.
Each stakeholder group “will define the purpose of the business in terms of its own needs
and desires, and each perspective is valid and legitimate.” By identifying the firm’s key
stakeholders within each category, managers can prioritize the needs and interests of
certain groups over others. However a firm must be aware that it can’t consistently ignore
the interest of one stakeholder even if it is less important than the other. All of these is
combines in four-step process that consists of:
1. Identify the set of stakeholders that are relevant and important to
the firm and seek to build long-term relationships with each stakeholder.
2. Analyze the nature of each issue as it arises to see how it relates to
firm operations.

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3. Prioritize among the stakeholders and their competing interests and
demands.
4. Act as quickly as is prudent, attempting to satisfy as many stakeholders,
in order of priority, that is feasible.
Also another way is to map out stakeholders, and classify them according to their power
over work and their interest in it, on a Power/Interest Grid.




.

The position that you allocate to a stakeholder on the grid shows you the actions you need
to take with them:

• High power, highly interested people (Manage Closely): you must fully engage these
people, and make the greatest efforts to satisfy them.
• High power, less interested people (Keep Satisfied): put enough work in with these
people to keep them satisfied, but not so much that they become bored with your
message.
• Low power, highly interested people (Keep Informed): adequately inform these people,
and talk to them to ensure that no major issues are arising. People in this category can
often be very helpful with the detail of your project.
• Low power, less interested people (Monitor): again, monitor these people, but don’t
bore them with excessive communication.

Let’s take Microsoft as an example and discuss it’s stakeholders. For this company priority is
it’s customers. This groups feedback and insights are critical in shaping how firm enhance
existing products and services and develop new ones. From customers firm gains online
feedback, support communities, product satisfaction surveys… After customers come
investors. Investors are an important influence as they consider ways to enhance their

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 corporate governance principles and policies to serve the interests of their shareholders and
other stakeholders. After that are employees. Even though they are third in line they are
really important. From my point of view employees must be every companies priority,
because if they are happy they do good job and company does well too and if employees
are unsatisfied by their conditions and work environment than they won’t do their best and
this will have a big impact on company.

Business ethics and CSR

Ethics are codes of values and principles that govern the action of a person, or a group of
people regarding what is right and what is wrong. In the business setting, being ethical
means applying principles of honesty and fairness to relationships with coworkers and
customers (Daft 2001).
Business leaders and organizations can examine how their decisions relate to social
responsibility, which is a general concept that can include social as well as cultural,
economic and environmental issues. By integrating business ethics and principles of social
responsibility, organizations can make a difference in the world and enhance their
reputation.
Some companies have adopted the social entrepreneurship model of business that focuses
on applying practical, innovative and sustainable approaches to benefit society. The shoe
retailer TOMS is one of the most popular examples of the social entrepreneurship model.
For every pair of shoes sold, the company provides a new pair of shoes to children in
developing countries.
Another example of combining business ethics and social responsibility is by focusing on
benefiting the environment. Forbes notes some of the reasons why Seventh Generation, a
Burlington, Vermont-based company that produces and distributes green products, was
recognized as the best company for the environment.
• Selling products such as biodegradable, vegetable-based cleaning products, chlorine-free
tampons and paper towels and natural lotion baby wipes.
• Developing an employee bonus program that awards workers who figure out how to make
the company’s goods even more sustainable.

Human rights and CSR

Human rights are relevant to the economic, social and environmental aspects of corporate
activity. For example, labor rights requiring companies to pay fair wages affect
the economic aspect. Human rights such as the right to non-discrimination are relevant to
the social aspect. And the environmental aspects of corporate activity might affect a range
of human rights, such as the right to clean drinking water. So, while the primary
responsibility for the enforcement of international human rights standards lies with national

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 governments, there is a growing acceptance that corporations also have an important role
to play.

Corporations have come to recognize that part of being a good corporate citizen includes
respecting the human rights of those who come into contact with the corporation in some
way. This might be direct contact (for example, employees or customers), or indirect contact
(for example, workers of suppliers, or people living in areas affected by a corporation’s
activities).

Corporations are also responding to the fact that many consumers and investors expect
corporations to act in a socially responsible manner. The extent to which a company
implements a comprehensive CSR program can influence consumer and investor decisions.

Employee rights and CSR

Part of being socially responsible for a corporation means participating in ethical labor
practices. These practices can include:

• Offering more competitive salaries to employees

• Offering more competitive compensation packages
• Providing generous parental leave
• Offering tuition reimbursement

Following ethical labor practices reflects well on companies and causes more individuals to
want to work with them.

Environment and CSR

Environmental CSR aims to reduce any damaging effects on the environment from your
business' processes. Activities may focus on:
• energy use
• water use
• waste management
• recycling
• emissions
• eco-friendly office and business travel policies
Some of these are significant from both environmental and financial point of view.

Let’s take few examples.

Google on average, a Google data center is twice as energy efficient as a typical enterprise data
center. They've been carbon neutral for over a decade by improving the efficiency of their
operations and buying renewable power and high-quality carbon offsets. In 2018, they
matched 100% of the electricity consumption of their operations with purchases of renewable
energy for the second consecutive year.

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Johnson & Johnson have focused on reducing their impact on the planet for three decades.
Their initiatives range from leveraging the power of the wind to providing safe water to
communities around the world. Its purchase of a privately-owned energy supplier in the
Texas Panhandle allowed the company to reduce pollution while providing a renewable,
economical alternative to electricity. The company continues to seek out renewable energy
options with the goal to procure 35% of their energy needs from renewable sources.

Ford plans to reduce their greenhouse gas emissions using their EcoBoost engine to increase
fuel efficiency. It also plans to introduce 40 electrified vehicles by 2022.

CSR Categories
Recognizing how important socially responsible efforts are to their customers, employees
and stakeholders, many companies now focus on a few broad CSR categories:

1. Environmental efforts: One primary focus of corporate social responsibility is the

environment. Businesses, regardless of size, have large carbon footprints. Any steps
they can take to reduce those footprints are considered good for both the company and
society.
2. Philanthropy: Businesses can practice social responsibility by donating money, products
or services to social causes and nonprofits. Larger companies tend to have a lot of
resources that can benefit charities and local community programs. It is best to consult
with these organizations about their specific needs before donating.
3. Ethical labor practices: By treating employees fairly and ethically, companies can
demonstrate their social responsibility. This is especially true of businesses that operate
in international locations with labor laws that differ from those in the United States.
4. Volunteering: Attending volunteer events says a lot about a company's sincerity. By
doing good deeds without expecting anything in return, companies can express their
concern for specific issues and commitment to certain organizations.


To conclude, key CSR issues are: environmental management, eco-efficiency, responsible
sourcing, stakeholder engagement, labor standards and working conditions, employee and
community relations, social equity, gender balance, human rights, good governance, and
anti-corruption measures.
A properly implemented CSR concept can bring along a variety of competitive advantages,
such as enhanced access to capital and markets, increased sales and profits, operational
cost savings, improved productivity and quality, efficient human resource base, improved
brand image and reputation, enhanced customer loyalty, better decision making and risk
management processes.

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Reference

Corporate social Responsibility – David Chandler

Stakeholders analysis – Rachel Thompson

Ethics in business – Grace collage

Human rights and CSR – Human rights law resource center

ECSR – Thomas P.Lyon and John W.Maxwell

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Table of contents
Introduction of CSR………………………………………………………………………………………….1
Stakeholders …………………………………………………………………………………………………..1
Business ethics and CSR…………………………………………………………………………………..3
Human rights and CSR…………………………………………………………………………………………..3
Employee rights and CSR……………………………………………………………………………………….4
Environment and CSR ( with examples)……………………………………………………………………………..…4
CSR Categories…………………………………………………………………………………………………….5
Reference…………………………………………………………………………………………………………..6