Module 7

CORPORATE SOCIAL RESPONSIBILITY

What is Social Responsibility?

Social responsibility is the idea that businesses should
balance profit-making activities with activities that benefit
society. It involves developing businesses with a positive
relationship to the society in which they operate. The
International Organization for Standardization (ISO)
emphasizes that a business' relationship to its society and
environment is a critical factor for operating efficiently and
effectively.
Social responsibility means that individuals and companies
have a duty to act in the best interests of their environments
and society as a whole. Social responsibility, as it applies to
business, is known as corporate social responsibility (CSR).
Many companies, such as those with "green" policies, have
made social responsibility an integral part of their business
models.
What is CSR?
Corporate social responsibility (CSR) 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, also called
corporate citizenship, 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 enhances society and
the environment, instead of contributing negatively to it.
In other words, “Corporate responsibility is simply a way for
companies to take responsibility for the social and
environmental impacts of their business operations.”

Corporate social responsibility is a broad concept that can

take many forms depending on the company and industry.
Through CSR programs, philanthropy, and volunteer efforts
businesses can benefit society while boosting their own
brands. As important as CSR is for the community, it is
equally valuable for a company. CSR activities can help
forge a stronger bond between employee and corporation;
they can boost morale; and can help both employees and
employers feel more connected with the world around
them.

In order for a company to be socially responsible, it first

needs to be responsible to itself and its shareholders. Often,
companies that adopt CSR programs have grown their
business to the point where they can, and want, to give
back to society. Thus, CSR is primarily a strategy of large
corporations. Also, the more visible and successful a
corporation is, the more responsibility it has to set standards
of ethical behavior for its peers, competition, and industry.

Business benefits of corporate social responsibility

Corporate social responsibility (CSR) has many advantages

that can apply to any business, regardless of its size or
sector.
Benefits of corporate social investment for businesses

The potential benefits of CSR to companies include:

 better brand recognition

 positive business reputation
 increased sales and customer loyalty
 operational costs savings
 better financial performance
 greater ability to attract talent and retain staff
 organisational growth
 easier access to capital

Responsible business reputation

Corporate social investment can help you to build a

reputation as a responsible business, which can, in turn, lead
to competitive advantage. Some customers don't just prefer
to deal with responsible companies - they insist on it.

Costs savings

By reducing resource use, waste and emissions, you can

help the environment and save money too. With a few
simple steps, you may be able to lower your utility bills and
achieve savings for your business.

Finding and keeping talented staff

Being a responsible, sustainable business may make it easier

to recruit new employees or retain existing ones. Employees
may be motivated to stay longer, thus reducing the costs
and disruption of recruitment and retraining.
Other benefits of CSR to companies

By acting in a sustainable, responsible way, you may also

find it easier to:

 access finance - investors are more likely to back a

reputable business
 attract positive media attention - eg when taking part in
community activities
 reduce regulatory burden - good relationships with
local authorities can often make doing business easier
 identify new business opportunities - eg for
development of new products or services

Ways to practice CSR

Recognizing how important social responsibility is to their

customers, many companies now focus on and practice a
few broad categories of CSR:

1. Environmental efforts: One primary focus of corporate

social responsibility is the environment. Businesses regardless
of size have a large carbon footprint. Any steps they can
take to reduce those footprints are considered both good
for the company and society.

2. Philanthropy: Philanthropy means “the desire to promote

the welfare of others, expressed especially by the generous
donation of money to good causes.” Businesses can also
practice social responsibility by donating money, products
or services to social causes. Larger companies tend to have
a lot of resources that can benefit charities and local
community programs.
3. Ethical labor practices: By treating employees fairly and
ethically, companies can also demonstrate their corporate
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 support for certain
organizations.

CSR AND ENVIRONMENTAL MANAGEMENT

The major ingredients of environmental CSR are the

elimination of waste and emissions, maximizing energy
efficiency and productivity and minimizing practices that
may adversely affect the use of natural resources by
coming generations.

Sustainability and carbon footprints occupy an increasingly

important position on the corporate agenda around the
world. Many companies are realizing the importance of
environmental initiatives in business development.

A decrease in energy and raw material usage combined

with reduced emissions and waste generation can tackle
the environmental challenges facing the world.

Leading IT companies, like Microsoft, Adobe, Apple, and

Google, are investing in renewable sources of energy that
can generate power directly on-site. Clean manufacturing
practices and energy-efficient design of equipment are also
hallmarks of environmental sustainability.

Role of Packaging

Packaging is an important concern for consumers,

particularly those who are interested in converting to eco-
friendly buying behaviors. Packaging plays a great role in
environmental sustainability by protecting products,
preventing waste and enabling efficient business conduct.
Reduction in the amount of packaging and use of eco-
friendly packaging material provides an attractive
opportunity to promote environmental sustainability.

Sustainable packaging is a relatively new addition to the

environmental considerations for CSR. Companies using
environment-friendly packaging materials are reducing
their carbon footprint, using more recycled materials and
minimizing waste generation. Companies that highlight their
environmental initiatives to consumers can increase sales as
well as boost product reputation.

For example, Cisco outsources all of its manufacturing and

has over 600 suppliers. To avoid any problems, Cisco’s
packaging team undertakes a painstaking process to
create more effective and environmentally friendly
packaging. In 2012, the company eliminated 757,000
pounds of paper and plastic waste for one product line
alone. For its total shipments during 2012, Cisco reduced its
use of cardboard, plastic, and paper by as much as 466
metric tons.
Socially Responsible Companies Must First Meet Business
Responsibilities

In general, businesses have a hierarchy of responsibilities to

meet, ranging from the basic (making a profit) to the
benevolent (benefiting society). Here are some examples:

 Economic Responsibilities - A business exists to make a

profit for shareholders. If it fails to do so, it likely won’t be
able to pay its employees, taxes and other obligations.
A corporate social responsibility program (CSR
program) cannot be implemented until a business is
profitable.

 Legal Responsibilities - Following the law is the

foundation of corporate responsibility. A company
cannot benefit society if it does not adhere to labor
and tax laws or applicable industry regulations.

 Ethical Responsibilities - Once a company is profitable

and meets its legal responsibilities, it can move up the
ladder to ethical responsibilities, which might include
paying higher wages, offering employees better
benefits, avoiding trade with unscrupulous companies
or providing jobs to those who would otherwise have
difficulty finding work.

 Philanthropic Responsibilities - As a company meets its

economic, legal and ethical responsibilities, it can
consider taking on philanthropic responsibilities.
Corporate philanthropy ranges in size and scope, and
can include everything from donating time to a local
charity to building a children’s hospital.
Types of Corporate Social Responsibility Programs

Many non-profit and charitable organizations can benefit

from corporate social responsibility programs. Local and
national groups such as food banks, shelters and the Red
Cross receive donations of cash and volunteer labor from
businesses all across the country. This direct giving is one
type of CSR program.

Many companies can also choose to take a long-term,

strategic look at CSR. They actually create products or
provide services that help fill a societal need. Examples
include:

 A company that specializes in job training for disabled

adults
 A business that aims to find alternative uses for used
goods, to keep them out of landfills
 A group that brings investors into a declining area to
revitalize it and create green technology jobs

Some firms have a strong foundation of corporate social

responsibility, which governs everything from the products
and services they produce to the hours they dedicate to
volunteer work.

Three Companies Known for Corporate Social Responsibility

Companies that are profitable, follow the law and have

strong corporate social responsibility programs are more
common than you think. Here are three of the most widely-
known, successful companies that are also good corporate
citizens:
1. IBM - The technology giant has been environmentally
friendly for decades, with a focus on developing more
efficient supply chains, and creating technology that
helps other companies achieve their sustainability
goals. IBM also promotes employee well-being and
diversification, and works on issues such as education,
health, literacy, and culture.
2. Google - For many people, their first exposure to a
corporation working for “good” was related to Google.
The search giant has made aggressive moves on
multiple fronts toward good citizenship, but it is clear
that, as one of the world’s largest corporations, every
single effort is paying off. For example, Google Green is
a corporate effort to use resources efficiently and
support renewable power. But recycling and turning off
the lights does more for Google than lower costs.
Investments in these efforts have real-world effects on
the bottom line. Google has seen an overall drop in
power requirements for their data centers by an
average of 50 percent. These savings can then be
redirected to other areas of the business or to investors.
3. Starbucks - Long before its initial public offering (IPO) in
1992, Starbucks was known for its keen sense of
corporate social responsibility, and commitment to
sustainability and community welfare. Starbucks has
achieved CSR milestones such as reaching 99 percent
ethically sourced coffee; creating a global network of
farmers; pioneering green building throughout its stores;
contributing millions of hours of community service; and
creating a groundbreaking college program for its
partner/employees. Going forward, Starbucks’s goals
include hiring 10,000 refugees across 75 countries;
 reducing the environmental impact of its cups; and
engaging its employees in environmental leadership.

Corporate Social Responsibility Programs Can Benefit

Everyone

A strong commitment to corporate social responsibility

programs can protect and enhance a company’s brand.
As the word gets out about a company’s good works, it can
help create a positive working environment, boost sales and
attract desirable employees. Everyone can benefit when
companies focus on social responsibility.
 Chapter 7
ALTERNATIVE FUTURE

PEOPLE, THE ENVIRONMENTAL CRISIS, AND THE FUTURE OF

LIFE ON EARTH

People have the capacity to change the world. Humans

are God’s special beings gifted with the highest levels of
intellect. As dominant shapers of this planet, we can employ
science and technology to come up with environmental
designs that are remarkably sustainable, flexible yet strong,
and above all to be a factor in enhancing environment and
its resources for the benefit of all, regardless of race,
education, wealth and religion. All nations must work
together and cooperate to realize a better future.

DRIVE THE FUTURE WHILE GOING SOLAR

Solar Energy – refers to capturing the energy from the Sun

and subsequently converting it into electricity. We can then
use that electricity to light up our homes, streets, and
businesses, and power our machines as well.

Why is there a need to go solar?

With the continuous increase in the price of almost all

commodities brought about by accelerating cost of fuel,
not to mention the equivalent swelling of environmental
and health problems, alternatives to go solar or “natural”
has intensified. Moves to save money (cost), people’s
health, and Mother Earth, in general. Has given much
attention in recent times in an attempt to save the future.

PROs and CONs of Solar Energy

Advantages Disadvantages
Renewable Energy Cost
Source
Reduces Electricity Weather
Bills Dependent
Diverse Solar Energy Storage
Applications is Expensive
Low Maintenance Uses a lot of Space
Costs
Technology Associated with
Development Pollution

Going further from being personal, solar energy provides

clean energy. Unlike other sources of energy, solar energy is
environmental-friendly. As such, human health is also
protected.

Therefore, it all sums up to SUSTAINABILITY.

WHAT IS ENVIRONMENTAL SUSTAINABILITY?

Sustainability is the ability to continue a defined

behavior indefinitely. It is the study of how natural systems
function, remain diverse and produce everything it needs
for the ecology to remain in balance. It also acknowledges
that human civilization takes resources to sustain our
modern way of life.
 Environmental sustainability is the rates of renewable
resource harvest, pollution creation, and non-renewable
resource depletion that can be continued indefinitely. If
they cannot be continued indefinitely then they are not
sustainable.

Thankfully, with the aid of science and technology, more

options are made available. Choosing he right alternative is
another thing. Our decisions are based on personal feelings,
tastes and preference or opinions.

Challenge:

What can you do to make a change? Will you accept the

challenge and make a difference? After all there is only one
planet Earth. Unless you want to live in Mars.