Corporate Social Responsibility

Corporate Social Responsibility

A company’s mission and vision, prestige, financial security, andreputation are no longer the only criteria that make a company stand out. Corporate social responsibility or CSR, also sometimes referred to as corporate conscience, is a model that ensures a company operates in adherence to legal, ethical, or safety standards as they engage in business. 

There are many different ways and levels by which a company could incorporate CSR into its operation but to a certain extent, it involves going beyond what is required and expected by the law. CSR encompasses a sense of duty to the society that goes beyond the business goals of a company. CSR aims make a positive social impact while engaging in business. One of the most common strategies to promote CSR is environmental consciousness. 

Many companies have adopted CSR for several reasons that are perceived to be contributors to a company’s long-term existence. From the human resource perspective, the model facilitates recruitment and reduces attrition. CSR helps project a good image to its employees. Since manpower is important in carrying out socio-civic activities like charities and fundraising activities, CSR helps attract employee involvement and participation. 

From the perspective of risk management, CSR helps a company maintain a reputation that takes years to establish. Accidents and scandals are notorious in destroying a company’s reputation instantaneously the moment that they are broadcasted on the news and social media. 

From a business standpoint, CSR is a good method for brand differentiation. Brand differentiation is what makes a company different from the rest. Many companies use CSR to position themselves in the market by attracting consumers through the use of their social contributions.

One way to evaluate the effectiveness of a company’s CSR is the “triple bottom line” criteria: people, planet, and profit. “People” deals with how companies treat their employees, the community, and the area or region where the business operates. “Planet” deals with practices of sustaining the environment as a company operates. “Profit” is the income made after all costs or liabilities including the cost of the capital have been deducted. Many companies have used these criteria to be more aware of their social and moral obligations.

Some prominent companies that have incorporated CSR with their business models are Google, Starbucks, and The Body Shop.Although many companies see the value in investing in a sound CSR model, Corporate Social Responsibility still continues to bescrutinized by critics. Some people feel that from a social advocacy, companies have taken advantage of CSR merely as a business strategy to make more profit, while others say that CSR gets in the way of economic prosperity. Nevertheless, companies and businesses still choose the route of adopting CSR.