Corporate social responsibility

Meaning of CSR
Social Responsibility theories
Pyramid of CSR
Contemporary CSR
Corporate Sustainability
Reputation Management
Environmental aspect of CSR
Companies Practices : Environmental aspect of CSR
CSR models
Triple bottom Line
Drivers of CSR
CSR and business ethics
Cases on CSR
CSR and corporate governance

1. Corporate Social Responsibility MS. Preeti bHAskar Assistant Professor

2. Content Meaning of CSR Corporate Social Responsibility theories Pyramid of CSR Contemporary CSR concepts Corporate Sustainability Reputation Management Social impact management Triple bottom Line CSR and business ethics CSR and corporate governance Environmental aspect of CSR CSR models Drivers of CSR

3. Meaning Corporate social responsibility is a gesture of showing the company’s concern & commitment towards society’s sustainability & development. CSR is the ethical behaviour of a company towards society.

4. Society Carrying on business with moral& ethical standards. Prevention of environmental pollution. Minimizing ecological imbalance. Contributing towards the development of social health, education Making use of appropriate technology. Overall development of locality. Employee To provide a healthy working environment. To grant regular & fair wages. To provide welfare services. To provide training & promotion facilities. To provide reasonable working standard & norms. To provide efficient mechanism to redress worker’s grievances. Proper recognition of efficiency & hard work. consumers Supplying socially harmless products. Supplying the quality, standards, as promised. Adopt fair pricing. Provide after sales services. Resisting black-marketing & profiteering . Maintaining consumer’s grievances cell. Fair competition. Responsibility towards:

5. Responsibility towards Government Obey rules & regulations. Regular payment of taxes. Cooperating with the Govt to promote social values. Not to take advantage of loopholes in business laws. Cooperating with the Govt for economic growth & development Responsibility towards Shareholders To ensure a reasonable rate of return over time. To work for the survival & the growth of the concern. To build reputation & goodwill of the company. To remain transparent & accountable

6. Corporate Social Responsibility (CSR) Business Responsibilities in the 21 st Century Demonstrate a commitment to society’s values and contribute to society’s social, environmental, and economic goals through action. Insulate society from the negative impacts of company operations, products and services. Share benefits of company activities with key stakeholders as well as with shareholders. Demonstrate that the company can make more money by doing the right thing.

7. CSR EXAMPLES  IBM UK - Reinventing Education Partnership programme Interactions and sharing of knowledge through a web-based technology - the “Learning Village” software. Culture of openness and sharing of good practice  AVON - a partnership with Breakthrough Breast Cancer, and its Breast Cancer Crusade has raised over 10 million pounds since its launch 12 years ago  TOI’s Lead India campaign, campaign for contribution towards educating the poor

8. Corporate Sustainability

9. Corporate sustainability is an approach that creates long-term stakeholder value by implementing a business strategy that considers every dimension of how a business operates in the ethical, social, environmental, cultural, and economic spheres. It also formulates strategies to build a company that fosters longevity through transparency and proper employee development.

10. Need for Corporate Social Responsibility  To reduce the social cost.  To enhance the performance of employees.  It a type of investment.  It leads to industrial peace.  It improves the public image.  Can generate more profit.  To provide moral justification.  It satisfies the stakeholders.  Helps to avoid government regulations & control.  Enhance the health by non polluting measures.

11. Strategy for corporate sustainability Business case for sustainability Transparency Stakeholder engagement Thinking ahead

12. Business case for sustainability The challenge for many businesses in this new field is to quantify the positive impacts of sustainability. Sustainability can increase revenue, reduce energy expenses, reduce waste expenses, reduce materials and water expenses, increase employee productivity, reduce hiring and attrition expenses, and reduce strategic and operational risks. [2]  Furthermore, sustainable business practices may attract  talent  and generate  tax breaks . [ Transparency Transparency deals with the idea that by having an engaging and open environment in the company as well as the community will improve performance and increase profits. It is an open culture that promotes employee involvement in the innovation and creative processes. Reaching out to the community creates a much bigger team is extremely cheap and provides evaluation from all angles. Companies are looking inward and realizing changes must be made to fulfill environment needs such as energy efficiency, limiting product waste and toxicity, and designing innovative products. One way for companies to accomplish this is through open communications with stakeholders characterized by high levels of information disclosure, clarity, and accuracy. [4 ]

13. Stakeholder engagement Sustainability requires a company to look internally and externally to understand their environmental and social impacts. This requires the engagement of stakeholders to understand impacts and concerns. A business can address sustainability internally by educating employees and seeking to reduce impacts through waste reduction, energy efficiency, etc. Employee engagement can be a powerful motivator by having a philanthropy committee or a green team. As a company looks externally, stakeholders include customers, suppliers, community, and non-government organizations . Thinking ahead Companies have adapted by implementing new creative ideas related to sustainability, such as preparing upgraded technology that can transform the product rather than throwing away old materials. New solutions that improve recycling and waste redirecting can ultimately reduce costs and increase profits. For example,  Wal-Mart  has redirected more than 64 percent of the waste generated by stores and Sam’s Club facilities. In 2009 alone, they recycled more than 1.3 million pounds of aluminium , 120 million pounds of plastics, 11.6 million pounds of mixed paper and 4.6 billion pounds of cardboard. Annually, they expect to save around $20 million and prevent 38 million pounds of waste being sent to landfills .

14. Reputation Management

15. Reputation management refers to the  influencing  and controlling of an individual's or group's  reputation .. Reputation management (sometimes referred to as rep management, online reputation management or ORM) is the practice of attempting to shape public perception of a person or organization by influencing online information about that entity.

16. A recent analysis of 170,000 company ratings from respondents in 15 countries sheds light on which are perceived by consumers as the most socially responsible. Top 10 Lego Microsoft Google Walt Disney Company BMW Group Intel Robert Bosch Cisco Systems Rolls-Royce Aerospace Colgate-Palmolive https://www.forbes.com/sites/karstenstrauss/2017/09/13/the-10-companies-with-the-best-csr-reputations-in-2017/

17. Social impact management

18. Social impact management is about asking a new and broader set of questions regarding the traditional terrain of business. For example, it is common for a business strategy discussion to explore a firm’s purpose in terms of its vision for competitive positioning. What is less common is for that discussion to consider the firm’s intentions and the implications for consumers, employees, and community members, given the different choices around growth objectives and product development. Companies that are breaking the mold are moving beyond corporate social responsibility to social innovation. These companies are the vanguard of the new paradigm. They view community needs as opportunities to develop ideas and demonstrate business technologies, to find and serve new markets, and to solve longstanding business problems.

19. Triple bottom Line

20. Triple bottom line (or otherwise noted as TBL or 3BL) is an accounting framework with three parts: social, environmental (or ecological) and financial. Some organizations have adopted the TBL framework to evaluate their performance in a broader perspective to create greater business value.   A triple bottom line measures a company's degree of  social responsibility , its  economic value , and its environmental impact .

21. Economic Measures Environmental Measures Social Measures Personal income Cost of underemployment Establishment churn Establishment sizes Job growth Employment distribution by sector Percentage of firms in each sector Revenue by sector contributing to gross state product Sulfur dioxide concentration Concentration of nitrogen oxides Selected priority pollutants Excessive nutrients Electricity consumption Fossil fuel consumption Solid waste management Hazardous waste management Change in land use/land cover employment rate Female labor force participation rate Median household income Relative poverty Percentage of population with a post-secondary degree or certificate Average commute time Violent crimes per capita Health-adjusted life expectancy

22. CSR and corporate governance

23. Corporate governance is the system of rules, practices and processes by which a company is directed and controlled. Corporate governance essentially involves balancing the interests of acompany's  many stakeholders, such as shareholders, management, customers, suppliers, financiers, government and the community . Since corporate governance also provides the framework for attaining a company's objectives, it encompasses practically every sphere of management, from action plans and  internal controls  to performance measurement and corporate  disclosure . https://www.investopedia.com/terms/c/corporategovernance.asp

24. Benefits of Corporate Governance Good corporate governance ensures corporate success and economic growth. Strong corporate governance maintains investors’ confidence, as a result of which, company can raise capital efficiently and effectively. It lowers the capital cost. There is a positive impact on the share price. It provides proper inducement to the owners as well as managers to achieve objectives that are in interests of the shareholders and the organization. Good corporate governance also minimizes wastages, corruption, risks and mismanagement. It helps in brand formation and development. It ensures organization in managed in a manner that fits the best interests of all.

25. Drivers of CSR

26. Values: a value shift has taken place within businesses, as a result of which they now not only feel responsible for wealth creation, but also for social and environmental benefits Strategy: being more socially and environmentally responsible is important for the strategic development of an organisation Public pressure: pressure groups, consumers, media, the state and other public bodies are pressing organisations to become more socially responsible. organisations are often driven by one of the above, but see a shift into other spheres over time. In the main, it has been public pressure centred on three key areas that has driven the CSR agenda. These comprise the environment, labour standards and human rights. Ref: Simon Zadek , P Pruzan & R Evans (1997)

27. Environmental aspect of CSR

28. A ccording to the concept of CSR, a company must trend to : reduce the consumption of raw materials and energy, reduce production of hazardous waste and pollution, respect , protect and restore natural ecosystems identify potential negative environmental effects introduce mechanisms to internalize external environmental costs take into account environmental objectives at the stage of product design (eco-design, life cycle analysis ) implement technologies to reduce harm done to the environment in production processes promote ecological behavior within the company, as well as saving energy and water in every department of the company

29. CSR models

30. Models of corporate social responsibility  Friedman model  Ackerman Model  Carroll Model  Environmental Integrity & Community Model.  Corporate Citizenship Model.  Stockholders & Stakeholders Model.  New Model of CSR.

31. Friedman Model(1962-73)  A businessmen should perform his duty well, he is performing a social as well as a moral duty.  A businessmen has no other social responsibility to perform except to serve his shareholders & stockholders.

32. Ackerman Model (1976) The model has emphasized on the internal policy goals & their relation to the CSR.  Four stages involved in CSR.  Managers of the company get to know the most common social problem & then express a willingness to take a particular project which will solve some social problems.  Intensive study of the problem by hiring experts & getting their suggestions to make it operational.  Managers take up the project actively & work hard .  Evaluating of the project by addressing the issues.

33. Six Strategies in the adoption of CSR.  Rejection strategy  Adversary strategy  Resistance strategy  Compliance strategy  Accommodation strategy  Proactive strategy

34. Carroll's CSR Pyramid Carroll's CSR Pyramid is a simple framework that helps argue how and why organisations should meet their social responsibilities. The key features of Carroll's CSR Pyramid are that: CSR is built on the foundation of profit – profit must come first Then comes the need for a business to ensure it complies with all laws & regulations . Before a business considers its philanthropic options, it also needs to meet its ethical duties

35. Pyramid of CSR Carroll Model(1991)

36. Environmental Integrity & Community Health Model.  This model developed by Redman.  Many corporate in US adopted this model. Corporate contribution towards environmental integrity & human health, there will be greater expansion opportunities.  Healthy people can work more & earn more.  CSR is beneficial for the corporate sector.  CSR in a particular form is welcome.

37. Corporate Citizenship Model  To be a corporate citizen, a corporate firm has to satisfy four conditions:  Consistently satisfactory  Sustainable economic performance  Ethical actions  Behaviour .  A particular firm’s commitment to corporate citizenship requires the fulfillment of certain social responsibilty .

38. Stockholders & Stakeholders Model  Productvists believe that the only mission of a firm is to maximize the profit.  Philanthropists who entertain the stockholders. CSR is dominated by moral obligations & not self-interest.  Progressivists believes the corporate behaviour basically motivated by self interest & should have ability to transform the society for good.  Ethical Idealism concern with sharing of corporate profits for humanitarian activities.