Corporate Social Responsibility
Introduction
It is the primary aim of every organization to achieve its projected goals that are contained in its vision and mission. For business organizations, the ultimate goal is to make high profits. However, in the attainment of this goal, the interests of other stakeholders must also be put into consideration. Stakeholders in business organization vary but always include the customers and the general public. Corporate social responsibility (CSR), therefore, involves striking a balance between attainment of the projected goals of the company and meeting the interests of all other stakeholders (Soule, 2009). This discussion looks as the question of whether or not the success of a company in CSR is determined by the nature of products it deals with.
Companies of Choice
In order to properly explain the essence of CSR in the corporate world, two companies have been chose. The companies that will be used in this discussion include Transport for London and China Ocean Shipping Company. The CSR policy for both companies will be examined to establish to what extent they differ or are similar and the reason for the disparity or similarity. China Ocean Shipping Company specializes in the business of transport via sea. Transport for London is also a company that provides transport services. The company provides transport for the public in various parts of London.
Although both companies are in the transport business, the CSR policy for both companies varies. This is depending on the varying needs of each company. The main issues that are reflected in the CSR policy of Transport for London include environmental protection, suitable programmes, equality and charity. On the other hand, China Ocean Shipping Company (COSO) has its CSR policy embedded on the laws and regulations of China. Sustainability is one of the pillars upon which the CSR of the company is built. The policy also concentrates on integration and coordination of all the interests of the stakeholders. On the face of it, the CSR policy may seem different but they all trickle down to the same thing.
Potential Benefits of CSR
CSR has immense benefits on both the company and its stakeholder. To begins with CSR policies help to keep a company in check (Jonker, 2009). More often, if unchecked, companies can have excesses which are exploitative in nature. Having such a policy in place helps the company to remain tamed and to avoid the excesses. CSR also ensures that companies can give back to the society. Companies make their profits through the continuous support they receive from the community and society in which they operate (Coombs, 2011). As a morale booster to the community, it is paramount that companies continually give back to the society.
CSR also goes a long way in pushing up the sales of every business. Surveys conducted over time indicate that customers are more likely to continue purchasing products and services of a company that is involved in social responsibility (Idowu, 2008). Depending on the nature of the business conducted, CSR also plays a big role in environmental conservation. As aforementioned, CSR policies help to contain or keep in check the activities of organizations. For example, organizations that are engaged in manufacture of chemicals must ensure that before releasing the waste products into the environment, damage control is done. Damage control in this case will involve treating the waste so that it is not harmful to the environment.
Balancing costs and interest is yet another benefit of CSR. In doing so, the business must clearly and carefully identify its stakeholders. Stakeholders vary depending on each business. In this case, the stakeholders for both companies are pretty much similar because they are both in the transport business. Transport for London has managed to maintain its CSR by continually engaging all its stakeholders and bringing them on board. For the other company, the CSR policy has remained grounded mainly due to its relation with the laws of the country.
CSR and Corporate Objectives
Every business grapples with striking a balance between sticking to the CSR policy and achieving their corporate objectives. Corporate objectives refer to the specific goals that every organization hopes to achieve by the end of the year (Innes, 2007). Ordinarily the companies coin their CSR policies around their cooperate objectives (Horrigan, 2010). This means that the two are ideally supposed to component each other. However, in cases where the two clash, then CSR must always take precedence (Timothy, 2011). This is because corporate objectives can always be revised. Yet if the CSR does not take care of the needs of the stakeholders, the corporate objectives may fail.
Influences of CSR
There are a number of factors that influence the manner in which the CSR of any organization is coined. As already mentioned, CSR policies must be tied around corporate objectives (Crowther, 2008). Therefore, the products and or services of the business is key factor of influence. Secondly, the needs and interest of stakeholders also inform the CSR policy. For example, in this case, both companies are in the transport sector. The CSR policies of both organizations must reflect the divergent needs and interested of the stakeholders in the transport sector. These include the public who uses the transport services offered by the company among other stakeholders. This means that the particular product or service in which a company deals with directly affects how well a company is socially responsible.
Extent of Social Responsibility
In deciding the extent to which a company will be socially responsible, there are a number of factors that must be considered. The first is that the company should not go very far from the scope of its business (Aras, 2009). For example, in this case, both companies are in the transport business. It would therefore make sense if their CSR has direct relation to the core objectives of the company (Starr, 2013). In so doing, the company will not depart from its core business. A large departure from the core business may see a reduction in the concentration of the corporate objectives.
Another issue of consideration is the amount of funds channeled towards CSR. It must not take up a large percentage of the profits realized as this will nullify the whole essence of the existence of the business (Hawkins, 2009). Organizations must therefore strive to ensure that there is a proper balance in terms of the funds spent towards CSR (Visser, 2010). As a result, the amount of profits realized will have a direct bearing on the kind of CSR that organizations will be involved in.
Social Reporting
This refers to the general notion or perception held by the society and the larger world regarding an organization (Mares, 2008). Social reporting is extremely crucial to any organization. It helps establish the attitudes and beliefs held by the people in relation to the organization (Schwartz, 2011). For example, if the public and other stakeholders are not happy with the organization, social reporting will help identify the issues at hand. Both companies use social reporting to establish their standing the market. Every so often, both companies carry out a survey that rate the services offered. This is so as to establish the general attitude of the people.
Government Influence
The government also influences the manner in which organization carry out CSR. This is through the various regulations that have been put in place (Crane, 2008). Every business organization must ensure that there is compliance with the set rules and regulations of the sector (Mullerat, 2011). Some of the regulations go right at the heart of the CSR of each organization (Mallin, 2009). The freedom and autonomy to choose on the nature of CSR that an organization is involved in is greatly hampered by government regulations (Sim, 2013). For example, when the taxes levied against business organizations are high, the profit margins are reduced. This means that an organization has very little at its disposal for use in CSR.
Conclusion
Corporate Social Responsibility is a crucial aspect of operation in very organization. It is important that an organization strikes a balance between the corporate goals and objectives and the interests of the stakeholders. The stakeholders form the foundation of very organization. It is for that reason that their interest must be taken care of as they also influence the success of the organization. There are many factors of consideration when negating in CSR. All the crucial factors must be carefully considered. This is to ensure that the organization achieves its goals while remains socially responsible.
References
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Hawkins, D. (2009). Corporate social responsibility: balancing tomorrow’s sustainability. New York: Taylor and Francis
Horrigan, B. (2010). Corporate social responsibility in the 21st century. California: Edward Elgar Publishing.
Idowu, S. (2008). Global practices of corporate social responsibility. New Jersey: Springer.
Innes, J. (2007). Corporate social responsibility: a case study guide for management accountants. London: Sage.
Jonker, J. (2009). Management models for corporate social responsibility. New Jersey: Springer
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Mares, R. (2008). The dynamics of corporate social responsibility. New York: Prentice Hall
Mullerat, R. (2011). Corporate social responsibility: the corporate governance of 21st century. London: Sage
Schwartz, M. (2011). Corporate social responsibility: an ethical approach. New York: Broadview Press.
Sim, R. (2013). Ethics and corporate social responsibility: why giants fall. London: Greenwood Publishing Group
Soule,S. (2009). Contention and corporate social responsibility. New York: Cambridge University Press.
Starr, F. (2013). Corporate social responsibility for cultural heritage. New York: Prentice Hall.
Timothy, W. (2011). Managing corporate social responsibility. London: Sage
Visser. W. (2010). The A to Z of corporate social responsibility. London: John Wiley & Sons
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