Corporate Social Responsibility Essay

The contemporary business culture has continued to evolve and to support the role of
the organization in providing better public relations. Every firm is faced with the
responsibility of giving back to society. This realization has led to the molding of
organizational practices and norms so as to attain the status of an ethical and authentic body
which prioritizes public welfare as opposed to the traditional profit-making organization
whose only aim is to minimize costs and maximize profits (Blombäck & Wigren2009).
Corporate social responsibility (CSR), usually defined as the corporate initiatives and
discretionary organizational practices based on the commitment which is meant to instill
well-being to the society (Claydon, 2011). The practices can be charitable events, Corporate Social Responsibility Essay.
environmental sustainability, buying from local suppliers, providing employment to locals
among others. According to Dina (2014), initially, strategic management was meant to lead
an organization towards the reduction of costs to gain a charge initiated competitive
advantage and experienced a moral dilemma since they did not understand the value of
engaging in corporate social responsibility. In light of the need for continued development
and internationalization, the vital role of having a culture of corporate social responsibility is
evident based on the effects of the business practice both positively and negatively.
Importance of CSR
Morality in business is about managers responding to the call of obligation without
particular regard to profit maximizing. The practice of corporate social responsibility poses a
moral dilemma to many managers since firms assume they gain nothing from engaging in the
practice (Tata & Prasad, 2015). The stakeholder theory by Freeman states that managers are
responsible for ensuring maximum organizational behavior and also provide a good balance
Corporate Social Responsibility 3
of relations with the outside world. However, some benefits accrue to firms that value such
ethical practices.

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The most common benefit is that companies improve the perspective of customers
towards the business since the method involve customer engagement and the fact that it is all
about adding value to society and creating a positive impact on the community (Tseng 2010). Corporate Social Responsibility Essay.
This practice is one of the initiatives used by companies like the coca-cola and Pepsi for
product differentiation and customer engagement. The move is believed to make a business
unique to its clients thus facilitating customer loyalty which is one of the vital ingredients of
sustainable competitive advantage (Blombäck & Wigren2009).
Apart from customer engagement, there is also the employee engagement whereby a
team of employees is chosen to formulate a good plan for CSR and implement the plan
(Claydon, 2011). The process may involve extensive training programs of interpersonal skills
and development that make the employees motivated .one of the forms of CSR is to engage
in charitable activities, and this requires exceptional interpersonal skills. When employees are
motivated, the outcome will not only be a viable strategy for CSR but also increased
productivity (Tata & Prasad, 2015).
CSR creates a culture of long-term strategic planning and decision making since it
depicts the impacts of business decisions on the firm’s future and is based on ensuring
sustainability. A subset of long-term thinking is innovation and inventions (Dina, 2014).
These developments are a perceived benefit of CSR, as much as companies want to improve
their social image and impact they are inclined to do so at the lowest possible costs.
According to Srichatsuwan (2014), costs are the main reason why CSR creates a moral
dilemma for managers. This price increase triggers the need for innovative methods which
can reduce the cost of engaging in CSR and having more gain than loss. According to Du,
Bhattacharya & Sen (2015), the bottom line theory, CSR enhances sustainability in three
Corporate Social Responsibility 4
forms, environmental, social and economical. According to Blombäck & Wigren,(2009), CSR
ensures that companies don’t experience an ethical blow back like in the case of Tesco some
few years ago whereby the company experienced poor services and excessive transactional
costs due to poor relations with their environment that provoked hostility among their
suppliers and customers. Corporate Social Responsibility Essay.
CSR improves and enhances the corporate image of a company and thus increasing
customer loyalty since the company is thought of a reliable, responsible and kind. The
goodwill value is established (Du, Bhattacharya & Sen 2015). A good image makes a firm
avoid constant scrutiny from regulatory bodies laying a good foundation for the attraction of
capital inflow and investment. Initiatives of CSR involve environmental sustainability which
ensures a clean and safe environment and reduces the adverse effects of globalization
(Claydon, 2011).
Disadvantages of CSR
The main demerit of the practice is that the companies cause towards profit
maximization are altered yet there is not a guarantee that there will be increased goodwill
value. The method enhances the cost of production and reduces chances the chances of
achieving cost driven sustainable advantage (Du, Bhattacharya & Sen 2015). Initiatives such
a disclosing the significant disadvantages of consuming a companies’ products reduce the
customer base and thus may cause reduced profits margins (Dina, 2014). Sometimes
customers may want to see the results of business engagement and if they are not immediate
then they may dismiss the CSR initiatives as scams to win their loyalty and therefore a
company will not have achieved their intended purpose with disinterested customers.
Conclusion
According to Srichatsuwan (2014), the business world of today calls for a more
responsible and accountable form of management, who not only organize the internal
Corporate Social Responsibility 5
environment of business but also to the business environment. Engaging in CSR enhances the
reputation of a company and even goes ahead to increase the goodwill value and on the other
hand ensures a better world (Du, Bhattacharya & Sen 2015). It is normal to be confused as to
whether corporate social responsibility is vital for organizational performance and also
consider facts such as increased costs of production with no immediate positive returns to
investment. However, the long-term benefits hold more weight and: therefore, managers are
encouraged to initiate such value adding practices to their companies. Corporate Social Responsibility Essay.
Corporate Social Responsibility 6
References
Blombäck, A. & Wigren, C. 2009, “Challenging the importance of size as determinant for
CSR activities”, Management of Environmental Quality, vol. 20, no. 3, pp. 255-270.
Claydon, J. 2011, “A new direction for CSR: the shortcomings of previous CSR models and
the rationale for a new model”, Social Responsibility Journal, vol. 7, no. 3, pp. 405-420.
Dina, e.K. 2014, Corporate Social Responsibility supporting SMEs: Lessons Learned from
Egypt, Federal Reserve Bank of St Louis, St. Louis.
Du, S., Bhattacharya, C.B. & Sen, S. 2015, “Corporate Social Responsibility, Multi-faceted
Job-Products, and Employee Outcomes”, Journal of Business Ethics, vol. 131, no. 2, pp.
319-335.
Srichatsuwan, S. 2014, Corporate social responsibility and performance: A study of small
businesses in the United States, Alliant International University.
Tata, J. & Prasad, S. 2015, “CSR Communication: An Impression Management Perspective”,
Journal of Business Ethics, vol. 132, no. 4, pp. 765-778.
Tseng, Y.F., Yen-Chun, J., Wu, W. & Chun-Yu, C. 2010, “Exploring corporate social
responsibility education”, Management Decision, vol. 48, no. 10, pp. 1514-1528.Corporate Social Responsibility Essay.