Technology and Business: Corporate Social Responsibility Essay Example
In the last twenty years, a vast number of changes have taken place in relationships maintained by a company with the state and society. No longer does a company continue to act as Independent entity regardless of the public Interest and welfare of the society and TTS effect on the environment. The growth of the relationship between a company and the society has been a slow transformation from Just a humanitarian coexistence to a point where the Interest of stakeholders and society Is Increasingly becoming of prime importance. Organizations are beginning to realize the fact that in order to stay ahead in the business and gain strategic benefits, it is important to practice responsible business etiquette's.
The kind of competition companies' face today and the wave of globalization have drastically changed the business environment in...
the past few years. Globalization has compelled organizations to expand their boundaries from their country of origin to other rapidly developing markets In other parts of the world. In order to be successful in their attempt towards globalization companies have realized that they need to implement clearly defined business practices with a well-defined focus on public Interests and the environment.
Also, In some of the markets across the world, since the government still holds the key due to the rules and regulations set by it, the government would be naturally inclined to prefer companies which take care of the Interest of all the stakeholders. Lastly. Organizations across the world have begun to realize the importance of intangible assets, I. E. Be it brand name or employee morale. Only organizations that have gained the goodwill of the people and ar
Ideal corporate citizens will be successful in developing these assets into strategic benefits.
Social Responsibility is defined as, "The obligation of an organization's management towards the welfare and interest of the society which provides it the environment and resources to survive and flourish. And which Is affected by the organizations actions and policies. A Socially Responsible organization also focuses on protecting and improving society and the resources it uses rather than on solely making profits.
It Is from Social Responsibility that the term Corporate Social Responsibility originated. Defining Corporate Social Responsibility The World Business Council for Sustainable Development defines CARS as follows: "Corporate Social Responsibility is economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large". (Making Good Business Sense, L. Holmes & R. Watts).
The CARS definition used by Business for Social Responsibility is: Operating a business in a manner that meets or exceeds the ethical, legal, commercial and public expectations that society has of business. The European Commission supports two definitions wrapped into one: "A concept whereby companies decide voluntarily to contribute to a better society and a cleaner environment, & a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis".
Different perceptions of CARS are made across the world, across efferent societies: "CARS is about capacity building for sustainable livelihoods. It respects cultural differences and finds the business opportunities in building the skills of employees, the community and the government" from Ghana to "CARS is about business giving back to society" from the
Philippines. (Making Good Business Sense, L. Holmes & R. Watts).
At the core they all point towards the same fundamental principle - a company is responsible for providing more benefits to all stakeholders than Just profits for shareholders. It has a role to play in treating its employees well, reserving the environment, developing a sound corporate governance, supporting philanthropy, fostering 109 human rights, respecting cultural differences and helping to promote fair trade, among others. All are meant to have a positive impact on the communities, cultures, societies and environments in which companies operate.
These efforts should also benefit a company's various stakeholders, who comprise all or some of the following: customers, employees, executives, non-executive board members, investors, lenders, vendors, suppliers, governments, Nags, local communities, environmentalists, hearties, indigenous people, foundations, religious groups and cultural organizations. Socially responsible companies can act in a number of ways to benefit society, be it by giving money to the arts, funding academic scholarships, supporting community-building initiatives, and so on.
The contribution of companies can, however, go beyond charitable works by providing mechanisms for addressing root causes, with a view on the long-term. CARS is closely linked with the principles of Sustainable Development, which argues that enterprises should make decisions based not only on financial factors such as profits or dividends, but also based on the immediate and long-term social and environmental consequences of their activities. The Triple Bottom Line - TAB (or) ABLE: Known as People, Planet, Profit or The Three Pillars, is a criteria used for measuring organizational and societal success.
This has become a dominant approach towards implementing and measuring CARS. On reviewing each of these definitions we
see that in general CARS can be viewed as: 0 A concept or a mechanism by which businesses consider it their responsibility to including the welfare of its employees and their families and also the community at large. 0 It is a mechanism by which a company responsibly embraces its duties awards the environment, consumers, employees, communities and its stakeholders rather than solely concentrating on making profits and its own welfare regardless of public interest.
CARS also incorporates doing business ethically and responsibly I. E. Ethical behavior of and towards the staff, ethical business practices and transparency in corporate dealings. Hence, CARS can also be termed as the deliberate inclusion of public interest in corporate decision making. Therefore, to summarize, CARS can be considered as the impact of the company's actions on the society as a whole. From he management point of view, it becomes a manager's duty to overlook whether the actions performed by his organization are socially responsible.
Corporate Social Responsibility (CARS) is also termed as Corporate Citizenship, Global Citizenship and Corporate Accountability. History of Corporate Social Responsibility The term "Corporate Social Responsibility' originated in 1953 with the publication of Bone's Social Responsibility. The growth of CARS is as old as trade and business. Industrialization and impact of business on society and environment has added to the development of CARS. By ass's and ass's CARS was undertaken for discussion academically.
The first company to employ CARS into practice was Shell in 1998. 1990 saw CARS as a standard with companies like Price Waterholes Cooper and KEMP taking it under their wing. CARS has evolved beyond code of conduct and nowadays, with well informed
employees and stakeholders, CARS can be a threat to the development of a company. What Drives a Company towards Practicing CARS? As quoted by Peter Ducker, "The 21st century will be the century of the Social Sector Organization. The more economy, money and information become global, the more the community will matter.
A global survey conducted by The Economic Intelligence Unit found out that 85% of senior executives and institutional investors believe that CARS is an important consideration in decision making, indicating that CARS has been accepted even without a clearly defined business case. 0 The community demanding greater involvement and contributions due to the perceived shrinking of Nags. 0 Customers are increasingly demanding safe products and ethical businesses and are willing to alter their purchasing habits due to the same. 0 Stakeholders and shareholders are looking towards better risk and reputation management to protect true profits. Employees seeking great empowerment, more Job-security, better work-life balance and a sense of meaning in their work.
The challenges faced by organizations these days in one or more of the above mentioned areas has driven them towards seeking an integrated approach to battle these concerns. Till date companies have managed by interpreting CARS as external community relations and treated it accordingly, but this isn't enough anymore. This 110 approach misses out the fact CARS also extends to a company's products and services. Products and providing unethical services.
Hence implementing CARS is an all over exercise that needs to be practiced with great care and caution. CARS is important because businesses are based on trust and foresight. Establishing and keeping trust with customers, communities and regulators isn't simple and
can be easily damaged or lost. To be successful in the long-term, companies need to think beyond what's affecting them today to what's going to happen tomorrow. This isn't Just about addressing changes to technology or the needs of customers, but also taking into account alterations in social, environmental and governance issues.
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