A Brief Definition of Corporate Social ResponsibilitySocial responsibility is the duty of organizations and individuals to act in ways that benefit society and/or the environment. Show
Learning Objectives Examine how social responsibility helps to sustain the equilibrium between economic development and the welfare of society and the environment Key TakeawaysKey Points
Key Terms
A tradeoff always exists between material economic development and the welfare of society and the environment. Social responsibility is the idea that an
organization or individual is obligated to act to benefit society at large—i.e., to maintain equilibrium between the economy and the ecosystem.  The Value of CSR: This diagram shows the various ways that a company can invest in being socially responsible and the value those actions can bring to the company. The Conference Board of Canada, a not-for-profit organization that specializes in economic trends, suggests that social responsibility is a way of conducting business through balancing the long-term objectives, decision-making, and behavior of a company with the values, norms, and expectations of society. Social responsibility can be a normative principle and a soft law principle engaged in promoting universal ethical standards in
relationship to private and public corporations. Early Efforts in Social ResponsibilitySocial responsibility is the idea that an entity needs to act in a way that balances its own gain with societal benefits.
Learning Objectives Recognize Andrew Carnegie's business principles of charity and stewardship as the precursors to modern organizational social responsibility Key TakeawaysKey Points
Key Terms
Social responsibility is the idea that an entity needs to act in a way that balances its own gain with societal benefits. Entities include individuals as well as businesses. Companies do need to make a profit, but not at the expense of society or the environment. Businesses should use ethical decision-making practices to make responsible decisions and reduce the need for government involvement such as, for example, Environmental Protection Agency (EPA), which monitors business decisions and practices to prevent pollution. Oil Spill: Oil spills and other environmental disasters show the need for social responsibility. The notion of social responsibility is far from new. Its roots are in economics and the writings of Andrew Carnegie (1835-1919), a Scottish-born businessman and founder of U.S. Steel. Carnegie's business philosophy was based on two principles: charity (the more fortunate should assist those who are less fortunate) and stewardship (the rich hold their money "in trust" for
the rest of society, using it for any purpose society deems appropriate). Modern Trends in Social ResponsibilitySocially responsible trends include corporate citizenship policies, social investing, sustainable accounting & social entrepreneurship. Learning Objectives Explain how the advent of
socially responsible investing, sustainability accounting, and social entrepreneurship has contributed to the modernization of social responsibility Key TakeawaysKey Points
Key Terms
Corporate Social Responsibility Corporate social responsibility (abbreviated CSR; also called corporate conscience, corporate citizenship, social performance, or sustainable responsible business) is a form of self-regulation integrated into a business model. A socially responsible business monitors and ensures its active compliance with the spirit of the law,
ethical standards, and international norms. The goal of CSR is for a company to take accountability for its actions and achieve and encourage a positive impact on the environment as well as its consumers, employees, communities, and other stakeholders. The United Nations: The UN has developed the Principles for Responsible Investment as guidelines for investing entities. Socially Responsible InvestingSocially responsible investing is the practice of investing funds only in companies deemed to be socially responsible according to a given set of criteria. It is a booming market in both the US and Europe. As of 2010, nearly one out of every eight dollars under professional management in the US is involved in socially responsible investing; this is 12.5% of the $25.2 trillion in total assets under management tracked by Thomson Reuters Nelson. Sustainability Accounting Sustainability accounting has increased in popularity over the past few decades. Many companies are adopting new methods and techniques in
their financial disclosures that provide information about their core activities and their impact on the environment. As a result of this action, stakeholders, suppliers, and governmental institutions have a better understanding of how companies manage their resources to achieve sustainable development. Social Entrepreneurship Social entrepreneurship is the recognition of a social problem and the use of entrepreneurial principles to organize, create, and manage a social venture to achieve social change. While a business entrepreneur typically measures performance in profit and return, a social entrepreneur also cares about positive social, cultural, and
environmental progress. Social entrepreneurs are commonly associated with the voluntary and not-for-profit sectors, but this doesn't necessarily mean they don't make a profit. Stakeholders: Consumers, Employees, and ShareholdersStakeholders may have different interests related to the pursuit of profit and social impact. Learning Objectives Identify the
importance of an organization recognizing the needs of its stakeholders Key TakeawaysKey Points
Key Terms
Increasingly, corporations are motivated to become more socially responsible because their most important stakeholders expect them to understand and address the social and community issues that are relevant to them. Understanding what causes are important to employees is usually the first priority because of the many interrelated business benefits that can be derived from increased employee engagement (i.e. loyalty, improved recruitment, increased retention, higher productivity, and so on). Key external stakeholders include customers, consumers, investors (particularly institutional investors), communities in the areas where the corporation operates its facilities, regulators, academics, and the media. Various Types of Stakeholders: This image shows the various internal and external stakeholders. Branco and Rodrigues (2007) describe the stakeholder perspective of CSR (corporate social responsibility) as the inclusion of all groups or constituents (rather than just shareholders ) in managerial decision making related to the organization's portfolio of socially responsible activities. This normative model implies that the CSR collaborations are positively accepted when they are in the interests of stakeholders and may have no effect or be detrimental to the organization if they are not directly related to stakeholder interests. The stakeholder perspective suffers from a wheel and spoke network metaphor that does not acknowledge the complexity of network interactions that can occur in cross-sector partnerships. It also relegates communication to a maintenance function, similar to the exchange perspective. Stakeholder and Other Theories Whether it is a team, small group, or a large international entity, the ability
for any organization to reason, act rationally, and respond ethically is paramount. Leadership must have the ability to recognize the needs of its members (or called "stakeholders" in some theories or models), especially the very basics of a person's desire to belong and fit into the organization. It is the stakeholder theory that implies that all stakeholders (or individuals) must be treated equally regardless of the fact that some people will obviously contribute more than others to an
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What is corporate social responsibility and why is it important?What is Corporate Social Responsibility (CSR)? Corporate Social Responsibility means that a company takes steps to ensure there are positive social and environmental effects associated with the way the business operates.
What is the best definition for the term corporate social responsibility?Corporate Social Responsibility (CSR) is the idea that a company should play a positive role in the community and consider the environmental and social impact of business decisions.
Which responsibilities does a company need to have to be socially responsible quizlet?Social responsibility means that an organization tries to be responsible to society, even if that may mean reducing profits. Examples are fair employment practices, helping with urban renewal and development, working with educational institutions, and limiting pollution. You just studied 29 terms!
What is social responsibility quizlet?Social Responsibility: A business's obligation to pursue policies, make decisions, and take actions that benefit society.
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The key to success in developing an excellent corporate social responsibility activity is ______.
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