8/9/2019 CSR Concept-2 2

1/16

Corporate Social Responsibility

8/9/2019 CSR Concept-2 2

2/16

Social Responsibility...

An organizations obligation to maximize

its positive impact on stakeholders and tominimize its negative impact

Includes legal, ethical, economic, and

philanthropic dimensions

8/9/2019 CSR Concept-2 2

3/16

Legal Dimension...

Refers to obeying governmental laws andregulations

Civil law: rights & duties of individuals andorganizations

Criminal law: prohibits specific actions andimposes fines and/or imprisonment as

punishment for breaking the law

8/9/2019 CSR Concept-2 2

4/16

Ethical Dimension...

Behaviors and activities that are expected or

prohibited by organizational members, the

community, and society (not codified intolaw)

Standards, norms, or expectations that

reflect the concern of major stakeholders

8/9/2019 CSR Concept-2 2

5/16

Economic Responsibilities...

How resources for the production of goods

and services are distributed within the social

system

Consumers favor socially responsible

companies not companies that maximize

profits.

8/9/2019 CSR Concept-2 2

6/16

Philanthropic Dimension...

Businesss contributions to society

Strategic philanthropy

8/9/2019 CSR Concept-2 2

7/16

Other Dimensions...

Social obligation

Social reaction

Social responsiveness

8/9/2019 CSR Concept-2 2

8/16

Foundation principles of

corporate social responsibility

Charity rinciple Stewardshiprinciple

Definition y Business should givevoluntary aid to

societys needy persons

and grou

ps

y Business, acting as a publictrustee, should consider the

interests of all who are

affectedb

ybu

sinessdecisions and policies

Type ofactivity

y Corporate philanthropy

y Voluntary actions topromote the social good

y Acknowledging business

and society interdependence

y Balancing the interests andneeds of many diversegroups in society

xamplesy

Corporate philanthropicfoundations

y Private initiatives tosolve social problems

y Social partnerships withneedy groups

y Enlightened self-interest

yMeeting legal requirements

y Stakeholder approach tocorporate strategic planning

8/9/2019 CSR Concept-2 2

9/16

The pros and cons of corporate

social responsibilityArguments for corporate

social responsibilityArguments against corporate

social responsibility

Balances corporate power

with responsibility.

Discourages government

regulation.

Promotes long-term profits

for business.

Responds to changing

stakeholders demands.

Corrects social problems

caused by business.

Lowers economic

efficiency and profit.

Imposes unequal costs

among competitors.

Imposes hidden costs passed on

to stakeholders.

Requires social skills business

may lack.

Places responsibility on business

rather than individuals.

8/9/2019 CSR Concept-2 2

10/16

The multiple responsibilities of business

Economic

esponsibility

Legal

esponsibility

ocial

esponsibility

8/9/2019 CSR Concept-2 2

11/16

Two views of corporate social

responsibility

The shareholder view

The only social responsibility of business is to create shareholder

wealth.

Corporate management cannot decide what is in the socialinterest.

The costs of social responsibility which do not increase the value

of stock, will be passed on to consumers.

The multiple stakeholders view

All customers and employees are treated with dignity.

Relationships with suppliers must be based on mutual trust.

Belief in fair economic competition.

Business can contribute to social reform and honor human rights.

8/9/2019 CSR Concept-2 2

12/16

Contrast between corporate social

responsibility, corporate socialresponsiveness, and corporate citizenship

orporate social

responsibility

orporate social

responsiveness

orporate citizenship

Origin 1920s 1960s 1990s

asis

Principles o

charity and

ste ardship

emands made by

numerous social

stakeholder groups

uilding collaborative

partnerships ith

stakeholder groups

Focus

Moral

obligations to

society at large

Practical responses by

businesses to

corporatestakeholders

iscovering business

opportunities through

partnerships

ction

Philanthropy,

trustee o the

publics

interests

ocial programs

Managing corporate

social and inancial

per ormance

8/9/2019 CSR Concept-2 2

13/16

Principles of corporate citizenship

Good corporate citizens strive to conduct all business dealings in an ethical

manner, make a concerned effort to balance the needs of all stakeholders,

while working to protect the environment.

1) Engages in fair and honest business practices in its relationship with stakeholders.

2) Sets high standards of behavior for all employees.

3) Exercises ethical oversight of the executive and board levels.

4) Strives to manage the company for the benefit of all stakeholders.

5) Initiates and engages in genuine dialogue with stakeholders.

6) Values and implements dialogue.7) osters a reciprocal relationship between the corporation and community.

8) Invests in the communities in which corporation operates.

9) Respects the rights of consumers.

8/9/2019 CSR Concept-2 2

14/16

Principles of corporate citizenship

10) Offers quality products and services.

11) Provides information that is truthful and useful.

12) Provides a family-friendly work environment.

13) Engages in responsible human-resource management.

14) Provides an equitable reward and wage system for employees.

15) Engages in open and flexible communication with employees.

16) Invests in employee development.

17) Strives for a competitive return on investment.18) Engages in fair trading practices with suppliers.

19) Demonstrates a commitment to the environment.

20) Demonstrates a commitment to sustainable development.

8/9/2019 CSR Concept-2 2

15/16

Social responsibility ofTISCO (as per

Mission)

1. Shareholders

i. By protecting and safeguarding their investment; and

ii. By ensuring to them fair return

2. Employees

i. By a realistic and general understanding and acceptance oftheir needs and rights and enlightened awareness of the social

responsibilities of industry;

ii. By providing adequate wages, good working conditions, job

security, effective machinery for speedy redressal of

grievances, and suitable opportunities for promotion and self-

development;

iii. By promoting feelings of trust and loyalty through a human

and purposeful awareness of their needs and aspiration; and

iv. By creating a sense of belongingness and team-spirit through

their closer association with management at various levels.

8/9/2019 CSR Concept-2 2

16/16

Social responsibility ofTISCO contd

3. Customersi. By products of proven quality at a fair price;

ii. By fulfilling its commitments impartially and courteously in

accordance with sound and straightforward business principles; and

iii. By bearing their counting confidence in its productive ability and itstechnical competence to keep improving the quality of its products.

4. Community

i. By respecting the dignity of the individual and acting according to the

ideas of social justice;

ii. By encouraging talent and promoting civic sense among members of

the community;

iii. By availing of opportunities to develop the democratic qualities

involved in collective work undertaken in the interest of the

community

iv. By assuming its proper share of social responsibilities in the

community in which the company operates