Explain the concept of corporate social responsibility
Defining the concept
The term CSR was first coined in 1953 following the publication of the article, ‘Social Responsibility of Businessmen’ by Bowen (1953). The article sought to establish the responsibility of businesspeople to the society.
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This definition was later expanded by authors on the subject in the 1960s suggesting that organizations were responsible to the society in other ways, other than through legal obligations only (Carrol 2000). Academic discussions on the concept registered tremendous growth in the 1970s and 80s, but the first publications of a social report occurred in 1989. Shell was the first company to publish a CSR report (Marlin & Marlin 2003).
The European Commission defines Corporate Social Responsibility as “ …a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis.” (European Commission Green Paper 2000). CSR entails the principles upheld by companies in an attempt to leave a positive impact to the society.
As such, CSR involves the management of the ‘triple bottom line’, that is the environmental, economic and social impacts of an organization. It is the company’s attempt to remain responsive to the needs of its shareholders and to behave in accordance with certain values that may not necessarily be codified in law (World Business Council on Sustainable Development 2000).
In practical terms, CSR involves various actions taken by organisations, such as a reduction of carbon emission, or donating to charity. CSR impacts on the actions of an organisation with regard to the society living near its location, employee relations at the workplace, customer relations, supply chain management, sustainable development, and environmental concerns.
Some of the activities undertaken by organisations in the name of corporate social responsibility include codes of conduct, corporate philanthropy, community investment, and social and environmental reporting, among others.
What expert commentators are saying about the importance of corporate social responsibility?
Business leaders and entrepreneurs alike are now committed to ensuring that their organisations embrace the concept of corporate social responsibility in their business operations. At Co-op Adriatica, the largest retailer in Italy, Walter Dondi, the director of the company argues that their consumers are quite sensitive to environmental and social issues (InterPraxis 2004, para. 3). For this reason, the company has for the last 10 years deemed it appropriate to involve them in these issues.
As a result, consumers are now very aware of these issues. Mr. Dondi further adds that consumers especially ask request for information on workers’ rights, environmental policies, and product safety. Niall Fitzerald, whose is Unilever’s former CEO, argues that companies embrace CSR not because they have been forced to, but because it is the right thing to do for the success of business.
Jeroen van der Veer is a committee member of the managing directors at Shell and according to him if a company wishes to remain successful in the future then it has to integrate employees’ personal values and business (InterPraxis 2004, para. 5). This is because people are more inclined to do their best when they work at a company that values their contributions, contributes to the society, values opinions, and where their actions count.
Similar sentiments have also been echoed by the Chairman of Centrica PLC, Sir Michael Perry, who argues that brands that may hope to attain global recognition in the days to come are those embrace social change. Courtney Pratt is Toronto Hydro’s former CEO and according to him, businesses should not just be responsible to their main shareholders (InterPraxis 2004, para. 6). These are their employees, customers, government, and NGOs. They should also bear responsibility to the communities around their area of operation.
Why more companies are taking this responsibility more seriously
Companies are increasingly embracing the concept of CSR because they would want retain consumer and staff loyalty, their reputation, and at the same time maintain public goodwill. Companies are now taking CSR more seriously in order to manage their reputation. An increasingly large number of companies are now trading on their brand value, reputation, and intellectual property, as opposed to products and services (Carroll 1999, p. 269).
Companies that wish to retain their reputations often see CSR as an essential strategy. CSR also enables companies to manage their risks. Investing in an organization is usually a gambling affair and for this reason, investors desire to see an organisation as more of a safe bet. By embracing the CSR concept, organisations are likely to become more aware of some of the issues that may cause them to be put on the spotlight by campaigners.
Employees would also want to be associated with a company that appears to value their input (European Commission Green Paper 2000). A social responsible company in the eyes of employees may lead to employee satisfaction, with high retention incidences. Investing in CSR enables a company to remain competitive in the market. Thus, companies embrace CSR as a strategy to position themselves competitively in the market.
Companies want to be associated with ethics and for this reason some companies have for example embraced green technology in their operations because it is the ethical thing to do. Such companies are morel likely to remain popular with their customer, compared to their competitors. CSR enables companies to save money and as such, it enables organisations to increase their operational efficiency.
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Such environmental measures as saving of energy or minimising of waste could also result in reduced operational costs (World Business Council on Sustainable Development 2000). Companies tend to prioritise such measures (Marlin & Marlin 2003). However, they still have to be careful because in as much as it is important to protect the environment, companies need to make profits too.
There is widespread mistrust among corporations, even after they have been granted power by the society. Cases of stress at the workplace are on the increase, employees are working harder than ever, and there is greater job insecurity. For fear of losing their operational licenses, companies have now sought to embrace CSR in an attempt to convince members of the society that indeed, they can still impact positively on the society.
Corporate responsibility at Singapore Airlines
At most organisations, the issue of corporate social responsibility entails mainly giving back to the community within the physical location of the company. However, at Singapore Airlines, this is not the case. The airline acts as a global citizen to the local community as much as it does to the international community. For example, following the unprecedented several flooding that affected residents of Queensland, Australia, Singapore Airlines set aside A $ 100,000 to assist in rebuilding and recovery efforts.
In the same way, the airline also set aside $ 415, 300 for the victims of the Mach 11th tsunami and earthquake victims in Japan (Singapore Airlines 2011). This money was meant to assist in recovery and relief efforts for the victims. Since 2003, Singapore Airlines has been supporting Bantay Bata 163, a child welfare programme in the Philippines.
This is a rescue centre that provides care, shelter and rehabilitative efforts to abused and sick children. The airline caters for the elementary education of thee rescued children. Singapore Airlines has also partnered with a number of hospitals in Japan whereby during Christmas, the children at these hospitals gets presents form the airline staff.
At Singapore Airline, corporate social responsibility is a tool to leverage the company’s expertise in air transportation services. Other than just contributing to organizations and charities within Singapore, the airline ahs also recognized the importance of establishing strong relationships with the various communities and countries it serves. This is a true mark of global corporate citizen. By supporting the community both locally and abroad, Singapore Airlines hopes to become a good corporate citizen (Singapore Airlines 2011).
One of the corporate initiatives that the airline has made is in the area of community welfare. The airline supports various local and overseas charity organisations and community groups through sponsorship and corporate donations. Singapore Airlines also supports a number of community projects. A case in point is the Australian social workers whom the airline provided with air travel to Dhaka, Bangladesh.
The social workers were on a project that targeted textile workers with the aim of preventing hearing loss among these workers. Singapore Airlines has for a long time now supported the arts community in Singapore. In this case, the airline contributes to the Singapore Dance Theatre, Singapore Chinese Orchestra, Singapore Lyric Opera, and Singapore Symphony Orchestra (Singapore Airlines 2011).
In terms of education, Singapore Airlines contributes to various events and programmes. Through these programs, many disadvantaged students get a rare chance to realize their full potential, academically. Still in the education sector, Singapore Airlines has offered air ticket rebates to Singapore Sports Scholl, a newly established institution that nurtures upcoming sporting talents (Singapore Airlines 2011).
The airline also supports scholarship programmes in the community, such as Thailand’s Smiling Together project, and the Philippines-based Bantay Edkasyon project.
In terms of the environment, Singapore Airlines is committed to supporting projects that impact positively on the environment. As such, the airline has so far implemented various initiatives to reduce carbon emission and fuel consumption.
They include the engineering performance and maintenance, enhancement of flight operations, and weight saving measures. The airline set aside US $ 3 million in August 2010, to go towards a groundbreaking exercise for building a 100,000 hectares conservancy. The Harapan Rainforest Initiative is aimed at protecting one of the most diverse rainforests globally.
In addition, it will also aid in curbing deforestation and in the process, help to combat climate change (Singapore Airlines, 2011). The airline is also committed to the maintenance of modern and young fleets. By adopting novel technologies, the airlines hopes to harness the benefits of improved fuel productivity, reduced greenhouse gas emissions, efficient utilization of resources, and reduced noise levels (Singapore Airlines, 2011).
Bowen, H. R., 1953, Social Responsibilities of the Businessman. New York: Harper & Row.
Carroll, A., 1999. Corporate Social Responsibility, Evolution of a Definitional Construct. Business & Society, Vol. 38 No. 3, pp. 268-295.
European Commission Green Paper., 2000. Promoting a European Framework for Corporate Social Responsibility. Web.
InterPraxis., 2004. Quotations from Business and Thought Leaders on Ethics and CSR. Web.
Marlin, A., & Marlin, J. T.. 2003. A brief history of social reporting. Business Respect No 51 – Web.
Singapore Airlines., 2011. Singapore Airlines & Corporate Responsibility. Web.
Singapore Airlines., 2011. Singapore Airlines Annual Report. Web.
World Business Council on Sustainable Development., 2000. Corporate Social Responsibility: Making Good Business Sense. Web.