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The Current Corporate Social Responsibility’ State in the UAE Essay

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Updated: Jun 3rd, 2020

Introduction

If the subject relating to corporate social responsibility also abbreviated CSR is presently viewed in the Middle-East, it is noticeable that UAE shows up as a state which justifies close examination amid the entire Arab states. The reason being that in various other Arab nations within the region, CSR is apparently obtrusive but absent. However, while its growth seems to be very slow in the UAE, this nation is already acquainted with concept of corporate social responsibility. In fact, UAE engages in many activities and actions under the corporate social responsibility banner (Blowfield, Blowfield & Murray, 2008). A comprehensible hint of this actuality is that simply Qatar together with the United Arab Emirates in entire Arab humanities are held as the acme apparent states contributing to the actions which relate to corporate social responsibility. That is, amongst the administrators of the United Arab Emirates, the perception of the corporate social responsibility idea and the impact appended to it has given rise to the surfacing of an assortment of CSR actions when matched to auxiliary nations in the Arab world.

UAE Corporate Social Responsibility Activities/ Issues

In the UAE, the concept of CSR is not new to multinational corporations (MNCs) that operate in this country. The CSR conception is however new to locally operating companies. MNCs are well versed with the CSR activities given that they are engaged in the Western operations. A as a result MNCs import the adopted corporate social responsibility practices from abroad. When compared to other regions of operations, it emanates that MNCs tend to substantially perform dismal corporate social responsibility related actions in the UAE (Zorzopulos, 2006, p.9).

Even though multinational corporations tend to be rather actively engaged in the corporate social responsibility issues when compared to the local based corporations, MNCs have basically adapted to the local expectations and conditions. Thus, the kind of corporate social responsibility activities that are performed by local corporations differ slightly from those that MNCs perform. In the UAE, the most commonly observed CSR activities include emiratization and philanthropy. Employees’ safety and health as well as environmental concerns are equally gaining much attention. According to Emirates Environmental Group (2008) report, local based corporations tend to concentrate more on the emiratization and corporate philanthropy which entails efforts geared towards bringing the public into the labour force. MNCs on the other hand have long standing better records relating to their engagements with safety and health as well as environmental issues. This paper is entirely concerned with the issue of emiratization.

Emiratization

From the research studies literature, the phrase emiratization entails any national efforts intended to prepare and educate the young Emiratis so that they can be well acquainted with workplaces as well as to secure the available employment opportunities for them. The UAE citizens are very youthful individuals with approximately 45.0% of them being under the age of fifteen years. Besides, according to the Emirates Environmental Group (2008) report, 9.0% of men and 20.0% of women are in employment. Despite this, it is worth noting that the Emiratis usually lack the incentives for taking up the available employment opportunities since most of them come from the wealthy and elite families. Moreover, Emiratis are sort of the abilities requisite to adequately compete with the relatively cheap and skilled expatriate workforces.

In essence, CSR activities associated with corporate emiratization are both compulsory and voluntary. In the United Arabs Emirates, voluntary activities are deemed to be educational to aptly prepare the Emiratis to be equipped with workplace skills and knowledge. For instance, a locally established semi-private investment corporation dubbed as Mubadala undertakes the responsibilities of managing diverse portfolios. This corporation generously donates to three renowned foundations which it had initially assisted in setting up. Amongst them is the famous Tawteen which works to spearhead and foster career guidance and education (Khan, 2009).

Conversely, in the Emirates Environmental Group (2008, p.24) report, the Dubai international financial center claims that its main focus in the area of corporate social responsibility appertains to empowering and educating individuals and groups with special needs. The main aim is to put up sustainable workforces that are skilled based within the UAE environs. Similarly, multinational corporations such as ABB Company and Shell Corporation significantly contribute to the issue of emiratization. Shell Corporation for instance, instituted a program known as Intilaaqah with the intention of promoting business skills and entrepreneurship. ABB Company in contrast established mentorship and educational program that was meant to nurture talents as well as build capacities (Emirates Environment Group, 2008).

Ibrahim and Sherif (2009) claim that emiratization correlates to the issue of corporate philanthropy given that most donations (Zakat) are frequently drawn on when sponsoring the work or employment training programs. All these examples constitute voluntary initiatives examples which are intended to link up the corporations’ needs with the Emiratis skills development.

Nevertheless, there are equally considerable compulsory elements to the issue of emiratization which relates to securing employment opportunities for the Emiratis. The government of UAE normally issue emiratization targets for various corporations and industries alike. The targets necessitate that a given fraction of the nationals should be employed by the companies. The target in the trading industries is just applicable to corporations employing above fifty employees. From Ibrahim and Sherif (2009) claims, it is clear that in the insurance industry, the government laid target for employing the UAE nationals is 15.0% while in the trading and banking industries, the target is to augment the proportion of nationals employed by about 2.0% and 4.0% annually correspondingly.

Any corporation that is found in the UAE which fails to meet such employment targets are bound to be penalized. The penalties include the imposition of fines on the corporations that violates the instituted emiratization issue. Nonetheless, the efficiency and success of this quota system has often been questioned. For instance, there are corporations in the UAE that hire ghost workers who are UAE nationals simply to accomplish the obligatory quota (Cone, 2003). These corporations hardly require such workers to show up for the works or necessarily do any real jobs in the companies.

The current CSR state in the UAE

There are quite a number of influential factors explaining the current state of CSR in the UAE. The most notable influences accrue in form of family governance of the firms, government, religion as well as the civil society. Irrespective of all the influences, religion is seen to contribute to the corporate philanthropy since corporate leaders and managers are inclined to fulfilling the Zakat duty. Conversely, the government is seen to play a significant role in spearheading and promoting CSR activities in the UAE. In fact, the UAE government is actively involved in activities that further the citizens (Emiratis) welfare. The rulers do not only ensure that personal incomes are not taxed, but they similarly give out facilities including money and land to the Emiratis (Soubra, 2006, p.33).

Managers in the UAE believe that their government ought to be actively involved in spearheading CSR activities. This gives congruence between the government involvement and the attitudes of the partaking managers. The government of Abu Dhabi for instance has incentives, laws and policies that are meant to bolster the social welfare of the Emirate. The direct UAE government involvement materializes to set the lawfully imposed quotas in different industries that in turn enhance emiratization. The social commitments that accrue in philanthropic donation form are part of the government’s plan intended to cater for the community interests and bolster sustainable social development (Soubra, 2006). While the UAE corporate social responsibility might strategically develop in the business direction as observed in the Western countries, this will hardly take place in the near future due to UAE’s deep religious and cultural underpinnings.

Conclusion

Each UAE government organizations have their own plans intended to spearhead the issue of emiratization. Basically, the concept of emiratization has helped to create an environment where many youthful nationals who step out colleges and universities might secure suitable work career opportunities. Emiratization further encourages hopeless UAE nationals to work hard in order to attain higher educational levels that will enable them to occupy key positions in the private and government organizations. Nevertheless, given the rate at which emiratization initiative succeeds together with the escalating rate of unemployed nationals, authentic tests tend to subsist as far as the issue of emiratization is concerned. Both the private and public organizations tend to look for ways of evading the stringent employment rules that the UAE government has put in place. This is seen partly in the hiring of the non existing ghost workers who are claimed to be Emiratis.

References

Blowfield, M, Blowfield, M & Murray, A 2008, Corporate responsibility: A critical introduction, Oxford University Press, UK.

Cone, M 2003, “The role of commercial organizations in Islamic society”, Journal of Corporate Citizenship, Emirates Environmental Group, 2008, Corporate social responsibility and the United Arabs Emirate, a way of life for tomorrow’s business: A perspective on corporate social responsibility in the Arabian Gulf. Web.

Ibrahim, B & Sherif, H 2009, From charity to change: Trends in Arab philanthropy, American University of Cairo Press, Cairo, Egypt.

Khan, A 2009, From Zakat to CSR: Corporate responsibility in the Middle East, Hill & Nolton, Moyock, NC.

Soubra, H 2006, An examination of the effects of cultural orientations and economical factors on CSR policy making in the UAE, Master Thesis, University of Strathclyde Business School.

Zorzopulos, S 2006, Corporate social responsibility in the United Arab Emirates: A preliminary assessment, Dubai Ethics Resource Center, June 2006.

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