Corporate Social Responsibility – Merits and Demerits

The purpose of the business and corporate house is to earn profit, but it is the responsibility of corporate houses to return to the society. The concept of the CSR is not just philanthropy but it is more about proper management of the economy and resources. It is not just about what the company does with its profit but also how the money is made. If we closely observed that the CSR will show that it indirectly helps business in improving its image among people and provide a very good chance to connect with a large number of people.

The concept of corporate social responsibility is gaining importance and it has emerged as the latest technique to strive and sustain competitive advantage over competitors with moral management. The concept of CSR is not altogether new, it was present in corporate culture since years ago, but latest corporate heroes and policy makers has given it more importance.

The concept of corporate social responsibility is gaining popularity.  People like warren buffet and Bill Gates are strongly promoting CSR   and setting examples for others to follow.

One of the biggest challenges faced by businesses and corporate world is to follow sustainable, just and balance development. To meet the needs of current and future generations successfully it is essential to follow respect for international standards protecting core social and environmental values. This clearly emphasizes and recognizes the role of the business sector in the development of society. As part of the society it is the responsibility of business to address the common problems of the society. A business can flourish if only the communities around them are healthy and operate in a proper way.

The World Business Council for Sustainable Development has described CSR as the business contribution to sustainable economic development of the society

  • Corporate governance and ethics;
  • Health and safety;
  • Environmental leadership;
  • Human rights (including core labour rights);
  • Sustainable development;
  • Conditions of work (including safety and health, hours of work, wages);
  • Industrial relations;
  • Community involvement, development and investment;
  • Involvement of and respect for diverse cultures and disadvantaged people;
  • Corporate philanthropy and employee volunteering;
  • Customer satisfaction and adherence to principles of fair competition;
  • Anti-bribery and anti-corruption measures;
  • Accountability, transparency and performance reporting; and
  • Supplier relations, for both domestic and international supply chains.

“In the flat world, with lengthy global supply chains, the balance of power between global companies and the individual communities in which they operate is tilting more and more in favour of the companies. As such these companies are going to command more power, not only to create value but also to transmit values, than any other institution on the planet.”

Thomas L. Friedman, The World is Flat, 2005.

Many factors and influences have led to increasing attention being devoted to the role of Companies and CSR. These include:

  • Sustainable development
  • Globalization
  • Governance
  • Corporate sector impact
  • Communications
  • Finance
  • Ethics
  • Consistency and Community
  • Leadership
  • Business

Though the concept of CSR is not outwardly discarded by people but there are always groups of people who raise questions about its real purpose and direct impact on the business. There are many companies who are taking the initiative of CSR and fortunately most of them are successful in achieving social and economic goals.

Let’s discuss the program of CSR carried by Haagen-Dazs: **

Honeybees are disappearing at an alarming rate — and that’s bad news for the global food chain. Haagen-Dazs decided to create a microsite to raise awareness about the issue: “Honey bees are responsible for pollinating one-third of all the foods we eat, including many of the ingredients that define our all-natural ice creams, sorbets, frozen yogurt and bars.” Again, smartly tying it back to the company’s core mission.

The company is donating a portion of proceeds from its Haagen-Dazs honeybee brand to research on the topic, and it launched a modest Twitcause campaign through the #HelpHoneyBees hashtag.

The role of business is not just earning profit, but its role is more vital and wide in the society. Development of a society and the business corporate world goes hand in hand. Business is not about earning the profit, but it is utilizing it to its fullest and gaining maximum benefit from economical gain. Supporting social cause or helping society in one or other enhances the value and return of your money. Invest money wisely and earn high profit.