Corporate Social Responsibility – Is it Enough?

Corporate Social Responsibility (CSR) helps organizations to ‘embrace responsibility’ and guides them in adhering to international norms for ethical standards. CSR is becoming an integral part of the business model, due to outside pressures from the growing conscientious public. Many CSR efforts are received with skepticism by a number of environmentalists because it’s not regulated by law and the marketing image often falls sort of the actual practices for many corporations. Though there are training organizations such as CR Academy, and the UK even had a minister for CSR for 10 years. But with the new government this post disappeared, so what is CSR and what are its advantages and disadvantages?

Companies draw up codes of conduct to reflect social values. They report on their social and environmental achievements and failures to inform and engage the public. These processes aren’t all off the cuff, a number of reporting guidelines or standards have been developed to serve as frameworks for social accounting, auditing and reporting. The UN Global Compact promoted Communication on Progress (COP) report format is one such example intended to describe a company’s implementation of the Compact’s ten universal principles. Three of these principles are based around the protection of the environment through the support and dissemination of eco-friendly technologies. The principles also incorporate human rights and labour standards.

Corporate Social Responsibility

The ISO 14000 standard focuses solely on the environmental impact of the processing of producing the product. Earthcheck certification follows the web-based tracking and measuring of resource use and waste output, enhanced design and operational efficiencies, and encourage CSR. Businesses have the fundamental limitation of having to maximize the returns for their shareholders. This means their decisions are based primarily on getting the most profits.

A CSR demonstrates a commitment to reporting against the Triple Bottom Line; the economic, ecological and social progress. ‘People, planet and profit’ form a good basic framework for the CSR documents and company operations. But self-penned documents outside legal commitments fuel debate on their value, even when companies employ independent auditors. The Enron case brings down the credibility of this in the event of conflict of interest from the external auditors.

We should consider the inherent business advantages for CSR in risk management – maintaining a reputation so as not to lose customers through for example a boycott. Also in building the public image through corporate philanthropy and in adding value through innovation and differentiation from the sustainably oblivious competition. Other benefits include the ease of human resource recruitment and retention by improving perception involving employees in fundraising activities to improve team spirit and focus on customer satisfaction. Corporations can create a greenwash with their CSR campaigns.

Deceptive marketing which pushes the green aspect of a cost reducing, profit increasing initiative is not socially acceptable and neither does it go to the root of the eco problem. Corporate responsibility is about not taking advantage of a corporation’s size and power and maintaining ethical supply chain purchasing practices.

In theory CSR is a great way for the entire business to work on green and sustainability issues rather than just working to stay out of trouble with the law. It is a way for organizations to take control and the initiative in working for a sustainable, green and ethical future. -E. MESKHI

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