Corporate Social Responsibility organizations are growing in numbers in all parts of the world. There are many business owners who feel that the best way to do the business is to do it responsibly, but need little bit more practical information to implement CSR. Yet there are some entrepreneurs who still have no idea of how a CSR organization operates and are working in the same old fashion practically reducing their chances of surviving in the ever changing modern world.
What actually is Corporate Social Responsibility?
Against common perception, CSR is not a new concept at all. To the core, CSR is what a good business has always been about that is honest dealings, integrity, quality, long term trust, fair profits, stewardship of resources and public accountability. Brundlant Commission describes Corporate Social Responsibility as, “meeting the needs of present without compromising the ability of future generations to meet their own needs.”
CSR and Sustainable Development:
Most of the business organizations nowadays are finding it difficult to meet the challenge of how to continue the sustainable development. What is a sustainable development? It is a form of economic growth that recognizes the importance of social and environmental objectives in the long term performance and ultimate survival of the company.
Although many experts are skeptic about the performance of CSR organizations yet it has been proved on number of occasions that CSR and sustainable growth are directly proportional to each other. In fact, the sustainability leads to the institutionalization of the Corporate Social Responsibility and itself practically contradicting the neoclassical theories ad proving them wrong.
CSR: Who Pays; Who Benefits?
There is an old and very common assumption that companies implementing CSR often underperform but this statement is nothing but furthest from the truth. Numerous researches conducted of late by various firms suggest that organizations adopting CSR enjoy higher returns on investment as well as corperate growth and responsibility and that too in comparatively shorter span of time as compared to non- CSR organizations. As Niall Fitzgerald Former CEO, Unilever once said;
“Corporate social responsibility is a hard-edged business decision. Not because it is a nice thing to do or because people are forcing us to do it… because it is good for our business.”
Some Features of Corporate Social Responsibility:
Although, there are many features of a CSR organization but most important of them are as following.
- CSR organizations involve diverse partners.
- They require stakeholders to identify their respective roles and engage themselves in various business affairs.
- Most, privates firms adopt CSR and in the process, generate responsible profits.
- Finally, society reaps the benefits of sustainable growth made possible by CSR.
In the context of above discussion, following figures explains the relationship between sustainability and CSR.
Implementing Corporate Social Responsibility:
More and more companies are implementing CSR in a hope to improve the performance of their staffs and reap the benefits of sustainable growth. However, there are some rules these organizations have to abide by while adopting CSR and some of them are explained in the following lines.
- Business owners should align the concept of CSR with company’s mission, vision and goals. Therefore, CSR should be implemented strategically rather than tactically.
- CSR is a comprehensive framework that various companies develop and adopt. However, business leaders need to customize this framework in order to make it more suitable to their office environment and ensure that it corresponds directly to their goals.
- Business leaders need to remember that no generic framework fits all the situations and same is the case with CSR.
CSR Lifecycle and Sustainability:
As mentioned above, firms that adopt CSR have better chances of enjoying sustainable growth. In this regard, the sustainability is achieved through the CSR lifecycle, the main steps of which are given in the following lines.
- Initiation is the first phase of CSR lifecycle. In this phase, the organization decides to adopt CSR framework and customize it according to their mission and goals.
- The second step is of course, implementation of CSR in the organizations.
- Implementation is followed by the organization growth.
- Subsequently, all the processes of CSR are repeated to maintain the growth rate.
- It is also important to update CSR goals from time to time.
- Finally, update CSR implementation to accommodate new goals and ensure that sustainable growth of the company continues.
Core Values of CSR Organization:
Every organization has its core values and CRS organizations are no different. In this regard, business values, mission and goals are the core values of CSR. It is also necessary to note that an organization may harm its business prospects in the long run if its claims that it acts responsibly but the evidences do not support its claim.
Fiscal Integrity in a CSR organization:
The primary responsibility of any business is to remain profitable. Even in CSR organization, the higher executive cannot neglect his fiduciary responsibility because he is very much responsible for them. The CSR organization especially needs to have a clear and transparent accounting system that is consistent with international standards.
Managerial and Product Integrity:
There is no denying of the fact that a responsible company needs responsible management. A CSR organization can guarantee responsible management through policies of accountability and transparency. Similarly, if you want your CSR organization to be really successful, you also need to ensure the product integrity. The product or service of the company is the only thing that can impact the minds of the public and therefore, you need to launch product or services that become the symbol of responsible business in the market if you want to be highly successful.
In addition, a CSR organization also demands stakeholders’ engagement and transparency in all of its affairs and matters. In modern world, it has become mandatory for the businesses to be responsible because the public is more aware than ever before and the competition is growing as well. Therefore if you refuse to operate responsibly, it will simply repel your customers who now have countless options to choose from.