Corporate Social Responsibility
There are various definitions aiming to explain what Corporate Social Responsibility (CSR) signifies. Because of the many ways in which this concept is interpreted by the millions of companies around this country, and the world, there is no consensus as to what CSR could truly mean. In other words, definitions vary depending upon the field examined, and the impact of a business' actions. Yet CSR is of vital importance to the world, because it provides both for a measurement of services provided by a company, and also measures the impact of these various actions upon the population served. For this reason, some say that CSR is an indicator of the quality of management of a company.[footnoteRef:1] Others yet, for the same reason, claim that CSR measures the nature and quantity of companies' impact on society.[footnoteRef:2] [1: Baker, M. (2004). Corporate Social Responsibility. MallenBaker.net. Retrieved January 27, from . ] [2: Baker, p1. ]
This paper aims to further discuss such definitions, and establish an all-encompassing definition for CSR while also analyzing how businesses could contribute to educate others about CSR, as well as create value with customers in order to improve relationships and keep profits at a reasonable margin while also helping the community.
CSR Definitions
The two definitions presented above focused on CSR as an indicator of a company's management style or its impact upon the society that it serves. Yet there are many individuals who do not agree with such broad definitions of CSR. In fact, some claim that CSR is all about sustainable development. These persons advise that the concept should imply "a continuing commitment by business[es] to behave ethically and contribute to economic development while improving the quality of life of the workforce and […] families as well as of the local community and society at large."[footnoteRef:3] Furthermore, as these individuals add, CSR should focus on "capacity building for sustainable livelihoods [while respecting] cultural differences and [finding] business opportunities in building […] skills of employees, the community and the government."[footnoteRef:4] [3: Baker, p1.] [4: Baker, p1.]
Essentially, what all these definitions state, despite being focused or all-encompassing, is that CSR must, above all else, mean that a company manages its business processes with an outlook to producing a positive impact on society overall. This, then, is the working CSR definition for this paper, and is agreed upon by various experts.[footnoteRef:5] In fact, when one looks at a company, for investment or simply working partnership purposes, one will inevitably look to what the company has done both internally and externally and measure these two components against the company to assess overall worth. As Baker (2004) states, [5: Baker, p1. ]
"Outside stakeholders are taking an increasing interest in the activity of the company. Most look to the outer circle - what the company has actually done, good or bad, in terms of its products and services, in terms of its impact on the environment and on local communities, or in how it treats and develops its workforce. Out of the various stakeholders, it is financial analysts who are predominantly focused - as well as past financial performance - on quality of management as an indicator of likely future performance."
According to Baker it is in this latter aspect that the company's true performance, in accordance to its CSR guidelines, is evaluated and leaves the most felt imprint with a potential investor and, for this reason, the company must be quite ethical which, once again, stresses the importance of following CSR guidelines.
Creating Value
Another reason why CSR is ever important to companies, especially in today's environment, is because of the internet and the incredible ability of information to spread quickly, whether positive or negative. Plenty of companies have plummeted in customer's eyes due to unwanted commentary leaked online, later picked up by the media. For this reason, then, CSR becomes very important. A company must, in other words, above all else, show its positive impact on society so that if the moment ever comes when a company's actions are questioned, its leaders can prove...
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