Why is corporate social responsibility important to an organization?

Answered by Priya Chetty on June 9, 2012 Leave a comment (0) Go to comments

Corporate Social Responsibility also referred to as corporate citizenship, corporate sustainability, corporate responsibility and responsible business refers to the organization’s obligation beyond that needs by economics or law to pursue long term aims that are beneficiary for society. Corporate social responsibility is necessarily the considering public interest inclusion into corporate decision making that goes beyond the corporation’s statutory obligation to comply with legislation (Idowu and Louche, 2010, pp 57).

It must be identified that a business cannot develop in isolation of the society and people it serves a huge part it may lie external to the conventional judgment and business system. Incorporating these outwardly focused responsibilities into the processes and management systems of business is the activity of the corporate social responsibility policy.

Commitment to the recognized corporate social responsibility areas are working honestly towards the discharge of similar responsibilities which makes good sense for the long term success of the business and the stakeholders benefits. Nowadays in environment sensitive and customer dominated market, social responsibility has become the common denominator to control the corporate performance. Though corporate social responsibility must not end up as mere lip service the company must be determined to behave ethically towards the external social environment wherein it performs to contribute to the life quality and economic development of the society and community at large. This is neither in conflict with the interests of direct stakeholders and workforce from the standpoint of long term benefit and sustained growth nor in clash with the need of tenants and business of business ethics (Castka, Bamber and Sharp, 2004).

Thus Corporate Social Responsibility can be considered indeed an opportunity to develop a win-win condition for all external and internal stakeholders. The necessary role of business ethics is to harmonize and reconcile such apparent clashing interests and problems with bigger objectives of sustenance and growth of business. Thus what depends at the very core of CSR is an ethical approach to the practices of business.

References

Idowu S O and Louche C (2010), Theory and Practice of Corporate Social Responsibility, Springer, New York, pp 57.
Castka P, Bamber C and Sharp J M (2004), Implementing effective corporate social responsibility and corporate governance : a framework, British Standards Institution, UK.