What sort of CSR activities could be effective for showing your organization cares?

CSR has become such a hot topic in business that many universities have opened specific courses, departments or even institutes on the subject. When Fortune selects the ‘Most Admired Companies’, CSR is one of the major evaluating standards; and when Financial Times chooses the ‘Company of the Year’, one of the criteria is the company’s contribution to the economy and to society. Meanwhile there are some other indexes on CSR, such as the Dow Jones Sustainability Index called the ‘Domini 400 Social Index’. Governments everywhere are keen to promote it. For example, Bill Clinton, the former president of the US, introduced the White House Apparel Industry Partnership (now known as the Fair Labour Association) and in Britain, there is the Ethical Trading Initiative (ETI). With the government’s encouragement, business, labour unions and NGOs thus join together to explore how to further promote CSR. The United Nations has also introduced Global Compact, focusing on corporate responsibility towards the environment and society. Tools include the Global Reporting Initiative (GRI) have been set up. The International Standards Organistaion (ISO) is also planning to come out with a CSR standard. There are bookstores with CSR sections as many more books and journals on this subject are meeting the market demand. Recently in China, courses on ‘anti-CSR’ (getting around, or cheating CSR) have been offered, and taught by ex-auditors and company consultants which have been well attended.

CSR and Economic Benefits

We may conclude that in light of the dubious benefits of CSR, in recent years, a disproportionate number of conferences are being held in relation to CSR. One of the problems with the proliferation of instruments and conferences is that there is no commonly agreed definition of CSR, and different types of corporations may get involved in different aspects of it. Approaches to CSR may include: to comply with the law and local moral codes; to observe the code of Business Ethics; to be accountable to shareholders and to the public; to support philanthropic work and make donations to the charities; to promote the social participation of corporations; and also to protect the environment, promote occupational safety, safeguard the lawful rights of labour, show respect to the community and protect the disadvantaged. Further difficulties in defining a CSR approach arise from the fact that the corporation faces different groups in different areas: in relation to the environment, the corporation has to deal with organizations for environmental protection and local communities; with regard to labour issues, they must work with labour organizations, workers and labour unions.

The differences in the definition of CSR also reflect the diversity of people’s views of it. Some researchers try to distinguish the social responsibility of the corporation from its economic responsibility, believing that their economic responsibility is to pursue the greatest interests of the shareholders, while their social responsibility is to satisfy the generally acceptable demand of the public in social sustainability and social justice. Yet this kind of demarcation ignores reality. The dominant view amongst those business consultants and researchers who actively ‘sell’ the idea of CSR now appears to be that the promotion of CSR can bring huge profits to the corporation. Indeed, a great deal of evidence shows that the implementation of CSR can: 1) boost the sales of their products, and increase their market share; 2) help the brand attain a good reputation; 3) improve the image of the corporation; 4) attract and retain talent, and promote employee productivity; 5) reduce production costs; and 6) attract more investment and achieve more positive credit ratings. In short, CSR is a way to increase profits, and of great significance in terms of economics. From this perspective it might be argued that the corporation does not see CSR as its obligation, but as a business strategy to achieve greater profits by fulfilling its social responsibility.

Business for Social Responsibility, an American pro-business organization, has expressed the view that CSR means to attain business achievements by respecting ethical values and protecting the communities and the environment. CSR is thus transformed into a new way of reaching the corporation’s final goal of profit-making. This profit-oriented approach CSR is subjected to much criticism from many NGOs and trade unions. Contrary to the ‘social’ approach to CSR, a thorough CSR approach enters into every sector of the corporation in order to achieve greater productivity and profits. CSR is not limited to the corporation’s participation in the society and social life, but has the potential to bring about changes to the relationships between the corporation and its stakeholders. Furthermore, CSR also alters labour relations in the factories that produce for the corporations. So the economic activities of the corporation can bring positive or negative impacts to society. To separate the corporation’s economic responsibility from its social one is to neglect the fact that these two responsibilities have been intermingled in the operation of the corporation.

Another way to define CSR is to analyze the nature of CSR itself. Kotler and Lee (2005, pp.4-10) point out that CSR is a voluntary self-commitment made by the corporation itself to improve community well-being through ‘discretionary’ business practices and ‘discretionary’ contributions of corporate resources to society. The well-being of the community includes the happiness of the human being and the protection of the environment. Kotler and Lee (2005 p.3) emphasize the discretionary nature of the commitment made by many companies which adopt CSR approaches. CSR is not stipulated by the law; it is not even necessarily a response to the public demand. The corporation’s ‘discretionary’ business activities go beyond ethics, law, normal business operation or even the expectations of the public. Nevertheless, this ‘discretionary’ nature of CSR gives rise to a good deal of criticism from many NGOs and trade unions. Many corporations have their own ‘codes of conduct’, which state that they and their partners in production must follow the local labour laws; yet most of these local labour laws are far below international labour standards, especially in the area of collective labour rights such as Cambodia and Bangladesh.. Even in some regions where there is comprehensive labour legislation, if the local government is powerless or is unwilling to enforce the legislation, the regulations originally stipulated in the law then become merely the ‘discretionary’ proper behaviour of the corporation, the notable examples are China and the Philippines. In other words, the corporation can decide ‘at its discretion’ how to follow the codes of conduct, which articles they should follow, and which they can temporarily suspend. The labour law itself has thus been privatized.

Being ‘discretionary’ is a fundamental feature of CSR. From the corporation’s point of view, it contributes ‘of its own will’; CSR is not its obligation. Thus, it is the corporation’s extra contribution to the society. Yet from the point of view of many NGOs and trade unions, this ‘discretionary’ nature of CSR is not subject to the law. The self-monitoring of corporations cannot guarantee anything. It amounts to just a publicity strategy.

There are conflicting views between the business sector and NGOs and trade unions on CSR. In this article, we would like to examine some underlying problems of CSR from a labour’s perspective such as AMRC. As we are more focused on the labour situation in China, in this article we pay more attention to CSR in relation to labour conditions, and use the actual situation of workers in Southern China as an example. Whilst labour relations are only one area of CSR amongst many, insufficient adherence to decent labour standards in production and procurement are one of the most crucial and difficult problems that CSR seeks to resolve. In fact, whenever CSR is involved, most corporations prefer to deal with the technical aspects of the situation. Similarly, where environmental protection is concerned, corporations will tend to seek technical measures to reduce pollution. Because of this preference for ‘technical approaches’, occupational safety is a relatively easy matter for the corporation to deal with, because many problems can be solved technically, i.e., by implementing measures to protect workers’ health and to reduce industrial accidents. Yet labour issues cannot be wholly dealt with in a technical way; some issues involve changing the nature of the management of the corporation in order to alter the power relations between the workers and the management and the solidarity among the workers between the North and South, and amongst factories producing for the same brands. These kinds of issues cannot be resolved through improvement in technical areas alone. They are related not only to reform in corporate management, but to the most sensitive relational issues including the right of workers to speak up on factory affairs where their interests are involved.

Question Description

A”CSR Practices”.Please imagine you own or run a business and you want to work on your CSR. What practices might you put in place in the organization? What sort of CSR activities could be effective for showing your organization cares? just 300-400 words! thank you!

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