Chapter # 01 CORPORATE SOCIAL RESPONSIBILITY

Definition of Corporate Social Responsibility: CSR is about how companies manage the business
processes to produce an overall positive impact on society.” OR
“The duty a corporation has to create wealth by using means that avoid harm to, protect, or enhance
societal assets”

CSR Activities: CSR Activities usually address many aspects of a firm's behavior and key elements like
health and safety, environmental community development, human rights, human resource
management, community development, consumer protection, labor protection, supplier relations,
business ethics, and stakeholder rights.

History of CSR:
i: 1800's- CSR first started during this time period where companies that operated in rural areas build
company towns. These towns including housing, stores, schools, and playground for children of their
employees.
ii: 1930's- As part of President Franklin Roosevelt's New Deal program, companies received tax breaks for
donating money to charities.
iii: 1960’s- Government steps in to regulate business with the formation of the Occupational Safety and
Health Administration(OSHA), Equal Employment Opportunity Commission(EEOC), and the
Environmental Protection Agency(EPA). This has compelled some companies to become more politically
involved by contributing time and money to non-profits.
iv: 2005- Surveys show that 98% of large corporations apply CSR in their strategic planning and 84% have
seen their profits increase because of their actions.
Examples of corporation that practice CSR principles.
Nike has improved working conditions in their operations overseas.
FedEx has begun to use hybrid trucks.
General Electric has built health care centers in Africa.

Corporate Social Initiatives are major activities undertaken by a corporation to support social causes and
to fulfill Commitments to corporate social responsibility.
CSR initiatives including:
 good governance,
 socially responsible investments and inventions,
 ensuring well being of the society including environment,
 care and respect for human rights
 and affirmative action to law so as to legitimize their work processes.

The CSR Principles: (Sustainability,Accountability,Transparency) from 1st Semester

 The charity principle is the idea that the wealthiest members of society should be charitable
toward those less fortunate.
 The stewardship principle is the idea that business leaders have an obligation to see that
everyone, particularly those in need or at risk, benefits from their firms’ actions
CSR in Equation Form Is the Sum of:
 Economic Responsibilities (Make a profit)
 Legal Responsibilities (Obey the law)
 Ethical Responsibilities (Be ethical)
 Philanthropic Responsibilities (Good corporate citizen).
Drivers of CSR :
I: The shrinking role of government
ii: Growing investor pressure
iii: Competitive markets

Benefits of CSR…
 Strengthened brand positioning.
 Enhanced corporate image.
 Increased ability to attract, motivate, and retain employees.
 Increased sales and market share.
 Increased appeal to investors and financial analysts.
CSR also known as;
Sustainable Development, Corporate Citizenship, Triple Bottom Line, Business Ethics and Sustainable
Business Practices.
Private Sector Perspective: “Corporate Social Responsibility is not a cosmetic; it must be rooted in our
values. It must make a difference to the way we do our business.”
CSR EXAMPLES:
Kal Ke Liye Aaj Badlo Bu Mobilink002E, IBM UK, AVON, TOI’s Lead India campaign, UnileverPakistan.
CSR – A New Paradigm:
To think comprehensively and systematically about:
 The role of business in development.
 The manner in which the business is conducted.
 Corporate Governance.
 Poverty alleviation.
 Corporate contribution to peace and war against terror.
 Business, government and civil society partnership- common ground and collective action.