Corporate Social Responsibility CSR

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Corporate social responsibility ‘Corporate social responsibility’ (CSR) means that the firm has wider responsibilities in relation to objectives and people apart from the owners or shareholders (Beal and Goyen 2005). These responsibilities are achieved when the firm adapts all of its practices to ensure that it operates in ways that meet, or exceed, the ethical, legal, commercial and public expectations that society has of business. Objectives often associated with CSR include a responsibility to manage natural assets sustainably and not to pollute by chemical discharge, smell, noise, dust or other irritants; fair treatment of employees and ethical attitude towards clients. The other people include employees, customers, suppliers, regulators and the public at large. In terms of CSR, management should make decisions based not only on financial factors such as profits or dividends, but also based on the immediate and long-term social and environmental consequences of their activities. CSR is increasingly being seen as an important and integral part of normal business operations. There are several advantages to adopt CSR for companies (Singapore Compact 2007).  Create Shareholder Value Today consumers, investors, governments and even employees have become more sophisticated and more aware of good or bad corporate behaviour. An increasing number of investors are willing to invest in such companies that can meet certain environmental or social standards. There is growing evidence now that companies that embrace CSR generally outperform their competitors that do not consider CSR. Embrace of CSR can improve the company’s relations with its stock market valuation by protecting it from instability and share price volatility.  Enhanc... ... middle of paper ... ...gress on the non-financial performance. For example, the DJSI results showed that ANB improved in risk and crisis management and stakeholder engagement; ANB got its REputex social responsibility rating of AA; ANB is included in the FTSE4Good Index (NAB Group 2007). References ASX, NATIONAL AUSTRALIA BANK LIMITED (NAB), 2007, Available: http://www.asx.com.au/asx/research/CompanyInfoSearchResults.jsp?searchBy=asxCode&allinfo=on&asxCode=NAB, Accessed 2 August 2007. Diana Beal and Michelle Goyen (2005) Introducing Corporate Finance, John Wiley and Sons Australia Ltd., Milton, Queensland, Australia. National Australia Bank Group, Corporate Social Responsibility Reports, 2007, Available: http://www.nabgroup.com/0,,76587,00.html, Accessed 2 August 2007. Singapore Compact, What is CSR?, 2007, Available: http://www.csrsingapore.org/whatiscsr.php, Accessed 2 August 2007.
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