Effectiveness Of CSR

The effectiveness of ‘carrot’

Benefit from CSR can somehow encourage corporations to adopt CSR. Many enterprises realize that they must deal with CSR issues to ensure their position on the market and maximum marking share. She thought that involving in CSR can bring intangible interests such as employee loyalty and good reputation for companies (Gazzola, 2012). Moreover, firms can also avoid crisis. Therefore, those benefits may promote CSR among companies (Gazzola, 2012).

Although many articles stated that profit and CSR have positive relationships, research found that factors such as labour market conditions and company’s size and so on will all influence the level of CSR in a company (Abagail and Donald, 2001). Abagail and Donald (2001) found that “there is a neutral relationship between CSR and financial performance”. Ivar (2007) thought investment on CSR will not contribute to corporate profit or companies will get very few return from CSR relative activities. More profit making by companies will not result in more CSR investment. He found that companies may not gain enough benefit from CSR, they can just meet the bottom line sometimes. If companies do thing beyond their operation and are positive at CSR, it is because of their good intention rather than purpose of gaining profits (Ivar, 2007). The way of using benefits to increasing CSR seems difficult in this situation. Ravi and Anupam (2011) showed that in order to be successful, Nestle began to help local farmers in production; they then gain good profits and reputation with the success of those farmers. Good image also helped them reduce the regulatory interventions when entered Indian markets (Ravi and Anupam, 2011). This encourage it donate more on CSR. Nevertheless,...

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...ses. Companies which are motivated to implement CSR practice intrinsically consider CSR as part of their core value and corporate culture (Moore et al., 2012). Their research found that companies with both external and internal purposes and implement CSR practice intrinsically will more likely to invest with planning and gain more benefits from it.

They also revealed that different industries expect to get dissimilar benefits from implementing CSR. For instance, oil industry prefers regulatory protection because implementation of CSR can help them build good relationship with regulatory agencies; while retail industry want to have better risk management to prevent them from risk such as consumer boycotts and lawsuits avoid lawsuits (Moore et al., 2012). It is to say if companies from different industries can gain want they want, CSR is more likely to be increased.