Wait a second!
More handpicked essays just for you.
More handpicked essays just for you.
CSR and company performance
Roles of social responsibility in business organization
Don’t take our word for it - see why 10 million students trust us with their essay needs.
Recommended: CSR and company performance
Question 2. Assuming that being led by its CEO John Smith, Smith Insurance Company is a big company that faces increasing demand for insurance. Over the past 3 years, the competitors are almost equal in their performance to Smith’s insurance, yet not their involvement in social responsibility. (a) Suggest the best approach of the following approaches for John to use in order to better position the company against the competitors. Justify your answer with advantages of the approach and a relevant example • Obstructionist stance • Defensive stance • Accommodative stance • Proactive stance Answer: (a) Corporate social responsibility (CSR) is management’s obligations to make decisions and take actions to contribute the welfare and interests of …show more content…
Managers often put shareholder interest above all other stakeholders and managers say society should make laws if change is needed. In Smith Insurance Company, defensive stance will have side effects on the company. With defensive stance, managers in the company only obey the laws and regulations, but they do not consider their corporate social responsibilities to take some actions to benefit other stakeholders except shareholders. Managers only focus on the maximum of the profits and to meet the expectations of shareholders, but they do not take account on benefit the whole society. The decisions of managers are legal, but they may be unethical. Finally Smith Insure Company may lose competitive advantage and customers in the market, and hence lost …show more content…
A stakeholder can affect or can be affected by the organisation. There are various stakeholders include primary and secondary stakeholders. The primary stakeholders who have direct economic transactions with the company such as customers, employees, and suppliers, etc. The secondary stakeholders involve the communities, government, the general public and business support groups and the activist groups and the media, etc., who do not directly engage in the economic exchange in the organisation. The stakeholders of Air New Zealand include customers, employees, shareholders, suppliers, governments, partners, special interest groups, non-governmental organisations and creditors and communities, etc. Now the stakeholders of customers, employees and communities will be analysed. The benefits of Air New Zealand social responsible practices that may influence the three of their stakeholders: customers, employees and
The two primary stakeholders are the company’s customers and employees/suppliers who are directly involving in the company’s business. The two secondary stakeholders who do not engage directly with the business are the general public and environmental activist groups.
Stakeholder is anyone with an interest in a business; stakeholders are individual, groups or businesses. They are affected by the activity of the business. There are two types on stakeholders who are internal and external. Internal stakeholder involves employees, managers/directors and shareholders/owners. External stakeholder involves suppliers, customers, government, trade unions, pressure groups and local and national communities.
Studies show that the more a company engages in stakeholders’ relationship, the more it gets mindful of other external factors and how to use them as an advantage, for instance getting involved in social and environmental issues. (Falck, 2007) On this note, we noticed HomeServe is currently putting forward an interest to help and support vulnerable people of the community, to start participating in charitable work and care for the environment by reducing carbon emissions per worker. (HomeServe Annual Report,
Corporate social responsibilities (CSR) have a different meaning in different company but in my view CSR is the concept which is the ability one of the companies can do for society. As the company responsibilities toward the society and environment in the way operate their business. CSR is about how companies manage the business processes to produce an overall positive impact on society. CSR also known as a “corporate citizenship” and with do that CSR is not provide an immediate financial benefit to the company but promote positive social and environmental change. (www.investopedia.com/terms/c/corp-social-responsibility). CSR is a high profile nation which the business world perceives as a strategic (Economist, 2008; Porter & Kramer, 2006)
To supply the wants and needs of a consumer, society entrusts wealth-producing resources to the business enterprise.” (Santayana, George. Is The Tyranny Of Shareholder Value Finally Ending? So before we go into greater detail on the different perspectives related to social responsibility, one might question the meaning of social responsibility. It is generally agreed that social responsibility is defined as the business obligation to make decisions that benefit society.... ...
This paper will have a detailed discussion on the shareholder theory of Milton Friedman and the stakeholder theory of Edward Freeman. Friedman argued that “neo-classical economic theory suggests that the purpose of the organisations is to make profits in their accountability to themselves and their shareholders and that only by doing so can business contribute to wealth for itself and society at large”. On the other hand, the theory of stakeholder suggests that the managers of an organisation do not only have the duty towards the firm’s shareholders; rather towards the individuals and constituencies who contribute to the company’s wealth, capacity and activities. These individuals or constituencies can be the shareholders, employees, customers, local community and the suppliers (Freeman 1984 pp. 409–421).
Corporate Social Responsibility (CSR) is the way a corporation achieves a balance between its economic, social, and environmental responsibilities in its operations so as to address shareholder and other stakeholder expectations. In general, when firms hold this wider encouraging role on the public by being engaged with stakeholders, a variety of profit can be produced for both company and the stakeholders. A key inclination is the combination of Corporate Social Responsibility (CSR) into the organization strategy, culture, mission and communications. By incorporating corporate citizenship into the company it is no longer an additional “nice thing to do” or something made to obey laws or regulations. Instead, corporate responsibility has become something business leaders and workforce want to engage in, frequently because executives who believe in the long-term see business profit. The four types of social responsibilities a...
Corporate Social Responsibility (CSR) is the set of regulations that an organization makes to protect and increase the society in which it functions. There are three areas of social responsiblity: Organizational stakeholders, the natural environment and general social welfare.
Social responsibility allows for the market system to be centrally controlled by forcing shareholders to unwillingly contribute to social responsibility. While this idea of social responsibility may help companies in the short run, it will ultimately hurt them in the long run. Each person has their own values and responsibilities and “society is a collection of individuals and of the various groups they voluntarily form” (55). Businesses, as Friedman understands, are separate from this society since individuals are the only ones who can hold values and responsibilities. Subsequently, businesses are freed of the need to embed social responsibility into their practices and should focus only on creating the largest profit possible for their shareholders
I begin this essay by defining CSR, there are many definitions for this term by various different theorists, and EU says that CSR is "A concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis." On the other hand, Sloman et al. define it as "The concept in which a firm takes into account is the interests and concerns of a community rather than just its shareholder". Davis and Blomstrom (1966), say it "Refers to a person’s obligation to consider the effects of his decisions and actions on the whole social system". These definitions differ from one another in many ways but they agree that CSR involves taking the environment into account and therefore, one must look take social responsibility.
Stakeholders are those groups or individual in society that have a direct interest in the performance and activities of business. The main stakeholders are employees, shareholders, customers, suppliers, financiers and the local community. Stakeholders may not hold any formal authority over the organization, but theorists such as Professor Charles Handy believe that a firm’s best long-term interests are served by paying close attention to the needs of each of these stakeholders. The modern view is that a firm has responsibilities to all its stakeholders i.e. everyone with a legitimate interest in the company. These include shareholders, competitors, government, employees, directors, distributors, customers, sub-contractors, pressure groups and local community. Although a company’s directors owes a legal duty to the shareholders, they also have moral responsibilities to other stakeholder group’s objectives in their entirely. As a firm can’t meet all stakeholders’ objectives in their entirety, they have to compromise. A company should try to serve the needs of these groups or individuals, but whilst some needs are common, other needs conflict. By the development of this second runway, the public and stakeholders are affected in one or other way and it can be positive and negative.
CSR is the obligation of business to promote and to protect the interest of shareholders.
Stakeholders refer to individuals or groups of people that have an interest in a business. Management argues that as long as there is wealth for shareholders, then anything is done in a responsible manner and things should be done to promote the interest of other stakeholders.
Examples of Stakeholder’s could be: managers, directors, employees etc. It is based upon a conceptual framework approach in which it provides moral and ethical values to a business organisation. When in practice, majority of organisations are mainly going to focus on corporate social responsibility. The reason for this is because CSR is seen to have a big impact on the firm as many people are recognising that there is a increasing number of businesses that are both socially and environmentally friendly. On the other hand, if the government doesn’t intervene with companies in terms of both regulation and legislation, this means that firms will only be concentrating on the accounting figures. If companies are primarily focusing on the accounting figures, this indicates that businesses are not taking in the social and environmental impact of the activities within the organisation. In (Liu, Fellows and Tuuli, 2011), it refers to corporate citizenship values in which it considers and identifies the different demands of the stakeholder groups to see where the overall value of the company comes from taking into thought the environment and
A company has an economic obligation. It must earn a favorable return for its stockholders in the restrictions of the law. But, corporate social responsibility means that organizations have also ethical and societal responsibilities that go past their economic responsibilities. CSR needs organizations to develop their documentations of their responsibilities to include other stakeholders such as workers, customers, suppliers, local societies, state governments, international organizations, etc. Ethics could be seen as a fundamental component of individual and group activities at the heart of organizations’ errands.