Module – Introduction to Business Studies

(IBS).
Short Title – IBS.

DATE:

Lecturer:
Week 5 lecture : Corporate Social Responsibility

▪ Module code – FY021

▪ Level 3
▪ Week 5 lecture
▪ Email:
▪ Office hour:
▪ Pat hour:
Learning outcomes:

▪To understand what corporate social responsibility is.

▪ To understand criteria of corporate social performance
▪ To understand four perspectives of CSR
▪ To debate case against/for CSR
▪ To understand what Business sustainability is.
▪ To understand what FTSE4Good Index Series is.

▪
Corporate Social Responsibility (CSR)

Quotes on CSR (1)

Corporate Social Responsibility defined

▪ Quotes on CSR (2)

▪ “Corporate responsibility refers to the awareness, acceptance and
management of the wider implications of corporate decisions” (Body
2017).
▪ “Corporate social responsibility means that a corporation should be
held accountable for any of its actions that affect people, their
communities and their environment”. (Worthington and Britton 2006).
▪ It also means that negative impacts on people and society should be
acknowledged and corrected before it destroys lives and property.
Definition of the concept – 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.

European Commission(n.d)

▪
Definition of the concept – CSR is…

The commitment of business to contribute to sustainable economic

development, working with employees, their families, the local
community and society at large to improve their quality of life - World
Business Council on Sustainable Development (n.d.).
CSR Means:

▪ Conducting business in an ethical way and in the interests of the

wider community

▪ Responding positively to emerging societal priorities and

expectations

▪ Balancing shareholder interests against the interests of the wider

community
Criteria of corporate social performance

Criteria of corporate social responsibilities

Discretionary
Economic Legal Ethical responsibility responsibility
responsibility (make responsibility (do what is right; (contribute to
profit) (lobby the law) obey the law) community, be
Philanthropic

▪ Source: Body (2014)

Criteria of corporate social performance

▪ Economic
- responsibility to earn profit for owners
▪ Legal
-responsibility to comply with the law
▪ Ethical
-not just acting for profit but doing what is right, just and fair
▪ Voluntary and philanthropic
-promoting human welfare and goodwill.
-being a good corporate citizen contributing to the community
and the quality of life.
The debate on social responsibility (1)

▪Not all business organisations behave in a socially

responsible manner.

▪ Some argue that it is not the job of business

organisations to be concerned about social issues and
problems.
The case against CSR

▪ The only social responsibility of business is to create shareholder

wealth.
▪ The efficient use of resources will be reduced if businesses are
restricted in how they can produce.
▪ Businesses cannot decide what is in society’s interest.
▪ Extra costs will be incurred which must be passed on to consumers.
▪ An unwelcome extra responsibility for businesses.
Arguments for CSR

▪ It is the ethical thing to do

▪ It improves the firm’s public image and reputation
▪ It is necessary in order to avoid excessive regulation
▪ Socially responsible actions can be profitable
▪ An improved social environment will be beneficial to the firm
▪ It will be attractive to some investors
▪ It can increase employee motivation
▪ It helps to correct social problems caused by business
Business Sustainability
 So, for companies/firms development to be sustainable, it must address
important issues at the macro level, such as:
▪ Economic efficiency (innovation, prosperity and productivity).
▪ Social equity (poverty, communities, health, wellness and human right).
▪ Environmental accountability, (climate change, land use and biodiversity).
The FTSE4Good Index Series

▪ The FTSE4Good Index Series guides investors on companies

which meet defined criteria of Corporate Responsibilities. These are
developed in consultation with NGOs, governments and other
players: to be part of the index companies need to show they are
working towards:
▪ Environment management;
▪ Climate change mitigation and adaptation;
▪ Countering bribery
The FTSE4Good Index Series guides

▪ upholding human and labour rights; and

▪ supply chain labour standards
▪ Trust is now one of the most valued assets in any
organization. Without the trust of our stakeholders, the
sustainability of our business is at risk.
Activity

▪ Discuss with your course mate what should be the responsible

action of a company/corporate organization in any community.
▪ Does responsible action affect performance?
▪ If yes…..give reasons.
▪ If no……give reasons.
▪ Responsible action must meet…………
CSR issues

▪CSR to consumers
▪ CSR in the workplace
▪ CSR in the community
▪ CSR & the environment
▪
Case- Unilever in India

▪ https://www.youtube.com/watch?v=nSal-ms0vcI
▪ Discuss this case, How you think this case has
effected the image of Unilever.
▪ Do some research to see how this in practice
changed the image of Unilever.
Self evaluation

▪Do you understand the main subject area

in this module?
▪ Ask questions?
Thank You!!