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PROJECT REPORT
ON
CORPORATE SOCIAL RESPONSIBILITIES ADOPTED BY
BANKING & INSURANCE SECTOR
Submitted in partial fulfillment of requirement of Bachelor of Business
Administration (B.B.A) General
BBA VI Semester (B) (M)
Batch 2010-2013
Submitted to: Submitted by:
Ms. Neha Gupta Shweta Mavi
Assistant Professor 13214101710
JAGANNATH INTERNATIONAL MANAGEMENT SCHOOL.
KALKAJI
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TABLE OF CONTENTS
S.NO DESCRIPTION PAGE NO.
1 ACKNOWLEDGEMENT 3
2 CERTIFICATE OF COMPLETION 4
3 STUDENTS DECLARATION 5
4 EXECUTIVE SUMMARY 6-8
5 CHAPTER-1
- INTRODUCTION
- HISTORICAL BACKGROUND
- CURRENT STATE OF THE FIELD
9-36
6 CHAPTER-2
- OBJECTIVES
37
7 CHAPTER-3
- RESEARCH METHODOLOGY
38-42
8 CHAPTER-4
- ANALYSIS
43-77
9 CHAPTER-5
- RECOMMENDATIONS & LIMITATIONS
78
10 CHAPTER-6- CONCLUSION
79
11 CHAPTER-7
- REFERENCES
80
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ACKNOWLEDGMENT
I take this opportunity to express my profound gratitude and deep regards to my guide
Ms. Neha Gupta for her exemplary guidance, monitoring and constant encouragement
throughout the course of this thesis. The blessing, help and guidance given by her time
to time shall carry me a long way in the journey of life on which I am about to embark.
I also take this opportunity to express a deep sense of gratitude to my college, HOD
(Ms. Rashmi Bhatia), my class coordinator (Dr. Ruchi Singhal), and all other faculties for
their cordial support, valuable information and guidance, which helped me in completing
this task through various stages.
Lastly, I thank almighty, my parents, brother, sisters and friends and atlas but not the
least for the constant encouragement and blessings without which this project would not
be possible.
SHWETA MAVI
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CERTIFICATE OF COMPLETION
This is to certify that Shweta Mavi, pursuing BBA 6 thsem (B) (M) from JIMS KALKAJI,
has completed his project on the topic CORPORATE SOCIAL RESPONSIBILITIES
ADOPTED BY BANKING & INSURANCE SECTORunder my guidance.
Her work is appreciable.
Project Guide:
Ms. Neha Gupta
Assistant Professor
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STUDENTS DECLARATION
I hereby declare that the project report titled CORPORATE SOCIAL
RESPONSIBILITIES ADOPTED BY BANKING & INSURANCE SECTOR is my own
work and has been carried out under the table guidance of Ms. Neha Gupta (Assistant
Professor at JIMS Kalkaji). All care has been taken to keep this project error free and I
sincerely regret for any unintended discrepancies that might have crept into this report.
Thank You
(SHWETA MAVI)
BBA 6thSem (B)(M)
Jagannath International Management School
(KALKAJI)
Date:-13/03/2013
Place-Delhi
mailto:[email protected]:[email protected] -
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EXECUTIVE SUMMARY
CORPORATE SOCIAL RESPONSIBILITY
Corporate social responsibility is a form ofcorporate self-regulation integrated into
a business model. CSR policy functions as a built-in, self-regulating mechanism
whereby a business monitors and ensures its active compliance within the spirit of the
law, ethical standards, and international norms. CSR is a process with the aim to
embrace responsibility for the company's actions and encourage a positive impact
through its activities on the environment, consumers, employees, communities,
stakeholders and all other members of the public sphere who may also be considered
as stakeholders.
The term "corporate social responsibility" came into common use in the late 1960s and
early 1970s after many multinational corporations formed the term stakeholder,
meaning those on whom an organization's activities have an impact. It was used to
describe corporate owners beyond shareholders as a result of an influential book by R.
Edward Freeman,Strategic management: a stakeholder approach in
1984.[2]Proponents argue that corporations make more long term profits by operating
with a perspective, while critics argue that CSR distracts from the economic role of
businesses. Others argue CSR is merely window-dressing, or an attempt to pre-empt
the role of governments as a watchdog over powerful multinational corporations.
http://en.wikipedia.org/wiki/Corporatehttp://en.wikipedia.org/wiki/Self-policinghttp://en.wikipedia.org/wiki/Business_modelhttp://en.wikipedia.org/wiki/Norm_(sociology)http://en.wikipedia.org/wiki/Stakeholder_(corporate)http://en.wikipedia.org/wiki/Public_spherehttp://en.wikipedia.org/wiki/Stakeholder_(corporate)http://en.wikipedia.org/wiki/Shareholdershttp://en.wikipedia.org/wiki/R._Edward_Freemanhttp://en.wikipedia.org/wiki/R._Edward_Freemanhttp://en.wikipedia.org/wiki/Corporate_social_responsibility#cite_note-2http://en.wikipedia.org/wiki/Corporate_social_responsibility#cite_note-2http://en.wikipedia.org/wiki/Corporate_social_responsibility#cite_note-2http://en.wikipedia.org/wiki/Display_windowhttp://en.wikipedia.org/wiki/Multinational_corporationshttp://en.wikipedia.org/wiki/Multinational_corporationshttp://en.wikipedia.org/wiki/Display_windowhttp://en.wikipedia.org/wiki/Corporate_social_responsibility#cite_note-2http://en.wikipedia.org/wiki/R._Edward_Freemanhttp://en.wikipedia.org/wiki/R._Edward_Freemanhttp://en.wikipedia.org/wiki/Shareholdershttp://en.wikipedia.org/wiki/Stakeholder_(corporate)http://en.wikipedia.org/wiki/Public_spherehttp://en.wikipedia.org/wiki/Stakeholder_(corporate)http://en.wikipedia.org/wiki/Norm_(sociology)http://en.wikipedia.org/wiki/Business_modelhttp://en.wikipedia.org/wiki/Self-policinghttp://en.wikipedia.org/wiki/Corporate -
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BANKING & INSURANCE SECTOR
The economic reforms undertaken in the last 15 years have brought about a
considerable improvement in the health of banks and financial institutions in India. The
banking sector is a very important sector of the Indian economy. The sector has made a
marked improvement in the liberalization period. The limit for foreign direct investment
in private banks has been increased from 49% to 74%.
In addition, the limit for foreign institutional investment in private banks is 49%.
Liberalization and globalization have created a more challenging environment in the
banking sector as well as in the other segments of the financial sector such as mutual
funds, Non Banking Finance Companies, post offices, capital markets, venture
capitalists, etc. Now the challenges faced by the sector would be gaining profitability,
reinforcing technology, maintaining global standards, corporate governance, sharpening
skills, risk management and, the most important of all, to establish 'Customer Intimacy'.
New players have contributed to the launch of innovative products, services and value-
added benefits. Major foreign players have entered the country and announced joint
ventures in both life and non-life areas. These include New York Life, Aviva, Tokio
Marine, Allianz, Standard Life, Lombard General, AIG, AMP and Sun Life among
others.
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CSR ADOPTED BY BANKING AND INSURANCE SECTOR
CSR has been identified as a tool to contribute directly or indirectly to the companys
bottom-line and also ensures its long-term sustainability. It helps companies emerge as
true corporate citizens. CSR means in its essence to be responsible to ones various
stakeholders and not just charity.
At present, the world over, there is an increasing awareness about Corporate Social
Responsibility (CSR), Sustainable Development (SD) and Non-Financial Reporting
(NFR). Consequently, there is a concerted effort among all types of organizations, to
ensure that sustainable development is not lost sight of, in the pursuit of their respective
goals - profit making, social service, philanthropy, etc. CSR entails the integration of
social and environmental concerns by companies in their business operations as also in
interactions with their stakeholders.
The contribution of financial institutions including banks to sustainable development is
paramount, considering the crucial role they play in financing the economic and
developmental activities of the world. In this context, the urgency for banks to act as
responsible corporate citizens in the society, especially in a developing country like
ours, need be hardly overemphasized. Their activities should reflect their concern for
human rights and environment.
Studies over the recent times have revealed that organisations involved in CSR
activities continued to sustain for much longer durations in comparison to those not
involved in such activities. This is the reason why more and more organisations across
sectors are increasingly getting involved in CSR activities.
CSR has been identified as a tool to contribute directly or indirectly to the companys
bottom-line and also ensures its long-term sustainability. It helps companies emerge as
true corporate citizens. CSR means in its essence to be responsible to ones various
stakeholders and not just charity.
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CHAPTER-1
INTRODUCTION
CORPORATE SOCIAL RESPONSIBILITY
Corporate social responsibility is a form ofcorporate self-regulation integrated into
a business model. CSR policy functions as a built-in, self-regulating mechanism
whereby a business monitors and ensures its active compliance within the spirit of the
law, ethical standards, and international norms. CSR is a process with the aim to
embrace responsibility for the company's actions and encourage a positive impact
through its activities on the environment, consumers, employees, communities,
stakeholders and all other members of the public sphere who may also be considered
as stakeholders.
http://en.wikipedia.org/wiki/Corporatehttp://en.wikipedia.org/wiki/Self-policinghttp://en.wikipedia.org/wiki/Business_modelhttp://en.wikipedia.org/wiki/Norm_(sociology)http://en.wikipedia.org/wiki/Stakeholder_(corporate)http://en.wikipedia.org/wiki/Public_spherehttp://en.wikipedia.org/wiki/Public_spherehttp://en.wikipedia.org/wiki/Stakeholder_(corporate)http://en.wikipedia.org/wiki/Norm_(sociology)http://en.wikipedia.org/wiki/Business_modelhttp://en.wikipedia.org/wiki/Self-policinghttp://en.wikipedia.org/wiki/Corporate -
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The term "corporate social responsibility" came into common use in the late 1960s and
early 1970s after many multinational corporations formed the term stakeholder,
meaning those on whom an organization's activities have an impact. It was used to
describe corporate owners beyond shareholders as a result of an influential book by R.
Edward Freeman,Strategic management: a stakeholder approach in
1984.[2]Proponents argue that corporations make more long term profits by operating
with a perspective, while critics argue that CSR distracts from the economic role of
businesses. Others argue CSR is merely window-dressing, or an attempt to pre-empt
the role of governments as a watchdog over powerful multinational corporations.
CSR is titled to aid an organization's mission as well as a guide to what the company
stands for and will uphold to its consumers. Development business ethics is one of the
forms ofapplied ethics that examines ethical principles and moral or ethical problems
that can arise in a business environment. ISO 26000 is the recognized international
standard for CSR. Public sector organizations (the United Nations for example) adhere
to the triple bottom line (TBL). It is widely accepted that CSR adheres to similar
principles but with no formal act of legislation. The UN has developed the Principles for
Responsible Investment as guidelines for investing entities.
Approaches
Some commentators have identified a difference between the Canadian (Montreal
school of CSR), the Continental European and the Anglo-Saxon approaches to
CSR. And even within Europe the discussion about CSR is very heterogeneous.
A more common approach to CSR is corporate philanthropy. This includes monetary
donations and aid given to local and non-local nonprofit organizations and communities,
including donations in areas such as the arts, education, housing, health, social welfare,
and the environment, among others, but excluding political contributions and
commercial sponsorship of events.
http://en.wikipedia.org/wiki/Stakeholder_(corporate)http://en.wikipedia.org/wiki/Shareholdershttp://en.wikipedia.org/wiki/R._Edward_Freemanhttp://en.wikipedia.org/wiki/R._Edward_Freemanhttp://en.wikipedia.org/wiki/Corporate_social_responsibility#cite_note-2http://en.wikipedia.org/wiki/Corporate_social_responsibility#cite_note-2http://en.wikipedia.org/wiki/Corporate_social_responsibility#cite_note-2http://en.wikipedia.org/wiki/Display_windowhttp://en.wikipedia.org/wiki/Multinational_corporationshttp://en.wikipedia.org/wiki/Business_ethicshttp://en.wikipedia.org/wiki/Applied_ethicshttp://en.wikipedia.org/wiki/ISO_26000http://en.wikipedia.org/wiki/Triple_bottom_linehttp://en.wikipedia.org/wiki/UNhttp://en.wikipedia.org/wiki/Principles_for_Responsible_Investmenthttp://en.wikipedia.org/wiki/Principles_for_Responsible_Investmenthttp://en.wikipedia.org/wiki/Continental_Europehttp://en.wikipedia.org/wiki/Anglospherehttp://en.wikipedia.org/wiki/Philanthropyhttp://en.wikipedia.org/wiki/Philanthropyhttp://en.wikipedia.org/wiki/Anglospherehttp://en.wikipedia.org/wiki/Continental_Europehttp://en.wikipedia.org/wiki/Principles_for_Responsible_Investmenthttp://en.wikipedia.org/wiki/Principles_for_Responsible_Investmenthttp://en.wikipedia.org/wiki/UNhttp://en.wikipedia.org/wiki/Triple_bottom_linehttp://en.wikipedia.org/wiki/ISO_26000http://en.wikipedia.org/wiki/Applied_ethicshttp://en.wikipedia.org/wiki/Business_ethicshttp://en.wikipedia.org/wiki/Multinational_corporationshttp://en.wikipedia.org/wiki/Display_windowhttp://en.wikipedia.org/wiki/Corporate_social_responsibility#cite_note-2http://en.wikipedia.org/wiki/R._Edward_Freemanhttp://en.wikipedia.org/wiki/R._Edward_Freemanhttp://en.wikipedia.org/wiki/Shareholdershttp://en.wikipedia.org/wiki/Stakeholder_(corporate) -
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Some organizations do not like a philanthropy-based approach as it might not help build
on the skills of local populations, whereas community-based development generally
leads to more sustainable development.
Another approach to CSR is to incorporate the CSR strategy directly into the businessstrategy of an organization. For instance, procurement ofFair Trade tea and coffee has
been adopted by various businesses including KPMG. Its CSR manager commented,
"Fair trade fits very strongly into our commitment to our communities."
Another approach is garnering increasing corporate responsibility interest. This is
called Creating Shared Value, or CSV. The shared value model is based on the idea
that corporate success and social welfare are interdependent.
A business needs a healthy, educated workforce, sustainable resources and adept
government to compete effectively. For society to thrive, profitable and competitive
businesses must be developed and supported to create income, wealth, tax revenues,
and opportunities for philanthropy. CSV received global attention in the Harvard
Business Review article Strategy & Society: The Link between Competitive Advantage
and Corporate Social Responsibility
[1] by Michael E. Porter, a leading authority on competitive strategy and head of the
Institute for Strategy and Competitiveness at Harvard Business School; and Mark R.
Kramer, Senior Fellow at the Kennedy School at Harvard University and co-founder of
FSG Social Impact Advisors. The article provides insights and relevant examples of
companies that have developed deep linkages between their business strategies and
corporate social responsibility. Many approaches to CSR pit businesses against society,
emphasizing the costs and limitations of compliance with externally imposed social and
environmental standards. CSV acknowledges trade-offs between short-term profitabilityand social or environmental goals, but focuses more on the opportunities for competitive
advantage from building a social value proposition into corporate strategy. CSV has a
limitation in that it gives the impression that only two stakeholders are important -
shareholders and consumers - and belies the multi-stakeholder approach of most CSR
advocates.
http://en.wikipedia.org/wiki/Fair_Tradehttp://en.wikipedia.org/wiki/KPMGhttp://en.wikipedia.org/wiki/Creating_Shared_Valuehttp://en.wikipedia.org/wiki/Creating_Shared_Valuehttp://en.wikipedia.org/wiki/KPMGhttp://en.wikipedia.org/wiki/Fair_Trade -
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Many companies use the strategy of benchmarking to compete within their respective
industries in CSR policy, implementation, and effectiveness. Benchmarking involves
reviewing competitor CSR initiatives, as well as measuring and evaluating the impact
that those policies have on society and the environment, and how customers perceive
competitor CSR strategy. After a comprehensive study of competitor strategy and an
internal policy review performed, a comparison can be drawn and a strategy developed
for competition with CSR initiatives.
Social accounting, auditing, and reporting
For a business to take responsibility for its actions, that business must be fully
accountable. Social accounting, a concept describing the communication of social and
environmental effects of a company's economic actions to particular interest groups
within society and to society at large, is thus an important element of CSR.
Social accounting emphasizes the notion of corporate accountability. D. Crowther
defines social accounting in this sense as "an approach to reporting a firms activities
which stresses the need for the identification of socially relevant behavior, the
determination of those to whom the company is accountable for its social performance
and the development of appropriate measures and reporting techniques." An example
of social accounting, to a limited extent, is found in an annual Director's Report, under
the requirements ofUK company law.
A number of reporting guidelines or standards have been developed to serve as
frameworks for social accounting, auditing and reporting including:
Account Ability's AA1000 standard, based on John Elkington's triple bottom
line (3BL) reporting
The Prince's Accounting for Sustainability Project's Connected Reporting
Framework
The Fair Labor Association conducts audits based on its Workplace Code of
Conduct and posts audit results on the FLA website.
http://en.wikipedia.org/wiki/Social_accountinghttp://en.wikipedia.org/wiki/Accountabilityhttp://en.wikipedia.org/wiki/Director%27s_Reporthttp://en.wikipedia.org/wiki/UK_company_lawhttp://en.wikipedia.org/wiki/AccountAbility_(Institute_of_Social_and_Ethical_AccountAbility)http://en.wikipedia.org/wiki/AccountAbility_(Institute_of_Social_and_Ethical_AccountAbility)#AA1000_Series_of_Standardshttp://en.wikipedia.org/wiki/John_Elkingtonhttp://en.wikipedia.org/wiki/Triple_bottom_linehttp://en.wikipedia.org/wiki/Triple_bottom_linehttp://en.wikipedia.org/w/index.php?title=The_Prince%27s_Accounting_for_Sustainability_Project&action=edit&redlink=1http://www.accountingforsustainability.org/output/page171.asphttp://www.accountingforsustainability.org/output/page171.asphttp://en.wikipedia.org/wiki/Fair_Labor_Associationhttp://en.wikipedia.org/wiki/Fair_Labor_Associationhttp://www.accountingforsustainability.org/output/page171.asphttp://www.accountingforsustainability.org/output/page171.asphttp://en.wikipedia.org/w/index.php?title=The_Prince%27s_Accounting_for_Sustainability_Project&action=edit&redlink=1http://en.wikipedia.org/wiki/Triple_bottom_linehttp://en.wikipedia.org/wiki/Triple_bottom_linehttp://en.wikipedia.org/wiki/John_Elkingtonhttp://en.wikipedia.org/wiki/AccountAbility_(Institute_of_Social_and_Ethical_AccountAbility)#AA1000_Series_of_Standardshttp://en.wikipedia.org/wiki/AccountAbility_(Institute_of_Social_and_Ethical_AccountAbility)http://en.wikipedia.org/wiki/UK_company_lawhttp://en.wikipedia.org/wiki/Director%27s_Reporthttp://en.wikipedia.org/wiki/Accountabilityhttp://en.wikipedia.org/wiki/Social_accounting -
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The Fair Wear Foundation takes a unique approach to verifying labour conditions in
companies' supply chains, using interdisciplinary auditing teams.
Global Reporting Initiative's Sustainability Reporting Guidelines
Good Corporation's Standard developed in association with the Institute of Business
Ethics
Synergy Codethic 26000[2] Social Responsibility and Sustainability Commitment
Management System (SRSCMS) Requirements Ethical Business Best Practices
of Organizations - the necessary management system elements to obtain a
certifiable ethical commitment management system.
The standard scheme has been build around ISO 26000 and UNCTAD Guidance on
Good Practices in Corporate Governance. The standard is applicable by any type of
organization.;
Earthcheck www.earthcheck.org Certification / Standard
Social Accountability International's SA8000 standard
Standard Ethics Aei guidelines
The ISO 14000 environmental management standard
The United Nations Global Compact requires companies to communicate on their
progress (or to produce a Communication on Progress, COP), and to describe the
company's implementation of the Compact's ten universal principles. This
information should be fully integrated in the participants main medium of
stakeholder communications, for example a corporate responsibility or sustainability
report and/or an integrated financial and sustainability report. If a company does not
publish formal reports, a COP can be created as a stand-alone document.
The United Nations Intergovernmental Working Group of Experts on International
Standards of Accounting and Reporting (ISAR)provides voluntary technical
guidance on eco-efficiency indicators, corporate responsibility reporting,and corporate governance disclosure.
The FTSE Group publishes the FTSE4Good Index, an evaluation of CSR performance
of companies.
http://en.wikipedia.org/wiki/Fair_Wear_Foundationhttp://en.wikipedia.org/wiki/Global_Reporting_Initiativehttp://en.wikipedia.org/w/index.php?title=GoodCorporation&action=edit&redlink=1http://www.goodcorporation.com/PDF/standard_2007.pdfhttp://en.wikipedia.org/w/index.php?title=Synergy_Codethic_26000&action=edit&redlink=1http://en.wikipedia.org/wiki/Earthcheckhttp://en.wikipedia.org/w/index.php?title=Social_Accountability_International&action=edit&redlink=1http://en.wikipedia.org/wiki/SA8000http://en.wikipedia.org/wiki/Standard_Ethics_Aeihttp://en.wikipedia.org/wiki/ISO_14000http://en.wikipedia.org/wiki/United_Nations_Global_Compacthttp://www.unglobalcompact.org/COP/http://www.unglobalcompact.org/COP/http://en.wikipedia.org/wiki/United_Nationshttp://en.wikipedia.org/w/index.php?title=Intergovernmental_Working_Group_of_Experts_on_International_Standards_of_Accounting_and_Reporting_(ISAR)&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Intergovernmental_Working_Group_of_Experts_on_International_Standards_of_Accounting_and_Reporting_(ISAR)&action=edit&redlink=1http://www.unctad.org/en/docs/iteipc20037_en.pdfhttp://www.unctad.org/en/docs/iteteb20076_en.pdfhttp://www.unctad.org/en/docs/iteteb20063_en.pdfhttp://en.wikipedia.org/wiki/FTSE_Grouphttp://en.wikipedia.org/wiki/FTSE4Good_Indexhttp://en.wikipedia.org/wiki/FTSE4Good_Indexhttp://en.wikipedia.org/wiki/FTSE_Grouphttp://www.unctad.org/en/docs/iteteb20063_en.pdfhttp://www.unctad.org/en/docs/iteteb20076_en.pdfhttp://www.unctad.org/en/docs/iteipc20037_en.pdfhttp://en.wikipedia.org/w/index.php?title=Intergovernmental_Working_Group_of_Experts_on_International_Standards_of_Accounting_and_Reporting_(ISAR)&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Intergovernmental_Working_Group_of_Experts_on_International_Standards_of_Accounting_and_Reporting_(ISAR)&action=edit&redlink=1http://en.wikipedia.org/wiki/United_Nationshttp://www.unglobalcompact.org/COP/http://www.unglobalcompact.org/COP/http://en.wikipedia.org/wiki/United_Nations_Global_Compacthttp://en.wikipedia.org/wiki/ISO_14000http://en.wikipedia.org/wiki/Standard_Ethics_Aeihttp://en.wikipedia.org/wiki/SA8000http://en.wikipedia.org/w/index.php?title=Social_Accountability_International&action=edit&redlink=1http://en.wikipedia.org/wiki/Earthcheckhttp://en.wikipedia.org/w/index.php?title=Synergy_Codethic_26000&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Synergy_Codethic_26000&action=edit&redlink=1http://www.goodcorporation.com/PDF/standard_2007.pdfhttp://en.wikipedia.org/w/index.php?title=GoodCorporation&action=edit&redlink=1http://en.wikipedia.org/wiki/Global_Reporting_Initiativehttp://en.wikipedia.org/wiki/Fair_Wear_Foundation -
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In some nations, legal requirements for social accounting, auditing and reporting exist
(e.g. in the French bilan social), though international or national agreement on
meaningful measurements of social and environmental performance is difficult. Many
companies now produce externally audited annual reports that coverSustainable
Development and CSR issues ("Triple Bottom Line Reports"), but the reports vary
widely in format, style, and evaluation methodology (even within the same industry).
Critics dismiss these reports as lip service, citing examples such as Enron's yearly
"Corporate Responsibility Annual Report" and tobacco corporations' social reports.
In South Africa, as of June 2010, all companies listed on the Johannesburg Stock
Exchange (JSE) were required to produce an integrated report in place of an annual
financial report and sustainability report. An integrated report includes environmental,
social and economic performance alongside financial performance information and is
expected to provide users with a more holistic overview of a company. However, this
requirement was implemented in the absence of any formal or legal standards for an
integrated report. An Integrated Reporting Committee (IRC) was established to issue
guidelines for good practice in this field.
Potential business benefits
The scale and nature of the benefits of CSR for an organization can vary depending on
the nature of the enterprise, and are difficult to quantify, though there is a large body of
literature exhorting business to adopt measures beyond financial ones (e.g., Deming's
Fourteen Points, balanced scorecards). Orlitzky, Schmidt, and Rynes found a
correlation between social/environmental performance and financial performance.
However, businesses may not be looking at short-run financial returns when developingtheir CSR strategy. Intel employs a 5-year CSR planning cycle.
The definition of CSR used within an organization can vary from the strict "stakeholder
impacts" definition used by many CSR advocates and will often include charitable
efforts and volunteering.
http://en.wikipedia.org/w/index.php?title=Bilan_social&action=edit&redlink=1http://en.wikipedia.org/wiki/Sustainable_Developmenthttp://en.wikipedia.org/wiki/Sustainable_Developmenthttp://en.wikipedia.org/wiki/Evaluationhttp://en.wikipedia.org/wiki/Methodologyhttp://en.wikipedia.org/wiki/Lip_servicehttp://en.wikipedia.org/wiki/Enronhttp://en.wikipedia.org/wiki/Johannesburg_Stock_Exchangehttp://en.wikipedia.org/wiki/Johannesburg_Stock_Exchangehttp://en.wikipedia.org/wiki/Integrated_reportinghttp://en.wikipedia.org/wiki/W._Edwards_Deminghttp://en.wikipedia.org/wiki/Balanced_scorecardhttp://en.wikipedia.org/wiki/Philanthropyhttp://en.wikipedia.org/wiki/Philanthropyhttp://en.wikipedia.org/wiki/Volunteeringhttp://en.wikipedia.org/wiki/Volunteeringhttp://en.wikipedia.org/wiki/Philanthropyhttp://en.wikipedia.org/wiki/Philanthropyhttp://en.wikipedia.org/wiki/Balanced_scorecardhttp://en.wikipedia.org/wiki/W._Edwards_Deminghttp://en.wikipedia.org/wiki/Integrated_reportinghttp://en.wikipedia.org/wiki/Johannesburg_Stock_Exchangehttp://en.wikipedia.org/wiki/Johannesburg_Stock_Exchangehttp://en.wikipedia.org/wiki/Enronhttp://en.wikipedia.org/wiki/Lip_servicehttp://en.wikipedia.org/wiki/Methodologyhttp://en.wikipedia.org/wiki/Evaluationhttp://en.wikipedia.org/wiki/Sustainable_Developmenthttp://en.wikipedia.org/wiki/Sustainable_Developmenthttp://en.wikipedia.org/w/index.php?title=Bilan_social&action=edit&redlink=1 -
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CSR may be based within the human resources, business development orpublic
relations departments of an organisation, or may be given a separate unit reporting to
the CEO or in some cases directly to the board. Some companies may implement CSR-
type values without a clearly defined team or programme.
The business case for CSR within a company will likely rest on one or more of these
arguments:
Triple Bottom-Line
People planet profit, is also known as the Triple Bottom Line are words that should be
used and practiced in every move an organization makes. People relates to fair and
beneficial business practices toward labour, the community and region where
corporation conducts its business. Planet refers to sustainable environmental practices.
A triple bottom line company does not produce harmful or destructive products such as
weapons, toxic chemicals or batteries containing dangerous heavy metals for
example. Profit is the economic value created by the organization after deducting the
cost of all inputs, including the cost of the capital tied up. It therefore differs from
traditional accounting definitions of profit.
Human resources
A CSR program can be an aid to recruitment and retention, particularly within the
competitive graduate student market. Potential recruits often ask about a firm's CSR
policy during an interview, and having a comprehensive policy can give an advantage.
CSR can also help improve the perception of a company among its staff, particularly
when staff can become involved through payroll giving, fundraising activities or
community volunteering. CSR has been found to encourage customer orientation
among frontline employees.
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Risk management
Managing risk is a central part of many corporate strategies. Reputations that take
decades to build up can be ruined in hours through incidents such as corruption
scandals or environmental accidents. These can also draw unwanted attention from
regulators, courts, governments and media. Building a genuine culture of 'doing the right
thing' within a corporation can offset these risks.
Brand differentiation
In crowded marketplaces, companies strive for a unique selling proposition that can
separate them from the competition in the minds of consumers. CSR can play a role in
building customer loyalty based on distinctive ethical values. Several majorbrands,
such as The Co-operative Group, The Body Shop and American Apparel are built on
ethical values. Business service organizations can benefit too from building a reputation
for integrity and best practice.
Engagement Plan
An engagement plan will assist in reaching a desired audience. A corporate social
responsibility team, or individual is needed to effectively plan the goals and objectives of
the organization. Determining a budget should be of high priority. The function of
corporate social responsibility planning:
1. To add discussion and analysis of a new set of risks into corporate decision-making.
2. To represent issues within the corporation that watchdogs, NGOs and advocates
represent within society.
3. To assess the future. An organizations long term and short term future needs to be
thought of.
4. To help prioritize consideration of socially and environmentally friendly projects that
might otherwise lack a corporate advocate.
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5. To keep corporations aware of potential major societal impacts even when a negative
impact may not be immediate, and thus lessen liability.
6. To positively influence decision making where societal impacts are maximized, whilst
ensuring efforts are within a given budget.
Developing an Engagement Plan
Commit to coming up with and improving on your companies goals. CSR commitments
communicate the nature and direction of the firm's social and environmental activities
and, will help others understand how the organization is likely to behave in a particular
situation
1. Do a scan of CSR commitments
2. Hold discussions with majorstakeholders
3. Create a working group to develop the commitments
4. Prepare a preliminary draft
5. Consult with affected stakeholders
6. Revise and publish the commitments
7. Consider what is feasible within the budget
To ensure employee buy-in, include employees in the process of developing the
vision and values. To spark the process, create a CSR working group or hold a
contest for the best suggestions, encouraging employees and their
representatives to put some thought into their submissions.
Host a visioning session and ask participants to think about what the firm could
look like in the future as a CSR leader. Review the CSR priorities to determine which codes ofethics or conduct fit best
with the firm's goals.
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Consultants are recommended when planning for CSR activities involving small,
medium and large sized corporations. All levels of management should be on board,
and the support of high ranking corporate officials should be given.
License to operate
Corporations are keen to avoid interference in their business
through taxation orregulations. By taking substantive voluntary steps, they can
persuade governments and the wider public that they are taking issues such as health
and safety, diversity, or the environment seriously as good corporate citizens with
respect to labour standards and impacts on the environment.
Supplier Relations
Businesses are constantly relying on suppliers to reduce overall costs, while improving
the quality of their goods or services. Many North American companies have
downgraded the volume of suppliers they do business with, and award contracts to a
select few, in order to lower operating costs. By establishing a strong supply chain,
companies are able to push for continuous quality improvements, and price reductions.
The long-term benefits of the listed above create a better value for stakeholders.
Some multi-national companies like General Motors can shift suppliers, if a lower offer
is made by the competition. As a result, competitiveness, and greater profits are
created, in turn contributing to a stronger market
The strategic use of supplier relations can benefit single, double and triple bottom-lines.
Corporations excelling in supply relations include Wal-Mart, Ford, General
Motors, Toyota and Nestle. All companies listed above have gained tangible results
through the practice of ensuring sound supply chains, and sourcing materials
from ethical sources.
Emphasizing the importance of practicing CSR to suppliers, researching their existing
supply chain, and sending out CSR check-sheets to existing suppliers is important to
staying on-track of a companys implemented CSR activity.
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Criticisms and concerns
Critics of CSR as well as proponents debate a number of concerns related to it. These
include CSR's relationship to the fundamental purpose and nature of business and
questionable motives for engaging in CSR, including concerns about insincerity andhypocrisy.
Nature of business
Milton Friedman and others have argued that a corporation's purpose is to maximize
returns to its shareholders, and that since only people can have social responsibilities,
corporations are only responsible to their shareholders and not to society as a whole.
Although they accept that corporations should obey the laws of the countries within
which they work, they assert that corporations have no other obligation to society. Some
people perceive CSR as in-congruent with the very nature and purpose of business,
and indeed a hindrance to free trade. Those who assert that CSR is contrasting
with capitalism and are in favor of the free market argue that improvements in
health, longevity and/orinfant mortality have been created by economic
growth attributed to free enterprise.
Critics of this argument perceive the free market as opposed to the well-being of society
and a hindrance to human freedom. They claim that the type of capitalism practiced in
many developing countries is a form of economic and cultural imperialism, noting that
these countries usually have fewer labour protections, and thus their citizens are at a
higher risk of exploitation by multinational corporations.
A wide variety of individuals and organizations operate in between these poles. For
example, the Leadership Alliance asserts that the business of leadership (be it
corporate or otherwise) is to change the world for the better. Many religious and cultural
traditions hold that the economy exists to serve human beings, so all economic entities
have an obligation to society.
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Moreover, as discussed above, many CSR proponents point out that CSR can
significantly improve long-term corporate profitability because it reduces risks and
inefficiencies while offering a host of potential benefits such as enhanced brand
reputation and employee engagement.
Motives
Some critics believe that CSR programs are undertaken by companies such as British
American Tobacco (BAT), the petroleum giant BP (well known for its high-profile
advertising campaigns on environmental aspects of its operations), and McDonald's to
distract the public from ethical questions posed by their core operations. They argue
that some corporations start CSR programs for the commercial benefit they enjoythrough raising their reputation with the public or with government. They suggest that
corporations which exist solely to maximize profits are unable to advance the interests
of society as a whole.
Another concern is that sometimes companies claim to promote CSR and be committed
to sustainable development but simultaneously engage in harmful business practices.
For example, since the 1970s, the McDonald's Corporation's association with Ronald
McDonald House has been viewed as CSR and relationship marketing. More recently,
as CSR has become main stream, the company has beefed up its CSR programs
related to its labor, environmental and other practices. All the same, in McDonald's
Restaurants v Morris & Steel, Lord Justices Pill, May and Keane ruled that it was fair
comment to say that McDonald's employees worldwide 'do badly in terms of pay and
conditions' and true that 'if one eats enough McDonald's food, one's diet may well
become high in fat etc., with the very real risk ofheart disease.'
Royal Dutch Shell has a much-publicized CSR policy and was a pioneer in triple bottom
line reporting, but this did not prevent the 2004 scandal concerning its misreporting ofoil
reserves, which seriously damaged its reputation and led to charges of hypocrisy. Since
then, the Shell Foundation has become involved in many projects across the world,
including a partnership with Marks and Spencer(UK) in three flower and fruit growing
communities across Africa.
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Critics concerned with corporate hypocrisy and insincerity generally suggest that better
governmental and international regulation and enforcement, rather than voluntary
measures, are necessary to ensure that companies behave in a socially responsible
manner. A major area of necessary international regulation is the reduction of the
capacity of corporations to sue states underinvestor state dispute settlement provisions
in trade or investment treaties if otherwise necessary public health or environment
protection legislation has impeded corporate investments. Others, such as Patricia
Werhane, argue that CSR should be considered more as a corporate moral
responsibility, and limit the reach of CSR by focusing more on direct impacts of the
organization as viewed through a systems perspective to identify stakeholders. For a
commonly overlooked motive for CSR, see also Corporate Social Entrepreneurship,
whereby CSR can also be driven by employees' personal values, in addition to the more
obvious economic and governmental drivers.
Principles of Corporate Social Responsibility
The main principles involving corporate social responsibility
involve economic, legal, ethical and discretionary aspects. A corporation needs to
generate profits, while operating within the laws of the state. The corporation also needs
to be ethical, but has the right to be discretional about the decisions it makes. Levels of
corporate social responsiveness to an issue include being reactive, defensive,
responsive and interactive. All terms are useful in issues management. Selecting when
and how to act can make a difference in the outcome of the action taken.
Ethical consumerism
The rise in popularity ofethical consumerism over the last two decades can be linked tothe rise of CSR. As global population increases, so does the pressure on limited natural
resources required to meet rising consumer demand. Industrialization, in many
developing countries, is booming as a result of both technology and globalization.
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Consumers are becoming more aware of the environmental and social implications of
their day-to-day consumer decisions and are therefore beginning to make purchasing
decisions related to their environmental and ethical concerns. However, this practice is
far from consistent or universal.
Globalization and market forces
As corporations pursue growth through globalization, they have encountered new
challenges that impose limits to their growth and potential profits. Government
regulations, tariffs, environmental restrictions and varying standards of what constitutes
"labor exploitation" are problems that can cost organizations millions of dollars. Some
view ethical issues as simply a costly hindrance, while some companies use CSRmethodologies as a strategic tactic to gain public support for their presence in global
markets, helping them sustain a competitive advantage by using their social
contributions to provide a subconscious level of advertising. (Fry, Keim, Meiners 1986,
105) Global competition places a particular pressure on multinational corporations to
examine not only their own labor practices, but those of their entire supply chain, from a
CSR perspective. that all government is controlling.
Social awareness and education
The role among corporate stakeholders is to work collectively to pressure corporations
that are changing. Shareholders and investors themselves, through socially responsible
investing are exerting pressure on corporations to behave responsibly. The extension of
SRI bodies driving corporations to include an element of ethical investment into their
corporate agendas generates socially embedded issues. The main issue correlates to
the development and overall idea of ethical investing or SRI, a concept that isconstructed as a general social perspective. The problem becomes defining what is
classified as ethical investing. The ethics or values of one SRI body will likely different
from the next since ethical opinions are inherently paradoxical. For example, some
religious investors in the US have withdrawn investment from companies that fail to
fulfill their ethical expectations.
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The Non-governmental organizations are also taking an increasing role, leveraging the
power of the media and the Internet to increase their scrutiny and collective activism
around corporate behavior. Through education and dialogue, the development of
community awareness in holding businesses responsible for their actions is
growing.[36]In recent years, the traditional conception of CSR is being challenged by the
more community-conscious Creating Shared Value concept (CSV), and several
companies are refining their collaboration with stakeholders accordingly.
Ethics training
The rise of ethics training inside corporations, some of it required by government
regulation, is another driver credited with changing the behavior and culture ofcorporations. The aim of such training is to help employees make ethical decisions
when the answers are unclear. Tullberg believes that humans are built with the capacity
to cheat and manipulate, a view taken from Trivers (1971, 1985), hence the need for
learning normative values and rules in human behavior. The most direct benefit is
reducing the likelihood of "dirty hands", fines and damaged reputations for breaching
laws or moral norms. Organizations also see secondary benefit in increasing employee
loyalty and pride in the organization. Caterpillarand Best Buy are examples of
organizations that have taken such steps.
Increasingly, companies are becoming interested in processes that can add visibility to
their CSR policies and activities. One method that is gaining increasing popularity is the
use of well-grounded training programs, where CSR is a major issue, and business
simulations can play a part in this.
One relevant documentary isThe Corporation, the history of organizations and their
growth in power is discussed. Corporate social responsibility, what a company does in
trying to benefit society, versus corporate moral responsibility (CMR), what a company
should morally do, are both important topics to consider when looking at ethics in CSR.
For example, Ray Anderson, in The Corporation, takes a CMR perspective in order to
do what is moral and he begins to shift his company's focus towards the biosphere by
utilizing carpets in sections so that they will sustain for longer periods.
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This is Anderson thinking in terms of Garret Hardin's "The Tragedy of the Commons,"
where if people do not pay attention to the private ways in which we use public
resources, people will eventually lose those public resources.
Geography
In a geographical context, CSR is fundamentally an intangible populist idea without a
conclusive definition. Corporations who employ CSR behaviors are empirically
dissimilar in various parts of the world. The issue of CSR diversity is produced through
the perpetual differences embedded in the social, political, cultural, and economic
structures within individual countries. The immense geographical separations feasibly
contribute to the loosely defined concept of CSR and difficulty for corporate regulation.
Public policies
CSR has inspired national governments to include CSR issues into their national public
policy agendas. The increased importance driven by CSR, has prompted governments
to promote socially and environmentally responsible corporate practices. Over the past
decade governments have considered CSR as a public issue that requires national
governmental involvement to address the very issues relevant to CSR. The heightened
role of government in CSR has facilitated the development of numerous CSR programs
and policies. Specifically, various European governments have implemented public
policies on CSR enhancing their competence to develop sustainable corporate
practices. CSR critics such as Robert Reich argue that governments should set the
agenda for social responsibility by the way of laws and regulation that will allow a
business to conduct themselves responsibly. Actors engaged in CSR:
governments
corporations
civil societies
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Recently, 15 European Union countries have actively engaged in CSR regulation and
public policy development.[42]Recognizably, the CSR efforts and policies are vastly
different amongst countries resultant to the complexity and diversity of governments,
corporations, and civil societies roles. Scholars have analyzed each body that
promotes CSR based policies and programs concluding that the role and effectiveness
of these actors are case-specific. Global issues so broadly defined such as CSR
generate numerous relationships between the different socio-geographic players.
A key debate in CSR is determining what actors are responsible to ensure that
corporations are behaving in a socio-economic and environmentally sustainable
manner.
Regulation
The issues surrounding corporate regulation pose several problems. The concept of
regulation is inherently difficult to address because of the numerous amount of
corporations that exist are vastly dissimilar in terms of corporate behavior and nature.
Thus, regulation in itself is unable to cover every aspect in detail of a corporation's
operations. For example, This leads to burdensome legal processes bogged down in
interpretations of the law and debatable grey areas (Sacconi 2004). For
example, General Electric failed to clean up the Hudson Riverafter contaminating it with
organic pollutants. The company continues to argue via the legal process on
assignment of liability, while the cleanup remains stagnant. (Sullivan & Schiafo 2005).
Government regulation or public institutional regulation is difficult to achieve. Depending
on the political regime and form of government
democracy, parliamentary, presidential issues of governmental ineffectiveness may
transpire. As a result, attempts at CSR policy development and implementation may be
unattainable.
The second issue is the financial burden that regulation can place on a nation's
economy. This view shared by Bulkeley, who cites the Australian federal government's
actions to avoid compliance with the Kyoto Protocol in 1997, on the concerns of
economic loss and national interest.
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The Australian government took the position that signing the Kyoto Pact would have
caused more significant economic losses for Australia than for any other OECD nation.
On the change of government following the election in November 2007, Prime
MinisterKevin Rudd signed the ratification immediately after assuming office on 3
December 2007, just before the meeting of the UN Framework Convention on Climate
Change. Critics of CSR also point out that organizations pay taxes to government to
ensure that society and the environment are not adversely affected by business
activities.
The government of Canada has adopted a national position that expects Canadian
corporations to practice behaviors parallel to CSR. In 2007, Prime Minister Harperwas
aware of Canadas abundant investment into the resource/mineral extractive sector and
encouraged the Canadian mining companies to meet Canadas newly developed CSR
standards and expectations. The method of developing and implementing CSR policies
was achieved through government-company consultation and government stakeholder
cooperation. The successful relationship between the CSR actors within Canadas
government and coutry, may advocate that cooperation amongst constituencies is the
most imperative element to CSR regulation.
The European Union has recently done extensive work to try and find the best form of
regulation. Some critics argue that the creation of a CSR organization with a
democratically appointed minister focused solely on monitoring and enforcing socially
responsible behaviour will be extremely effective.
Laws
The laws legally binding the corporations behavior and activity are quite insignificant in
relation to the global consequences. Only recently have countries included CSR policiesin government agendas legislature. Common types of countries who have implemented
legislation and CSR laws generally consist of socio-economic and politically
sophisticated countries. The level of political stability and effectiveness is inextricably
linked to a countries capacity to ensure national CSR policies.
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The increasing ability and influence corporations have on the economic, political, and
social dynamics of society correlate to the recent studies by the UN Commission on
Human Rights. More research and international political instruments are being explored
to protect and prevent corporations from violating human rights.
Denmark has a law on CSR. On 16 December 2008, the Danish parliament adopted a
bill making it mandatory for the 1100 largest Danish companies, investors and state-
owned companies to include information on corporate social responsibility (CSR) in their
annual financial reports. The reporting requirements became effective on 1 January
2009.[46]The required information includes:
information on the companies policies for CSR orsocially responsible
investments (SRI)
information on how such policies are implemented in practice, and
information on what results have been obtained so far and management
expectations for the future with regard to CSR/SRI.
CSR/SRI is still voluntary in Denmark, but if a company has no policy on this it must
state its positioning on CSR in their annual financial report. More on the Danish law can
be found at CSRgov.dk
Crises and their consequences
Often it takes a crisis to precipitate attention to CSR. One of the most active stands
against environmental mismanagement is the CERES Principles that resulted after
the Exxon Valdez incident in Alaska in 1989 (Grace and Cohen 2006). Other examples
include the lead poisoning paint used by toy giant Mattel, which required a recall of
millions of toys globally and caused the company to initiate new risk management and
quality control processes. In another example, Magellan Metals in the West Australian
town of Esperance was responsible for lead contamination killing thousands of birds in
the area. The company had to cease business immediately and work with independent
regulatory bodies to execute a cleanup.
http://en.wikipedia.org/wiki/UN_Commission_on_Human_Rightshttp://en.wikipedia.org/wiki/UN_Commission_on_Human_Rightshttp://en.wikipedia.org/wiki/Denmarkhttp://en.wikipedia.org/wiki/Corporate_social_responsibility#cite_note-46http://en.wikipedia.org/wiki/Corporate_social_responsibility#cite_note-46http://en.wikipedia.org/wiki/Corporate_social_responsibility#cite_note-46http://en.wikipedia.org/wiki/Socially_responsible_investmentshttp://en.wikipedia.org/wiki/Socially_responsible_investmentshttp://www.csrgov.dk/sw51190.asphttp://en.wikipedia.org/wiki/Coalition_for_Environmentally_Responsible_Economieshttp://en.wikipedia.org/wiki/Exxon_Valdezhttp://en.wikipedia.org/wiki/Lead_poisoninghttp://en.wikipedia.org/wiki/Mattelhttp://en.wikipedia.org/wiki/Magellan_Metalshttp://en.wikipedia.org/wiki/Magellan_Metalshttp://en.wikipedia.org/wiki/Mattelhttp://en.wikipedia.org/wiki/Lead_poisoninghttp://en.wikipedia.org/wiki/Exxon_Valdezhttp://en.wikipedia.org/wiki/Coalition_for_Environmentally_Responsible_Economieshttp://www.csrgov.dk/sw51190.asphttp://en.wikipedia.org/wiki/Socially_responsible_investmentshttp://en.wikipedia.org/wiki/Socially_responsible_investmentshttp://en.wikipedia.org/wiki/Corporate_social_responsibility#cite_note-46http://en.wikipedia.org/wiki/Denmarkhttp://en.wikipedia.org/wiki/UN_Commission_on_Human_Rightshttp://en.wikipedia.org/wiki/UN_Commission_on_Human_Rights -
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Odwalla also experienced a crisis with sales dropping 90%, and the company's stock
price dropping 34% due to several cases ofE. coli spread through Odwalla applejuice.
The company ordered a recall of all apple orcarrotjuice products and introduced a new
process called "flash pasteurization" as well as maintaining lines of communication
constantly open with customers.
Stakeholder priorities
Increasingly, corporations are motivated to become more socially responsible because
their most important stakeholders expect them to understand and address the social
and community issues that are relevant to them. Understanding what causes are
important to employees is usually the first priority because of the many interrelatedbusiness benefits that can be derived from increased employee engagement. Key
external stakeholders include customers, consumers, investors (particularly institutional
investors), communities in the areas where the corporation operates its facilities,
regulators, academics, and the media.
Branco and Rodrigues (2007) describe the stakeholder perspective of CSR as the
inclusion of all groups or constituents (rather than just shareholders) in managerial
decision making related to the organizations portfolio of socially responsible
activities. This normative model implies that the CSR collaborations are positively
accepted when they are in the interests of stakeholders and may have no effect or be
detrimental to the organization if they are not directly related to stakeholder interests.
The stakeholder perspective suffers from a wheel and spoke network metaphor that
does not acknowledge the complexity of network interactions that can occur in cross
sector partnerships. It also relegates communication to a maintenance function, similar
to the exchange perspective.
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HISTORICAL BACKGROUND
In the late 18th century a Scottish philosopher and economist named Adam Smith wrote
numerous articles on these subjects, his magnum opus being The Wealth of Nations in
which he espoused the concepts of free trade and the free market on which the classic
market economy was based.
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Smiths principles were borne out. By the early 19th Century, new technology saw jobs
being created and living standards improved. Unchecked by regulation businesses
flourished and industrialists in Europe and the USA amassed huge fortunes.
However few of these wealthy new industrialists were concerned about the wellbeing of
their employees, society or the environment. The appalling conditions under which
people worked were documented in the novels of Charles Dickens and inspired radical
theorists such as Karl Marx and Friedrich Engels to write about new concepts on labour,
socialism and communism.
By the start of the 20th century, powerful corporations suffered a backlash against their
widespread exploitation. Labour unions were formed, giving a voice to the workers, and
governments began to assume more responsibility for welfare and infrastructure,
gradually introducing anti-trust legislation.
In the 1950s, emerging consumer power saw companies start taking a new interest in
the social and human aspects of their markets it was at about this time scientists and
environmentalists started noticing some worrying changes to the environment.
The 1960s saw a shift in attitudes towards government and business. In 1962 Professor
Milton Friedman, Nobel Prize-winning economist, published his controversial Capitalism
and Freedom. In it he makes the case for economic freedom as a precondition for
political freedom.
The 1980s and 1990s saw communism collapse, globalization emerge and the
information revolution change the way the world did business. As globalization
intensified, so did environmental awareness and the emergence of responsible
business practice. Key developments include: the Brundtland Commission, the
formation of the World Business Council for Sustainable Development, and the United
Nations Global Compact.
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CURRENT STATE OF THE FIELD
By any count, the world is changing faster than ever before. Human numbers are
growing faster, and the impact of our activities is being felt in more and more ways. This
change has profound implications for business, and means that the world of CSR - or
how businesses respond to society's expectations - is at the forefront of this change. So
it's worth looking for what are the current trends and where are they heading.
What drives trends in an area like CSR?
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Three things.
One - attitudes to business and its relationship with society are changed and shaped by
outside events. These can be demonstrations of social problems that substantially
change the environment within which companies do business, which are partially or
wholly caused by business activities, or which businesses are likely partners in finding
solutions.
These can be as diverse as extreme climate events raising the profile and public
concern about climate change, right through to a run of incidences of corporate
corruption. Businesses are called upon to change behaviours or solve problems
because of something external to them.
Two - expert practitioners have a vision for how sustainable business should operate,
and develop new ideas, or increase expertise on past experience, and implement these
within the business. This defines how businesses focus their attention when the
spotlight isn't particularly on them. Do they define CSR as being about philanthropy, or
environmental management, or core purpose and the business model?
Three - outside agencies create a vision for the achievement of future goals, and
actively recruit businesses and partners. So in recent years, the involvement of
businesses in finding ways to meet the millenium development goals has been an
example.
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The Top 10 Trends in CSR for 2012
1. Going Global: The relentless march toward globalization will continue to stretch the
scope of corporate responsibility. For instance, the new conflict minerals requirement in
the Dodd-Frank Financial Reform Act breaks new ground for the scope of corporate
responsibility, by requiring many types of businesses to track four minerals back to their
sources to ensure they dont fuel conflict in the minefields of Central Africa. As this and
similar requirements arise, the trend is clear: Corporate social responsibility leaders will
be increasingly accountable for responsible behavior all along their supply chains.
2. The Triumph (or Tyranny) of Transparency: The pressure for ever increasing
levels of transparency and disclosure will build in 2012. Last year, according to
CorporateRegister.com, more than 5,500 companies around the world
issued sustainability reports, up from about 800 a decade ago. Also, the Rate the
Raters report from confound that more than 100 sets of ratings measure which
companies are the most responsible. All the big four accounting firms are expanding
their practices to audit all of these disclosures and are also sponsoring the expanded
fourth edition of the Global Reporting Initiative Guidelines, which outline
standard CSR disclosures. In 2012 a promising new initiative, the Global Initiative forSustainability Ratings, will endeavor to standardize the ratings framework, but beyond
that there is little relief in sight for the survey-fatigued CSR manager.
3. Employee Engagement Emerges: The connection between CSR and engaged
employees continues to grow. A Hewitt & Associates study looked at 230 workplaces
with more than 100,000 employees and found that the more a company actively
pursues worthy environmental and social efforts, the more engaged its employees are.
The Society for Human Resources Management compared companies that have strong
sustainability programs with companies that have poor ones and found that in the
former morale was 55% better, business process were 43% more efficient, public
image was 43% stronger, and employee loyalty was 38% better.
http://www.corporateregister.com/stats/http://www.corporateregister.com/stats/http://www.forbes.com/companies/csr/?lc=int_mb_1001http://www.forbes.com/companies/csr/?lc=int_mb_1001http://was2.hewitt.com/bestemployers/canada/pdfs/HewittTheGreen30_eng.pdfhttp://www.shrm.org/Research/SurveyFindings/Articles/Pages/AdvancingSustainabilityHR%E2%80%99sRole.aspxhttp://www.shrm.org/Research/SurveyFindings/Articles/Pages/AdvancingSustainabilityHR%E2%80%99sRole.aspxhttp://was2.hewitt.com/bestemployers/canada/pdfs/HewittTheGreen30_eng.pdfhttp://www.forbes.com/companies/csr/?lc=int_mb_1001http://www.forbes.com/companies/csr/?lc=int_mb_1001http://www.corporateregister.com/stats/http://www.forbes.com/sites/forbesleadershipforum/2012/01/18/the-top-10-trends-in-csr-for-2012/#undefinedhttp://www.forbes.com/sites/forbesleadershipforum/2012/01/18/the-top-10-trends-in-csr-for-2012/#undefinedhttp://www.forbes.com/sites/forbesleadershipforum/2012/01/18/the-top-10-trends-in-csr-for-2012/#undefinedhttp://www.forbes.com/sites/forbesleadershipforum/2012/01/18/the-top-10-trends-in-csr-for-2012/#undefined -
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4. Political Pitfalls: The elections will dominate the public conversation in the U.S. in
2012, and corporations will be alternately described as greedy, polluting, untrustworthy
political puppet masters and job-creating paragons of virtuewith little room in the
middle. Beyond the rhetoric, candidates wont be able to resist highlighting company
success stories featuring economic, environmental and social benefits. CSR leaders
should choose what they promote wisely and set clear boundaries to avoid becoming
political footballs.
5. Collaboratition:As CSR becomes more of a differentiator, companies will both
compete and collaborate on CSR issues. I devised the term collaboratition in a 2011
speech to describe how companies both compete and collaborate on CSR at the same
time. The numerous CSR ratings, together with data from the Reputation Institutes
2011Pulse Survey,which indicate that CSR is responsible for more than 40% of a
companys reputation, lay the basis for CSR competition. On the other hand, there are a
plethora of associations and multi stakeholder networks that foster collaboration on
CSR topics. Groups like the Electronics Industry Citizenship Coalition demonstrate how
competitors can partner on CSR issues like conflict minerals. Why would they? Such
issues are so massive that working together is clearly more efficient.
On the other end of the spectrum are initiatives likeGEs ecomaginationprogram, which
furthers competitive advantage. Collaboratition means that companies can and will
collaborate on CSR efforts when that is more efficient, while continuing to compete on
their signature CSR programs.
6. Sustainability Shoppers: Consumers are increasingly tuned in to sustainability
when making their buying decisions. Green labels have been around for a long time,
but Wal-Marts sustainability index is taking it up a notch. Already driving WMT
suppliers to improve performance, in the future the index could appear on a point-of-
sale label for products. Expect green marketing in 2012 to up the ante based on the
successes of campaigns likeTimberlands Earthkeepers line(Nature Needs Heroes).
Perhaps the high water mark for eco-minded advertising was Patagonias brilliantDont
Buy This Jacketmessaging.
http://www.forbes.com/companies/csr/?lc=int_mb_1001http://www.reputationinstitute.com/advisory-services/reptrak-in-country.phphttp://www.reputationinstitute.com/advisory-services/reptrak-in-country.phphttp://www.reputationinstitute.com/advisory-services/reptrak-in-country.phphttp://www.ecomagination.com/http://www.ecomagination.com/http://www.ecomagination.com/http://walmartstores.com/sustainability/9292.aspxhttp://earthkeepers.timberland.com/http://earthkeepers.timberland.com/http://www.patagonia.com/email/11/112811.htmlhttp://www.patagonia.com/email/11/112811.htmlhttp://www.patagonia.com/email/11/112811.htmlhttp://www.patagonia.com/email/11/112811.htmlhttp://www.patagonia.com/email/11/112811.htmlhttp://www.patagonia.com/email/11/112811.htmlhttp://earthkeepers.timberland.com/http://walmartstores.com/sustainability/9292.aspxhttp://www.ecomagination.com/http://www.reputationinstitute.com/advisory-services/reptrak-in-country.phphttp://www.forbes.com/companies/csr/?lc=int_mb_1001 -
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Its Common Threads Initiative asks customers to pledge to only buy what they need
and instead repair, reuse, and recycle their clothing. Nothing inspires confidence in your
eco-values more than telling customers not to buy your products. Independent
certification schemes like the GoodGuide will continue to proliferate, as will cause
marketing, for the simple reason that it works. Cone Communications reports in its
2010 Cause Evolution Study that even as cause marketing continues to grow,
consumers are eager for more. In fact, 83 percent of Americans want MORE of the
products, services and retailers they use to support causes.
7. Occupy From the Inside: Price Waterhouse Coopers has found that 88% of
millennials, or echo boomers, choose employers based on strong CSR values, and
86% would consider leaving if the companies CSR values no longer met their
expectations. As a new generation goes to work in corporate America, it is bringing
strong social justice values with it. At the same time, companies are under increasing
pressure to go green. So despite the popular view that corporations are in a race to
the bottom, 2012 will see more jobs created for CSR professionals who want to change
business from the inside out.
Companies of all kinds are looking for people to help improve their environmental,
social, and ethical performance throughout their value chains. There are recruiters
like Ellen Weinreb and Martha Montag Brownwho specialize in CSR jobs, and the big
recruiters have caught on too.
8. Social Media Rules: I will admit that I originally got a Facebook account just to
annoy my children. Now Facebook and Twitter are essential communications tools for
any serious CSR program. Social media is not a replacement for hefty annual CSR
reports, but those reports are increasingly static reference documents, used mainly for
looking up facts and grading performance. Social media opens a way for stakeholders
to interact directly with a companys CSR program. Through social media, companies
gain a following of people who are interested in their CSR performance and can keep
tabs on stakeholder sentiment on any emerging issue.
http://www.patagonia.com/us/common-threadshttp://www.goodguide.com/http://www.coneinc.com/research/archive.phphttp://www.pwc.com/gx/en/managing-tomorrows-people/future-of-work/pdf/mtp-millennials-at-work.pdfhttp://weinrebgroup.com/http://www.marthamontagbrown.com/about.htmlhttp://www.forbes.com/social-media/http://www.forbes.com/social-media/http://www.marthamontagbrown.com/about.htmlhttp://weinrebgroup.com/http://www.pwc.com/gx/en/managing-tomorrows-people/future-of-work/pdf/mtp-millennials-at-work.pdfhttp://www.coneinc.com/research/archive.phphttp://www.goodguide.com/http://www.patagonia.com/us/common-threads -
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9. Human Rights: Since the 2008 publication of theRuggie Reporton human rights
and transnational corporations, companies have been waking up to human rights issues
across their value chains. For example, the major Internet search companies are
embroiled in basic human rights questions ranging from the protection of free speech
during the Arab Spring to being compelled to identify dissidents in repressive regimes.
In a time of globalization, hyper-transparency, and increasing expectations among
informed stakeholders, the risk in even tacit complicity in human rights violations is
growing. Wise companies will take a hard look at their human rights policies and
practices in 2012 and act to mitigate any liabilities.
10. Earth at Seven Billion and Growing: In 2011 theworlds population topped seven
billion people. Even at seven billion we have averted a Malthusian catastropheso far.
But as more people compete for the Earths resources, the need to be more efficient will
continue to increase. Everything from energy efficient semiconductors to electric cars to
water conserving plants will find new markets in 2012 and beyond. The imperative to
stretch resources ever further will make sustainability a central design principle for the
winning corporations of the future.
http://www.reports-and-materials.org/Ruggie-report-7-Apr-2008.pdfhttp://www.reports-and-materials.org/Ruggie-report-7-Apr-2008.pdfhttp://www.reports-and-materials.org/Ruggie-report-7-Apr-2008.pdfhttp://www.msnbc.msn.com/id/44990504/ns/us_news-life/t/seven-big-problems-billion-people/#.TvH0nWPNltMhttp://www.msnbc.msn.com/id/44990504/ns/us_news-life/t/seven-big-problems-billion-people/#.TvH0nWPNltMhttp://www.msnbc.msn.com/id/44990504/ns/us_news-life/t/seven-big-problems-billion-people/#.TvH0nWPNltMhttp://www.msnbc.msn.com/id/44990504/ns/us_news-life/t/seven-big-problems-billion-people/#.TvH0nWPNltMhttp://www.msnbc.msn.com/id/44990504/ns/us_news-life/t/seven-big-problems-billion-people/#.TvH0nWPNltMhttp://www.reports-and-materials.org/Ruggie-report-7-Apr-2008.pdf -
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CHAPTER-2
OBJECTIVES
- TO KNOW WHAT IS CSR (CORPORATE SOCIAL RESPONSIBILITY)
- TO KNOW ABOUT WHAT IS BANKING AND INSUARNCE SECTOR AND
HOW IT WORKS.
- CSR ACTIVITIES DONE BY CORPORATES
- WHAT ARE THE RECENT TRENDS IN CSR
- AND WHAT IS THE CONTRIBUTION OF BANKING AND INSURANCE
SECTOR IN CSR
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CHAPTER-3
RESEARCH METHODOLOGY
INTRODUCTION TO RM
Marketing research is the function which likes the consumers, customers & public to
the marketer through information which is used to identify & define marketing
opportunities & problems, generate, refine & evaluate marketing action; monitor
marketing performances & improve understanding of marketing as a process.
It has following steps: