Chapter 6 -CSI & CSR Flashcards
1
Q
Define social responsibility
A
An ethical view point that says every individual/organisation has an obligation to benefit society as a whole.
2
Q
Explain the relationship/link between social responsibility and triple bottom line.
A
Profit/ Economic
- Triple Bottom line means that businesses should not only focus on profit/charge high prices but should also invest in CSI projects.
- Businesses should not make a profit at the expense of its community and employees.
People/ Social
- Business operations should not have a negative impact on/exploit people/employees/ customer.
- Businesses should engage/invest in sustainable community programmes/projects that will benefit/uplift communities.
- Improve the life style/quality of life of their human resources/employees.
Planet/ Environment
- Businesses should not exhaust resources/harm the environment for production purposes.
- They may support energy-efficient/eco-friendly products/programmes.
- Recycle/Re-use waste e.g. packaging from recycled material
3
Q
Social Responsibility
Suggest ways in which a business project can contribute towards the community
A
- charitable contributions to NGO’s,
- involvement in community education,
- employment,
- employee volunteer programmes
4
Q
Identify socio-economic issues that challenge social responsibility
A
- HIV/Aids,
- unemployment,
- poverty,
- human rights aspects
5
Q
Recommend/Suggest ways in which businesses can deal with the mentioned socio-economic issues:
HIV/Aids, unemployment, poverty, human rights aspects
A
HIV/ AIDS
South Africa has one of the highest HIV-prevalence rates in the world and the infrastructure to deal with this problem is lacking
- Although businesses are making a contribution, the effects of HIV/Aids are overwhelming:
- Children become orphans when their parents die
- These children, often very young, drop out of school because they simply cannot cope with running a household and going to school
- Parents can’t take care of their children in the final stages of the disease
- Employees who live with HIV/Aids are absent more often
Unemployment
- Although government has devised several strategies to address unemployment, it is still a very big problem
- Businesses contribute towards solving this problem by offering learnerships to unemployed people
- However, in many businesses there are simply not enough positions available for businesses to make a significant contribution
Poverty
- Many businesses try to alleviate poverty by donating clothes or other valuable items to underprivileged communities
- Although these contributions are extremely helpful, it is not really addressing the root of the problem
6
Q
Explain how businesses can contribute time and effort in improving the well-being of the following stakeholders:
- Employees
- Community
A
Contribution of time and effort in improving the wellbeing of the communities
- Businesses should improve the general quality of life of employees’ families in their community, e.g. develop skills in the community/invest in education, etc.
- Ensure that the product they supply do not harm consumers/the environment.
- Refrain from engaging in illegal/harmful practices such as employing children under the legal age/selling illegal substances, etc.
- Make ethically correct business decisions, e.g. not engage in unfair/misleading advertising, etc.
- Participate in community projects involving HIV/AIDS/education/counselling/ other meaningful causes.
- Donate money to a community project/run a project to uplift the community.
- Provide recreational/sport facilities to promote social cohesion/healthy activities.
Other ways a business can contribute to the wellbeing of their employees
- The business should improve the general quality of life of the workforce, their families and the community, e.g. pay fair wages/develop skills in the community/ invest in education etc.
- Ensure that the product they supply do not harm consumers.
- Refrain from engaging in illegal or harmful practices such as employing children under the legal age/selling illegal substances, etc.
- Offer counselling sessions to employees with personal/challenges.
- Give time to staff to get involved in projects they choose/Allow staff to use some of the working hours to participate in the projects of their choice.
- Donate money to a community project/Run a project to uplift the community.
- Provide transport for employees who work unusually long hours
7
Q
Define/Elaborate on the meaning of CSR
A
- CSR is a continuous commitment from a business to act ethically and to contribute to economic development
- CSR implies that businesses recognise the need to give back to society and to behave in a sustainable manner
- CSR includes improving the quality of life for employees of the business, their families, the community in which the business operates and society as a whole
8
Q
Describe/Explain the nature/ purpose of CSR
A
- CSR aims to protect the natural environment in which a business operates
- CSR means not pursuing profit at any cost
- CSR aims to be sustainable
- CSR aims to create safe working environments for employees
- CSR is transparent
- CSR builds a business’s reputation
- CSR is relevant
- SCR is ethical
9
Q
Identify/Name/Outline the components of CSR
A
-
Environment:
- Must take their impact on environment into consideration
- Resources available for future
- Ways (Contribute money aimed at finding alternative sources of energy, Recycle, Use energy saving globes, reduce paperwork by keeping correspondence digital)
-
Ethical Corporate Social Investment
- CSI is an extension of CSR
- CSI mainly focusses on Socio economic issues
- Ethics and CSI are complimentary issues
- Point of CSI is defeated if not implemented ethically
- Ways (Ensure CSI projects have legitimate track records, ensure the purpose of CSI is to benefit the community and not to make profit)
-
Health and Safety
- Business must ensure safety of employees at work and people who visit premises
- Operations must not pose a risk to health of communities
- Ways (adhere to health and safety regulations (Occupational health and safety Act), Provide protective gear, health and safety rep (1 for every 100 employees), regular maintenance on machinery, Emergency plan)
-
Socio-economic development (SED)
- Is closely related to CSI
- SED specifically aimed at promoting access to economy for black people
- 4 elements + ways (Infrastructure development – solar power for communities, Educational development – computers for disadvantages schools, community development – programmes developing art and sport, Healthcare development – HIV Aids programmes)
10
Q
Evaluate/Explain/Discuss the impact of CSR on business
A
Advantages
- Businesses may attract experienced employees/increase the pool of skilled labour which could increase productivity.
- Promotes customer loyalty resulting in increased sales and profit.
- Programmes promote teamwork within businesses.
- CSR/CSI helps to attract investors.
- Gives businesses tax advantages such as tax reduction/rebates.
- It helps to retain staff/lower staff turnover as employees’ health and safety are considered.
- Improves the health of its employees through focussed CSR programmes.
Disadvantages
- Business may not be supported/Customers may not buy their products/services resulting in a decrease in sales.
- Small and medium enterprises find it difficult to implement CSR/CSI programmes.
- Detailed reports must be drawn up, which can be time consuming.
- Social spending reduces business/economic efficiency which makes it less competitive.
- Social involvement is funded from business profits which could have been used to the benefit of customers/reduce prices.
- CSR/CSI activities distract business focus from its core business functions.
- Businesses find it difficult to adhere to legislation governing CSR/CSI.
- It can increase financial risk, as programmes cost money and may impact negatively on profits.
11
Q
Evaluate/Explain/Discuss the impact of CSR on communities.
A
Advantages
- Provide jobs for unemployed members of the communities.
- Employee’s family and/or community members receive bursaries to further their studies.
- Provide rehabilitation centres to employees/community members who have addiction problems.
- Improve the health of workers/communities by providing medical infrastructure.
- Upliftment of the standard of living.
Disadvantages
- Businesses are not always equipped to address social problems.
- Communities can avoid taking responsibility for themselves, because they depend/rely on a business’s CSR/CSI initiatives/Hand-out programmes.
- Distribution of scarce resources to selected beneficiaries in the community may cause problems such as discrimination.
- Some businesses only participate in CSR/CSI initiatives to raise profit and do not really care for the community in which they operate.
- Business cannot deliver sustainable CSR/CSI programmes.
12
Q
· Define/Elaborate on the meaning of CSI
A
- Refers to the projects that are not part of the normal business activities of a business and are designed and aim to benefit the community
- The aim of CSI is not to increase the business’s profits, but to use as businesses resources to benefit the community
13
Q
Describe/Explain the nature/purpose of CSI
A
- CSI contributes towards sustainable development
- CSI is enforceable by law and government requires businesses to make CSI contributions
- CSI plays a positive role in the development of communities
- CSI reveals a business’s attitude towards the community in which it operates
- The main focus of CSI is not to increase profit, but to support communities
- CSI is relevant to the South African context where socio-economic upliftment is such a priority
14
Q
Outline/Name CSI focus areas
A
- Community : Building communities and making sure that basic needs of the communities can be met, for example educational needs, housing needs, medical needs
- Rural development: Starting new businesses or schools in rural areas
- Employees: Looking after employees by paying fair wages and providing safe working conditions
- Environment: Projects like nature conservation
15
Q
Explain/Distinguish/Differentiate between CSR and CSI
A
CORPORATE SOCIAL RESPONSIBILITY(CSR)
- The intention is to change business practices.
- Focus is on increasing image and profits.
- Ensure that all internal CSR policies/ practices include stakeholders’ interests/environmental issues.
- Often intended as a marketing initiative.
- Projects are usually linked to the business, e.g. a manufacturing business offering to train the unemployed.
CORPORATE SOCIAL INVESTMENT
(CSI)
- Actively committing money and resources to uplift the community.
- Focus is on upliftment of community without return on investment.
- Ensure that CSI projects are relevant to the needs of communities.
- Intended to benefit and uplift communities through social development.
- Projects are external to the business and have a strong developmental approach.
