CSR + Criticism

Question 1

What is corporate social responsibility?

Answer 1

• Originates from Friedman 1970 shareholder theory, closely linked to business ethics
• Bowen (1953) “refers to obligations…which are desirable in terms of objectives / values in society”
• CSR is becoming more developed, “CSR begins where the law ends” (Carroll 1999)

Question 2

Define corporate social responsibility

Answer 2

There is no definitive definition, Blomfield and Murray (2008) suggest CSR involves:

• Leadership + Values
• Community + Environment
• Supply chain + Markets
• Stakeholders + Workforce

Question 3

What are the 4 strategies involved with CSR? Explain each strategy.

Answer 3

Clarkson 1995:
Reactive strategy = Reestablish authority / credibility due to event which diminishes authority / credibility.

Accomodative strategy = Suppress / change stakeholder requirements. Companies change CSR as stakeholders demand.

Defensive strategy = Forecast stakeholder behaviour and adjust strategy to requirements. Avoids extra obligations especially with unions + governments.

Proactive strategy = Company uses own influence to gain benefits and competitive advantage. Continuous communication + cooperation needed with stakeholders

Question 4

What are the CSR initiatives?

Answer 4

Kotler 2005:

• Cause promotion
• Cause or social responsibility marketing
• Corporate philanthropy
• Community volunteering
• Socially responsible business practice

Question 5

What are the approaches to CSR and stakeholder engagement?

Answer 5

Approach one - 1. Neo-Liberal perspective
- Businesses main priority are the owners and shareholders. The business operates on an economical basis.

Approach two - 2. Stakeholder perspective
- Businesses are responsible to anyone in which they depend on for survival. The business operates on an economical and social basis.

Question 6

What are the criticisms of CSR?

Answer 6

• An organisations one social responsibility of a business is to use resources + engage in activities that boost profits
• CSR that is not profit-maximising can be unethical

Question 7

What are the issues of CSR for SMEs?

Answer 7

• Resources involved
• Lack of information + consultancy
• Difficult to measure benefits
• Immediate evidence for implementing CSR is limited

Question 8

What are the four CSR strategies?

Answer 8

Clarkson (1995): 
Reactive strategy 
Accommdative strategy 
Defensive strategy 
Proactive strategy

Question 9

What is the stakeholder perspective?

Answer 9

• Focuses on socio-economical perspective on organisations
• Stakeholders are not meant to achieve the organisations objectives
• Organisations are within a larger system that include market / non-market parties

Question 10

What is the process in identifying stakeholders?

Answer 10

Freeman (1984)

1. Identify relevant stakeholders
2. Determine the importance of each stakeholder group
3. Identify if stakeholders expectations are achieved
4. Modify priorities / procedures in order to satisfy stakeholder needs (decide what stakeholders interests are most important)