CSR CSR (Part 2)

Question 1

Define corporate social responsibility (CSR)

Answer 1

Is a company’s commitment to manage the social, environmental and economic effects of its operations responsibly and in line with public expectations.

i.e. reducing carbon footprint, participating in Fairtrade etc.

Question 2

What are the 4 in the pyramid of corporate social responsibility?

Answer 2

Economic - Be profitable
Legal - Obey the law
Ethical - Right, just, & fair (avoid harm)
Philanthropic - Be a good corporate citizen (contribute resources to the community/improve quality of life)

Question 3

Define ‘Triple Bottom Line’

Answer 3

Is an accounting framework that incorporates three dimensions of performance: social, environmental and financial.

Dimensions knowns as the 3 P’s: People, Planet, Profit

NOTE: There is no standard auditing procedure

Question 4

What are the biggest challenges?

Answer 4

Be seen to do good
Practice what you preach
Not easy
Has cost implications

Question 5

What are the advantages of CSR?

Answer 5

Customers - additional/ more satisfied customers
HR - Employees attracted/good rep
Avoid legislation
Protect the brand
Brand differentiation
Supplier relations - Believe they behave more ethically
Right thing - CSR policies = long-term benefits

Question 6

What are the additional moral arguments of CSR?

Answer 6

Corporations have a responsibilities to deal with social/environ impacts resulting from their activities

Corporation should use their power and resources responsibly

Take account of the interests of their stakeholders, not just their shareholders

Question 7

What is the difference between stakeholders and shareholders?

Answer 7

Shareholder: Owns part of a public company through shares of stock

Stakeholder: Any person or organisation with a direct interest in the activities and performance of a business. (i.e. investors, employees, customers, suppliers etc.)

Question 8

What is Carroll & Wilson philosophy of social responsiveness of model?

Answer 8

Reaction: Corporation denies any responsibility

Defence: Admits responsibility - does very min required

Accommodation: Accepts responsibility & does what required

Proaction: Seeks to go beyond industry norms & does more than required (to stop it from happening again)