Corporate Social Responsibility: Practices, Theories, And Implications
Introduction and Theoretical Basis
The main purpose of this research proposal is to establish the different corporate social responsibilities (CSR) practices which are followed by different organization and the role they paly in the current market situation. The research will be dealing with different practices which are applied by different organization. In addition to this various theoretical framework will also be analyzed in the research
This research will be focusing on analyzing the following research questions:
- What are the different theories which are closely related with the corporate social responsibilities practices of a business?
- How does effective CSR policies in a business impact a business and its business environment?
The main motivation for conducting this research is to due to increasing emphasis on the corporate responsibilities of the companies towards the society. Corporate Social Responsibility may be referred to the activities which are undertaken by the business in order to respond to the needs of the society which are environmental consideration, social consideration. There is a considerable doubt and many opinions which have been formed regarding the relation which exist between Corporate Social Responsibility and Financial performance of the business. The research will focus on proving role CSR is business success in aspects such as financial performance, customer satisfaction, improved reputation and competitive advantage (Öberseder, Schlegelmilch and Murphy 2013). The research will also address the various theories which is linked with CSR practices in a business. The research will be linking the theories which are associated with the concept of CSR and will also be explaining the role which is played by CSR practices.
The application of CSR practices varies from businesses to businesses due to the different policies which are followed by the businesses in this aspect (Loorbach and Wijsman 2013). Therefore, CSR practices for different businesses are not same and this research will be showing application of CSR practices in different business. In addition to this, the research will be focusing on the on various theories which are linked to the CSR practices and also with the predictions which are made towards CSR motivations (Verbeke and Tung 2013).
The theories which are related to the concept of corporate social responsibilities are legitimacy theory, Stakeholder theory, Institutional theory. All the theories are linked to the CSR framework. The legitimacy theory suggest that all business should work in the bounds and norms of the society (Frynas and Stephens 2015). The theory states that the business and society have a social contract which is related to meeting the expectations of the society and stakeholders of the business. Another theory which will be analyzed in the research is stakeholder’s theory. The stakeholder’s theory sheds light on the relationship between the stakeholders and the business (Servaes and Tamayo 2013). The stakeholder’s theory emphasis on the accountability of the management and also the rights of the stakeholders of the business. This accountability principle of stakeholder theory can be adopted in CSR practices of the business (Grayson and Hodges 2017).
Importance to Practice and Society
The research will aim to analyze how legitimacy theory and stakeholder’s theory can be applied in CSR practices of a business. In the similar way the research aims to shed light on other different theories which can be linked with CSR practices of a business.
In the contemporary global business scenario, with the aspects of social and ethical responsibilities of the business organizations across the globe gaining increasing significance among the businesses as well as different stakeholders, the notion of “Corporate Social Responsibility” has been becoming increasingly popular and there exist substantial scholarly and research works in this aspect (Schwartz 2017). This chapter, tries to conduct an extensive review of the different literary works and scholarly evidences existing in the global framework regarding the different aspects of CSR and its implications on the business organizations.
There exist different perceptions regarding the broad term of “Corporate Social Responsibility” among different scholars across the globe. However, one of the most comprehensive definitions of the term can be seen to be provided in the work of Tai and Chuang (2014), according to whom, the term CSR, is a component of the management and operational framework of the companies, which help the same to integrate the social, humanistic and environmental concerned and the responsibilities which the companies need to take as a social entity, in the different business operations and stakeholder interactions on part of the companies (Malik 2015). In this context, referring to the “Triple Bottom Line Approcah”, Elkington (2013), asserts that CSR, in the contemporary global commercial and organizational scenario, is the way by which the business institutions maintain balance of the environmental, social as well as the economic imperatives.
The term “Corporate Social Responsibility”, as discussed above, being a broad and multi-lateral concept, has various components, as perceived by the different scholars across the globe. In this context, Brown, J.A. and Forster (2013), highlights and discusses about the four primary components of Corporate Social Responsibility, in e generalised organizational framework, to be as follows:
Economic Component of CSR- The first and foremost component of the CSR, according to the authors is the economic component which indicates towards the primary responsibility of any business of being economic profitability. A business can only be able to contribute to other sectors and aspects of a society or a community when it is itself sustainable and profitable. Kolk (2016), in this context, refers to a profitable business to be one which has the ability to make profit for all its stakeholders and to pay appropriate wages to the employees and taxes to the government of the countries, thereby fulfilling its financial obligations.
Research Questions
Legal Components of CSR- As per the assertions of Carroll (2015), another crucial responsibility of any business is to abide by the laws and regulations present in the economy and society as a whole in the places of their operations, which include the law-abiding actions like that of paying taxes timely, following labour laws and allowing inspections of their operations, which according to the author, leads to increased consumer trust.
Ethical Components of CSR- This aspect of the CSR, induces the sense of right and wrong in the operational framework of the companies, thereby compelling them to choose the right paths and actions in all levels of their activities, even at the cost of some of its monetary and short-term profits (Bank 2012).
Discretionary Components of CSR- Bank (2012), also points towards the discretionary responsibilities of the businesses of that of using the resources and time of the companies in order to contribute to different welfare increasing and social developmental aspects in the community where they venture or other communities, thereby participating in the cause in which the companies believe.
The implementation of CSR frameworks in the operational activities of the business institutions across the globe can lead to farfetched benefits for the businesses, thereby indicating towards the immense significance of the same in the contemporary global organizational scenarios. The primary significances and benefits of CSR in the businesses, as put forward by Bowie (2012) are as follows:
- Robust relationships with stakeholders-As per the author, the presence of strong CSR frameworks in the companies help in building robust relationships of the companies with different stakeholders as string CSR enables the companies to fulfil the interests of the stakeholders.
- Attracting customers-A company with strong CSR operations, gain positive reputations and goodwill in the markets, thereby attracting more customers, which in turn increases its profitability, competitiveness and long-term sustainability.
- Positive impacts on community and society- The actions and steps taken by the companies in the aspects of societal development and addressing various community-related causes of concerns, increases the overall welfare of the society, including the welfare of also those who are not directly related to the operations of the companies (Ni and Van Wart 2015).
- Motivations of the employees-Ni and Van Wart (2015), also assert that a company with string CSR, looks into both personal and professional welfare of its employees, thereby motivating them to work with more dedication and loyalty for the concerned companies, benefitting both the employers as well as the employees.
The hypothesis which will be considered in this research are on the basis of Null hypothesis (H0) and the Alternative Hypothesis (H1). There is impact of CSR practices of the business in business performance will be considered to be H0 and similarly there is no impact of CSR practices in a business performance is considered to be H1.
The research will be considering theoretical framework of analysis and very little or no empirical study will be included in the research. The information which will be included in the research will be generally descriptive in nature and will be containing studies and research analysis of different author’s as well.
References
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Carroll, A.B., 2015. Corporate social responsibility. Organizational dynamics, 44(2), pp.87-96.
Elkington, J., 2013. Enter the triple bottom line. In The triple bottom line (pp. 23-38). Routledge.
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