Corporate Social Responsibility In International Marketing Commerce Essay

Published: Last Edited:

This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.

With globalization, corporate social responsibility (CSR) has become an important theme around the world. Consumer organizations increasingly demand information about production conditions and routes to market. Non- governmental organizations (NGOs) and trade unions approach companies with requests and demands regarding their commitment to society. Lastly, politicians have also discovered CSR as an area for policy-making and international organizations such as the European Commission are considering standardization and regulation. In some sectors CSR has already become a factor for companies' competitiveness. Depending on sector and size, demonstrating social responsibility can benefit a business and form part of its strategic orientation in areas such as safeguarding innovative capacity, improving risk management and strengthening its market position.

Corporate social responsibility, or CSR, is a corporation's obligation to its stakeholders, which are any groups/people that have a stake or interest in a company's success and products. This includes customers, employees, suppliers, investors and the communities surrounding the business. Stakeholders have varying needs to be met. Whereas a customer's greatest concern may be the safety of a company's products, an employee's need might be for a fair wage and safe working conditions. An investor may be concerned with profits and the bottom line, while the community may care about a business limiting the pollution it causes. Thus, corporate social responsibility means maximizing the good and minimizing the bad effects your company has on these stakeholders' diverse interests.

The term corporate social responsibility (CSR) first appeared in the late 1960s in reaction to the global challenges, such as climate change, financial crises, multiplying trade and investments, that started to evolve in the international sphere. Companies have begun to realize that besides gaining economic profit they must take responsibility and incorporate actions into their business models to solve local or even global problems and improve social well-being.

CSR initiatives are the contributions that companies make in areas where they interact with wider society in the framework of their business activities. For instance, they might set up an in-house kindergarten or organise health campaigns for their employees, squeeze energy consumption with eco-efficiency analyses and energy-saving systems or promote art, culture and sport.

Nowadays, managers in big companies are dedicated to establish a strong corporate social responsibility strategies, since well-known that companies have experiences a range of bottom-line benefits from it, such as: increased sales and market share, strengthened brand positioning, enhanced corporate image, increased ability to motivate and attract employees, and decreased operating costs. Moreover, many companies all over the world are becoming under the pressures to be more socially responsible, and corporations are becoming more active in global communities through direct involvement is social initiatives. Defined as "a commitment to improving community, well-being through discretionary business practices and contributions of corporate resources" [1] Philip Kotler and Susan Lee pointed six major options, why companies are involved in social initiatives:

• Corporate cause promotions to increase awareness and concern for social causes;

• Cause-related marketing to make contributions to social causes based on product sales;

• Corporate social marketing to support behavior-changing campaigns;

• Corporate philanthropy to make direct contributions to social causes

• Community responsible business practices, which involve discretionary business practices and investments to support social causes. [2] 

Corporate social initiatives often create a win-win situation for both the social marketing program and the company. And it might help the company to achieve the sustainability. For example, when a company which produce contraceptives donate condoms to a funded project (NGO) at a price lower than other commercial brands, this partnership may make a benefit for the company, because the brand may become well-known not only among target audience, but among other citizens of the city as well, and loyalty created through the social marketing program could continue to improve the image of the commercial companies brand even after donor support is over. [3] 

Nowadays, many companies shifted the corporate social initiatives "from obligation to strategy" [4] , because many managers believe that social initiative is a good way to advertise the product and to be above of their competitors. Furthermore, during the process of organizing and implementing such social initiatives, commercial companies have an opportunity to establish partnership with government agencies and representatives of NGOs, thus, can serve to a successful business. [5] 


Corporate social responsibility is self-regulation by a company with the objective of embracing responsibility for the company's actions and creating a positive impact through its activities on its customers, employees, communities and the environment. A company may build into its mission, strategy and everyday operations elements that serve to promote specific goals, for example, using recycled paper or organic hand soap in the offices to help save the environment.

Facets of CSR

Dr. Archie and B. Caroll in 1991 have identified four areas that compose the corporate social responsibility, and they described it as pyramid: legal is on the top, economic, ethical, and philanthropic is at the end. This pyramid is widely used, in order to explain to the stakeholders the main business sphere of the company.


Corporations must ensure that their business practices are legal. Obeying regulations helps protect consumers, who rely on a business to be truthful about the products it sells, and investors, who stand to lose profits if a company is penalized or shut down because of illegal practices.

A company's legal responsibilities are the requirements that are placed on it by the law. Next to ensuring that company is profitable, ensuring that it obeys all laws is the most important responsibility, according to the theory of corporate social responsibility. Legal responsibilities can range from securities regulations to labor law, environmental law and even criminal law.


According to the 2011 book "Business Ethics," a company's economic responsibilities include being profitable in order to provide a return on investment to owners and shareholders, to create jobs in their communities and to contribute useful products and services to society. Part of being economically responsible means streamlining processes to find the most efficient ways to run your business and innovating your product offerings and marketing to increase revenue.

A company's first responsibility is its economic responsibility -- that is to say, a company needs to be primarily concerned with turning a profit. This is for the simple fact that if a company does not make money, it won't last, employees will lose jobs and the company won't even be able to think about taking care of its social responsibilities. Before a company thinks about being a good corporate citizen, it first needs to make sure that it can be profitable.


Beyond abiding by the letter of the law, an organization's ethical responsibilities include managing waste, recycling and consumption. These areas are sometimes regulated by city, state or federal governments, but often a company can go further than what the law requests and institute policies that help sustain the environment for future generations. Other ethical responsibilities come in the form of advertising, as in not stretching the truth to a customer just to get them to make a purchase, and treatment of employees. A company can provide more than minimum wage and minimum safety precautions for employees; it can provide excellent benefits, insurance and invest resources in building a clean and safe workplace where employees will be happy to come each day.

Economic and legal responsibilities are the two big obligations of a company. After a company has met these basic requirements, a company can concern itself with ethical responsibilities. Ethical responsibilities are responsibilities that a company puts on itself because its owners believe it's the right thing to do -- not because they have an obligation to do so. Ethical responsibilities could include being environmentally friendly, paying fair wages or refusing to do business with oppressive countries, for example.


The authors of the 2011 "Business Ethics" also suggest that part of the philanthropic responsibility corporations face is to promote the welfare of humans and to spread goodwill. An example of this is The Xerox Foundation's "Xerox Employee Matching Gifts Program" in which Xerox matches its employees' contributions to higher education institutions up to $1,000. Similarly, the PepsiCo Foundation has committed over $2 million to World Food Program USA, which helps fight hunger in "vulnerable communities around the globe."

If a company is able to meet all of its other responsibilities, it can begin meeting philanthropic responsibilities. Philanthropic responsibilities are responsibilities that go above and beyond what is simply required or what the company believes is right. They involve making an effort to benefit society -- for example, by donating services to community organizations, engaging in projects to aid the environment or donating money to charitable causes

Benefits for the Company

Although direct effects haven't been proved and much criticism has risen around CSR, companies identify some obvious benefits. Implementing the values and goals of CSR improve the judgment and reputation of the business among customers. In a strong, competitive market it also makes the business stand out from its rivals. CSR may also prompt current and potential employees to commit themselves to the company and promote its values in their private lives.

A Good Example

The Body Shop is the most cited example of establishing CSR early in an exceptional way. The natural-cosmetics company promotes social and environmental issues. It implemented a shared campaign with Greenpeace to save the whales; a campaign against overly skinny models to avoid perpetuating bulimia and anorexia; and an initiative called Community Fair Trade to help people sell their products in developing countries. It also regularly sponsors local charity and community events.

Dedicating company efforts toward curing and preventing debilitating diseases are on the top of the social responsibility list for some companies. Fashion designer Kenneth Cole has for many years promoted AIDS research and awareness through his clothing production company. A portion of the Starbucks Foundation goes toward providing children with clean water. Through customer consumption of Ethos Water, the coffee company helps to fund sustainable water programs internationally.

A Cautionary Example

H&M, the clothing store implemented the CSR strategy of producing clothing items from organic cotton. The organic-clothing line gave consumers a positive image towards H&M for years. But this image was easily destroyed when three different reports in one year accused the company of using genetically modified cotton from India in its products. Today, H&M's new line represents only low prices but not organic clothing.