Understanding Aspects Of Corporate Social Responsibility Commerce Essay


According to Michael (2003) there are main 7 azimuths in CSR such as owner/investors, management, employees, customers, environment, the wider community and suppliers. Each of them has its own crucial affects on any organisations depends on what kind of business they running and mission statements. However I will explain only some of them which I suppose more crucial than others

2.1 Employees

During of downsizing eras, employees have a hard time. Up till now, most companies are aware that good quality staffs crucial for business. Therefore, human resource policies that highlighted career development, flexible shifts and financial or non financial rewards for their employees. The prime example is Royal Bank of Scotland (RBS) they have wonderfully 'staff oriented' policy in order to attract talented workers. In additionally, in 2004 the RBS "Your time" program won the HR excellence award for "The Most Effective Use of Flexibility in the Workplace" (The Time magazine). As a result it sends indeed good news to the society. In term of CSR on employees, the Primark cloths stories have been heavily criticized. Due to paying low wage for employees in overseas or using child labour force, mass percent of people are refused to purchase their products. Although, using child labour force is illegal in the most of countries particularly in Western Europe and in the US, in some way those kids are helping for their family for better future. Personally, I believe that people cannot stop buying products from the Primark otherwise those children's future could be even worse. Therefore, in this particular CSR both of corporations and society must pay high attention.

2.2 Customers

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The main object of any business organisation due to sell their goods and services. The message must be open and honest about your product and services. Including what steps you take to be socially responsible. Recently, there was television advertisement of Pampers nappy, the message was 'if you purchase 2 packages of our nappies at the same time, the profit will be donating to provide vaccination for 1 child'. This sort of advertisements promotes your companies CSR as well products. Therefore, companies must be carefully connect with their customers

2.3 Natural environment

The strongest social movement to insist on responsibility from has been the environmental lobby. It has had the former dealing with issues such as smokestack pollution, nuclear wastage, the protection of ecosystem, plants and animal somehow it relates to the local people even. Consumer are getting pay more attention about environment which makes more and more hard issues for corporations. However, there are some corporations who have taken advantages of increasing their sales margin and profitability. In additionally, there is a sharp increase for environmentally friendly products and services such as Ford Motors launched the Focus which is Britain's most popular car incredibly fuel-efficient and demands reasonably low road taxes (Telegraph magazine 2008). Another example is reusing carrier bags in supermarkets due to environmentally unfriendly plastic bags. Chain supermarkets have started to encourage customers to re-use their plastic such as Tesco and Sainsbury's. As result, Tesco can reduce cost of producing bags.

2.4 Wider community

Business has always operated closely with government, however, recently business begun to think its wider role in society particularly in local, regional, national even international areas. In wider community organisations may do some projects in order to increase their relationship with society such as scholarships, community service projects, charity and supporting education. The chairman of Cadbury-Schweppes, Cadbury remarked that "Companies across the UK increasingly recognising the importance of business engagement with their community. Companies have wealth of expertise and skills. They also have powerful products and brands. Together through partnerships with wider community, they can create and deliver real benefits". There are noticeably numbers of organisations who do scholarships and charity such as UK's biggest donor Chris Hohn and George Soros all they say is 'I am returning what I have taken from society'

2.5 Suppliers

A study of Michael (2003) stated that producers might be able to apply the same regulation that they were required by their consumers. However, this is quite optimistic and obviously will not happen overnight. When it happens the result will be tough for suppliers even they will not able to catch up high standard and regulations. However, it is increasingly recognized that for suppliers in the same country as the parent enterprise, similar conditions should apply, so that, for instance, both have the same or similar codes of ethical practice. That why is brand new method the Supplier Chain Management. Once more choosing your suppliers could be hard task, if your organisation decided to be socially responsibility, your suppliers play important part of your approach to corporate social responsibility (CSR). For example, you might try to use local suppliers as much as possible. This helps you support your community and also reduces the energy wasted in deliveries. Another example is nowadays there are some numbers of campaigns to protect animal rights and animal welfare, therefore, we can see big promotion boards written on 'free range eggs' 'organic fruit and vegetables' in the mainstream supermarkets. That all mean retailers are shown how much they respect social demands and thoughts in order to attract more customers into their shops.

3. CSR in Volkswagen

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As I mentioned above, CSR must concerned same as company's culture and ethic and long term strategy thus CSR have to be relative to human resource management. In this case study CSR will be shown as main azimuth of CSR as employees. Needless to mention we know Volkswagen is Multinational Corporation playing big role in car manufacturing industries. Volkswagen could be best example of how companies should respond to CSR. During big recession in early 1990's the corporation agreed to do downsizing due to declining automobile demand and mayor problems with structure and efficiency. Downsizing may also have serious negative consequences for the employees who lose their jobs, for their families, and for the employees who survive the restructuring process. The point of downsizing cannot demonstrate the financial or structural benefits of downsizing, nor do they respond effectively to the social disadvantages of mass dismissals. Therefore, it is critical to consider alternate routes to the goals of cost reduction, productivity growth, and social welfare. At this time VW was talking to layoff as many as 30.000 employees (case study HRM, aug.2009). However, management had spoken to employees about current crisis as honest and open as possibly. Afterwards, both management and employees have found the way to pass economic recession in socially justifiable manner. The process of solving problem was using alternative ways rather than doing layoffs. Idea was simple at this time sales reduction was 20% thus total numbers of working hours was reduced by 20%. As a result Volkswagen did not do massive dismissal, in return employees were motivated, and society was delighted.

According to Frank (2007) the outcomes of social responsiveness is actual indicator of CSR. Therefore, Volkswagen was indicated very well due to their action against to massive dismissal by society.

4. CSR in Mongolia

Mongolia is one of developing countries in central Asia. Two of our main export cobber and gold to overseas, most of those companies are managed by foreign investors such as London based Ivanhoe mines and Rio Tinto; therefore, CSR is very crucial particularly in terms of environmental issue. As we studied BLE that mentioned multinational companies are main factors of encouraging corruption in the developing countries. Personally I believe that is true. Corruptions cause ignoring local and government laws and regulations. As results companies do not do what they supposed to get done which means foreign companies rarely ensuring the area mined is returned to close to its original state, therefore, lots of numbers of big and rivers have been disappeared abruptly. Mining companies cause lots of environmental issues such as erosion, loss of eco-system and contamination of soil. Even local people were forced to change the place where they have been living by generations to generations. To

5. Conclusion

Although, the corporation social responsibility is relatively new, nowadays the CSR is one of the crucial parts of any organisation. In additionally, organisation must give back something to their society, in order to expand either of their profit margin or relationship with a society. CSR should be implemented as part organisations culture planning not as an expense. I believe that any individual human being and organisation have to return what they have achieved from society for sake of better future.