Corporate social responsibility (CSR, also called corporate conscience, corporate

citizenship or sustainable responsible business/ Responsible Business)[1] is a form of

corporate self-regulation integrated into a business model. CSR policy functions as a selfregulatory mechanism whereby a business monitors and ensures its active compliance with
the spirit of the law, ethical standards and international norms. In some models, a firm's
implementation of CSR goes beyond compliance and engages in "actions that appear to
further some social good, beyond the interests of the firm and that which is required by
law."[2][3] CSR aims to embrace responsibility for corporate actions and to encourage a
positive impact on the environment and stakeholders including consumers, employees,
investors, communities, and others.
The term "corporate social responsibility" became popular in the 1960s and has remained a
term used indiscriminately by many to cover legal and moral responsibility more narrowly
construed.[4]
Proponents argue that corporations increase long term profits by operating with a CSR
perspective, while critics argue that CSR distracts from business' economic role. A 2000
study compared existing econometric studies of the relationship between social and financial
performance, concluding that the contradictory results of previous studies reporting positive,
negative, and neutral financial impact, were due to flawed empirical analysis and claimed
when the study is properly specified, CSR has a neutral impact on financial outcomes.[5]
Critics[6][7] questioned the "lofty" and sometimes "unrealistic expectations" in CSR.[8] or that
CSR is merely window-dressing, or an attempt to pre-empt the role of governments as a
watchdog over powerful multinational corporations.
Political sociologists became interested in CSR in the context of theories of globalization,
neoliberalism and late capitalism. Some sociologists viewed CSR as a form of capitalist
legitimacy and in particular point out that what began as a social movement against
uninhibited corporate power was transformed by corporations into a 'business model' and a
'risk management' device, often with questionable results [9]
CSR is titled to aid an organization's mission as well as a guide to what the company stands
for to its consumers. Business ethics is the part of applied ethics that examines ethical
principles and moral or ethical problems that can arise in a business environment. ISO 26000
is the recognized international standard for CSR. Public sector organizations (the United
Nations for example) adhere to the triple bottom line (TBL). It is widely accepted that CSR
adheres to similar principles, but with no formal act of legislation.
The notion is now extended beyond purely commercial corporations, e.g. to universities.[10]

Definition
Business dictionary defines CSR as "A companys sense of responsibility towards the
community and environment (both ecological and social) in which it operates. Companies
express this citizenship (1) through their waste and pollution reduction processes, (2) by
contributing educational and social programs and (3) by earning adequate returns on the
employed resources."[11]

A broader definition expands from a focus on stakeholders to include philanthropy and

volunteering.[12]

Consumer perspectives
Most consumers agree that while achieving business targets, companies should do CSR at the
same time.[13] However not all CSR activities are popular. Most consumers believe
companies doing charity will receive a positive response.[14] Somerville also found that
consumers are loyal and willing to spend more on retailers that support charity. Consumers
also believe that retailers selling local products will gain loyalty.[15] Smith (2013)[16] shares
the belief that marketing local products will gain consumer trust. However, environmental
efforts are receiving negative views given the belief that this would affect customer
service.[15] Oppewal et al. (2006) found that not all CSR activities are attractive to
consumers.[17] They recommended that retailers focus on one activity.[18] Becker-Olsen
(2006)[19] found that if the social initiative done by the company is not aligned with other
company goals it will have a negative impact. Mohr et al.(2001)[20] and Groza et al. (2011)
[21]
also emphasise the importance of reaching the consumer.

Approaches

CSR Approaches
Some commentators have identified a difference between the Canadian (Montreal school of
CSR), the Continental European and the Anglo-Saxon approaches to CSR.[22] It is said that
for Chinese consumers, a socially responsible company makes safe, high-quality products;
for Germans it provides secure employment; in South Africa it makes a positive contribution
to social needs such as health care and education.[23] And even within Europe the discussion
about CSR is very heterogeneous.[24]
A more common approach to CSR is corporate philanthropy. This includes monetary
donations and aid given to nonprofit organizations and communities. Donations are made in

areas such as the arts, education, housing, health, social welfare and the environment, among
others, but excluding political contributions and commercial event sponsorship.[25]
Another approach to CSR is to incorporate the CSR strategy directly into operations. For
instance, procurement of Fair Trade tea and coffee.
Creating Shared Value, or CSV is based on the idea that corporate success and social welfare
are interdependent. A business needs a healthy, educated workforce, sustainable resources
and adept government to compete effectively. For society to thrive, profitable and
competitive businesses must be developed and supported to create income, wealth, tax
revenues and philanthropy. The Harvard Business Review article Strategy & Society: The
Link between Competitive Advantage and Corporate Social Responsibility provided examples
of companies that have developed deep linkages between their business strategies and
CSR.[26] CSV acknowledges trade-offs between short-term profitability and social or
environmental goals, but emphasizes the opportunities for competitive advantage from
building a social value proposition into corporate strategy. CSV gives the impression that
only two stakeholders are important - shareholders and consumers.
Many companies employ benchmarking to assess their CSR policy, implementation and
effectiveness. Benchmarking involves reviewing competitor initiatives, as well as measuring
and evaluating the impact that those policies have on society and the environment, and how
others perceive competitor CSR strategy.[27]

Cost-benefit analysis
In competitive markets a cost-benefit analysis of CSR initiatives, can be examined using a
resource-based view (RBV). According to Barney (1990) "formulation of the RBV,
sustainable competitive advantage requires that resources be valuable (V), rare (R),
inimitable (I) and non-substitutable (S)."[28][29] A firm introducing a CSR-based strategy
might only sustain high returns on their investment if their CSR-based strategy could not be
copied (I). However, should competitors imitate such a strategy, that might increase overall
social benefits. Firms that choose CSR for strategic financial gain are also acting
responsibly.[3]
RBV presumes that firms are bundles of heterogeneous resources and capabilities that are
imperfectly mobile across firms. This imperfect mobility can produce competitive advantages
for firms that acquire immobile resources. McWilliams and Siegel (2001) examined CSR
activities and attributes as a differentiation strategy. They concluded that managers can
determine the appropriate level of investment in CSR by conducting cost benefit analysis in
the same way that they analyze other investments.
Reinhardt (1998) found that a firm engaging in a CSR-based strategy could only sustain an
abnormal return if it could prevent competitors from imitating its strategy.[30]

Scope
Initially, CSR emphasized the official behavior of individual firms. Later, it expanded to
include supplier behavior and the uses to which products were put and how they were
disposed of after they lost value.

Supply chain
Incidents like the 2013 Savar building collapse pushed companies to consider how the
behavior of their suppliers impacted their overall impact on society. Irresponsible behavior
reflected on both the misbehaving firm, but also on its corporate customers. Supply chain
management expanded to consider the CSR context. Wieland and Handfield (2013) suggested
that companies need to include social responsibility in their reviews of component quality.
They highlighted the use of technology in improving visibility across the supply chain.[31]

Implementation
CSR may be based within the human resources, business development or public relations
departments of an organisation,[12] or may be a separate unit reporting to the CEO or the
board of directors. Some companies approach CSR without a clearly defined team or
programme.

Engagement plan
An engagement plan can assist in reaching a desired audience. A corporate social
responsibility individual or team plans the goals and objectives of the organization. As with
any corporate activity, a defined budget demonstrates commitment and scales the program's
relative importance.

Accounting, auditing and reporting

Main article: Social accounting
Social accounting is the communication of social and environmental effects of a company's
economic actions to particular interest groups within society and to society at large.[32]
Social accounting emphasizes the notion of corporate accountability. Crowther defines social
accounting as "an approach to reporting a firms activities which stresses the need for the
identification of socially relevant behavior, the determination of those to whom the company
is accountable for its social performance and the development of appropriate measures and
reporting techniques."[33] Reporting guidelines and standards serve as frameworks for social
accounting, auditing and reporting:

AccountAbility's AA1000 standard, based on John Elkington's triple bottom line

(3BL) reporting
The Prince's Accounting for Sustainability Project's Connected Reporting
Framework[34]
The Fair Labor Association conducts audits based on its Workplace Code of Conduct
and posts audit results on the FLA website.
The Fair Wear Foundation verifies labour conditions in companies' supply chains,
using interdisciplinary auditing teams.
Global Reporting Initiative's Sustainability Reporting Guidelines
Economy for the Common Good's Common Good Balance Sheet[35]
GoodCorporation's standard[36] developed in association with the Institute of Business
Ethics

Synergy Codethic 26000[37] Social Responsibility and Sustainability Commitment

Management System (SRSCMS) Requirements Ethical Business Best Practices of
Organizations - the necessary management system elements to obtain a certifiable
ethical commitment management system. The standard scheme has been build around
ISO 26000 and UNCTAD Guidance on Good Practices in Corporate Governance.The
standard is applicable by any type of organization.;
Earthcheck Certification / Standard
Social Accountability International's SA8000 standard
Standard Ethics Aei guidelines
The ISO 14000 environmental management standard
The United Nations Global Compact requires companies to communicate on their
progress[38] (or to produce a Communication on Progress, COP), and to describe the
company's implementation of the Compact's ten universal principles.[39]
The United Nations Intergovernmental Working Group of Experts on International
Standards of Accounting and Reporting (ISAR) provides voluntary technical guidance
on eco-efficiency indicators,[40] corporate responsibility reporting,[41] and corporate
governance disclosure.[42]
The FTSE Group publishes the FTSE4Good Index, an evaluation of CSR
performance of companies.

In nations such as France, legal requirements for social accounting, auditing and reporting
exist, though international or national agreement on meaningful measurements of social and
environmental performance has not been achieved. Many companies produce externally
audited annual reports that cover Sustainable Development and CSR issues ("Triple Bottom
Line Reports"), but the reports vary widely in format, style, and evaluation methodology
(even within the same industry). Critics dismiss these reports as lip service, citing examples
such as Enron's yearly "Corporate Responsibility Annual Report" and tobacco companies'
social reports.
In South Africa, as of June 2010, all companies listed on the Johannesburg Stock Exchange
(JSE) were required to produce an integrated report in place of an annual financial report and
sustainability report.[43] An integrated report reviews environmental, social and economic
performance alongside financial performance. This requirement was implemented in the
absence of formal or legal standards. An Integrated Reporting Committee (IRC) was
established to issue guidelines for good practice.

Ethics training
The rise of ethics training inside corporations, some of it required by government regulation,
has helped CSR to spread. The aim of such training is to help employees make ethical
decisions when the answers are unclear.[44] The most direct benefit is reducing the likelihood
of "dirty hands",[45] fines and damaged reputations for breaching laws or moral norms.
Organizations see increased employee loyalty and pride in the organization.[46]

Common actions
Common CSR actions include:[47]

Environmental sustainability: recycling, waste management, water management,

renewable energy, reusable materials, 'greener' supply chains, reducing paper use and

adopting Leadership in Energy and Environmental Design (LEED) buildind

standards.[48][49][50]

Community involvement: This can include raising money for local charities,
providing volunteers, sponsoring local events, employing local workers, supporting
local economic growth, engaging in fair trade practices, etc.[51][52]

Ethical marketing: Companies that ethically market to consumers are placing a higher
value on their customers and respecting them as people who are ends in themselves.
They do not try to manipulate or falsely advertise to potential consumers. This is
important for companies that want to be viewed as ethical.

Social license
Social license refers to a local communitys acceptance or approval of a company. Social
license exists outside formal regulatory processes. Social license can nevertheless be acquired
through timely and effective communication, meaningful dialogue and ethical and
responsible behavior.
Displaying commitment to CSR is one way to achieve social license, by enhancing a
companys reputation.[53]

Potential business benefits

A large body of literature exhorts business to adopt measures non-financial measures of
success (e.g., Deming's Fourteen Points, balanced scorecards). While CSR benefits are hard
to quantify, Orlitzky, Schmidt and Rynes[54] found a correlation between
social/environmental performance and financial performance.
The business case for CSR[55] within a company employs one or more of these arguments:

Triple bottom line

"People, planet and profit", also known as the triple bottom line form one way to evaluate
CSR. "People" refers to fair labour practices, the community and region where the business
operates. "Planet" refers to sustainable environmental practices. Profit is the economic value
created by the organization after deducting the cost of all inputs, including the cost of the
capital (unlike accounting definitions of profit).[56][57]
This measure was claimed to help some companies be more conscious of their social and
moral responsibilities.[58] However, critics claim that it is selective and substitutes a
company's perspective for that of the community. Another criticism is about the absence of a
standard auditing procedure.[59]

Human resources
A CSR program can be an aid to recruitment and retention,[60][61] particularly within the
competitive graduate student market. Potential recruits often consider a firm's CSR policy.
CSR can also help improve the perception of a company among its staff, particularly when

staff can become involved through payroll giving, fundraising activities or community
volunteering. CSR has been credited with encouraging customer orientation among customerfacing employees.[62]

Risk management
Managing risk is an important executive responsibility. Reputations that take decades to build
up can be ruined in hours through corruption scandals or environmental accidents.[63] These
draw unwanted attention from regulators, courts, governments and media. CSR can limit
these risks.[64]

Brand differentiation
CSR can help build customer loyalty based on distinctive ethical values.[65] Some companies
use their commitment to CSR as their primary positioning tool, e.g., The Co-operative Group,
The Body Shop and American Apparel[66]
Some companies use CSR methodologies as a strategic tactic to gain public support for their
presence in global markets, helping them sustain a competitive advantage by using their
social contributions as another form of advertising.[67]

Reduced scrutiny
Corporations are keen to avoid interference in their business through taxation and/or
regulations. A CSR program can persuade governments and the public that a company takes
health and safety, diversity and the environment seriously, reducing the likelihood that
company practices will be closely monitored.

Supplier relations
Appropriate CSR programs can increase the attractiveness of supplier firms to potential
customer corporations. E.g., a fashion merchandiser may find value in an overseas
manufacturer that uses CSR to establish a positive imageand to reduce the risks of bad
publicity from uncovered misbehavior.

Criticisms and concerns

CSR concerns include its relationship to the purpose of business and the motives for engaging
in it.

Nature of business
Milton Friedman and others argued that a corporation's purpose is to maximize returns to its
shareholders and that obeying the laws of the jurisdictions within which it operates
constitutes socially responsible behavior.[68]
While some CSR supporters claim that companies practicing CSR, especially in developing
countries, are less likely to exploit workers and communities, critics claim that CSR itself
imposes outside values on local communities with unpredictable outcomes.[69]

Better governmental regulation and enforcement, rather than voluntary measures, are an
alternative to CSR that moves decision-making and resource allocation from public to private
bodies.[70] However, critics claim that effective CSR must be voluntary as mandatory social
responsibility programs regulated by the government interferes with peoples own plans and
preferences, distorts the allocation of resources, and increases the likelihood of irresponsible
decisions.[71]

Motives

Play media
A story of CSR promoted by Azim Premji Foundation in India[72]

video

Some critics believe that CSR programs are undertaken by companies to distract the public
from ethical questions posed by their core operations. They argue that the reputational
benefits that CSR companies receive (cited above as a benefit to the corporation) demonstrate
the hypocrisy of the approach.[73]

Misdirection
Another concern is that sometimes companies use CSR to direct public attention away from
other, harmful business practices. For example, McDonald's Corporation positioned its
association with Ronald McDonald House as CSR[74] while its meals have been accused of
promoting poor eating habits.[75]

Controversial industries
Industries such as tobacco, alcohol or munitions firms make products that damage their
consumers and/or the environment. Such firms may engage in the same philanthropic
activities as those in other industries. This duality complicates assessments of such firms with
respect to CSR.[76]

Stakeholder influence
One motivation for corporations to adopt CSR is to satisfy stakeholders.
Branco and Rodrigues (2007) describe the stakeholder perspective of CSR as the set of views
of corporate responsibility held by all groups or constituents with a relationship to the
firm.[77] In their normative model the company accepts these views as long as they do not
hinder the organization. The stakeholder perspective fails to acknowledge the complexity of
network interactions that can occur in cross-sector partnerships. It relegates communication
to a maintenance function, similar to the exchange perspective.[78]

Ethical consumerism

The rise in popularity of ethical consumerism over the last two decades can be linked to the
rise of CSR.[79] Consumers are becoming more aware of the environmental and social
implications of their day-to-day consumption decisions and in some cases make purchasing
decisions related to their environmental and ethical concerns.[80]

Socially responsible investing

Main article: Socially responsible investing
Shareholders and investors, through socially responsible investing are using their capital to
encourage behavior they consider responsible. However, definitions of what constitutes
ethical behavior vary. For example, some religious investors in the US have withdrawn
investment from companies that violate their religious views, while secular investors divest
from companies that they see as imposing religious views on workers or customers.[81]

Creating shared value

Non-governmental organizations are also taking an increasing role, leveraging the media and
the Internet to increase the visibility of corporate behavior. Through education and dialogue,
the development of community awareness in pushing businesses to change their behavior is
growing.[82]
Creating Shared Value (CSV) claims to be more community aware than CSR. Several
companies are refining their collaboration with stakeholders accordingly.

Public policies
Some national governments promote socially and environmentally responsible corporate
practices. The heightened role of government in CSR has facilitated the development of
numerous CSR programs and policies.[83] Various European governments have pushed
companies to develop sustainable corporate practices.[84] CSR critics such as Robert Reich
argued that governments should set the agenda for social responsibility with laws and
regulation that describe how to conduct business responsibly.
Regulation
Fifteen European Union countries actively engaged in CSR regulation and public policy
development.[84] CSR efforts and policies are different among countries, responding to the
complexity and diversity of governmental, corporate and societal roles. Studies claimed that
the role and effectiveness of these actors were case-specific.[83]
The variety among companies complicates regulatory processes.[85] Self-regulation allows
each corporate actor to balance profits and social responsibility without cumbersome
governmental involvement. Studies suggest that mandated CSR distorts the allocation of
resources and increases the likelihood of irresponsible decisions.[86]
Bulkeley cited the Australian government's actions to avoid compliance with the Kyoto
Protocol in 1997, over concerns of economic loss and national interest. The Australian
government claimed that the pact would damage Australia more than any other OECD
nation.[87] In November 2007, the new Prime Minister Kevin Rudd ratified the protocol.

Canada adopted CSR in 2007. Prime Minister Harper encouraged Canadian mining
companies to meet Canadas newly developed CSR standards.[88]
Laws
In the 1800s,the US government could take away a firm's license if it acted irresponsibly.
Corporations were viewed as "creatures of the state" under the law. In 1819, the United States
Supreme Court in Dartmouth College vs. Woodward established a corporation as a legal
person in specific contexts. This ruling allowed corporations to be protected under the
Constitution and prevented states from regulating firms.[89] Recently countries included CSR
policies in governtment agendas.[84]
On 16 December 2008, the Danish parliament adopted a bill making it mandatory for the
1100 largest Danish companies, investors and state-owned companies to include CSR
information in their financial reports. The reporting requirements became effective on 1
January 2009.[90] The required information included:

CSR/SRI policies
How such policies are implemented in practice
Results and management expectations

CSR/SRI is voluntary in Denmark, but if a company has no policy on this it must state its
positioning on CSR in financial reports.[91]
In 2014, India became the world's first country to enact a mandatory minimum CSR spending
law. Under Companies Act, 2013, any company having a net worth of 500 crore or more or a
turnover of 1,000 crore or a net profit of 5 crore must spend 2% of their net profits on CSR
activities.[92] The rules came into effect from 1 April 2014.[93]

Crises and their consequences

Crises have encouraged the adoption of CSR. The CERES principles were adopted following
the 1989 Exxon Valdez incident.[45] Other examples include the lead paint used by toy maker
Mattel, which required the recall of millions of toys and caused the company to initiate new
risk management and quality control processes. Magellan Metals was found responsible for
lead contamination killing thousands of birds in Australia. The company ceased business
immediately and had to work with independent regulatory bodies to execute a cleanup.
Odwalla experienced a crisis with sales dropping 90% and its stock price dropping 34% due
to cases of E. coli. The company recalled all apple or carrot juice products and introduced a
new process called "flash pasteurization" as well as maintaining lines of communication
constantly open with customers.

Geography
Corporations that employ CSR behaviors do not always behave consistently in all parts of the
world.[94] Conversely, a single behavior may not be considered ethical in all jurisdictions.
E.g., some jurisdictions forbid women from driving,[95] while others require women to be
treated equally in employment decisions.

UK retail sector
A 2006 study[96] found that the UK retail sector showed the greatest rate of CSR involvement.
Many of the big retail companies in the UK joined the Ethical Trading Initiative,[97] an
association established to improving working conditions and worker health.
Tesco (2013)[98] reported that their essentials are Trading responsibility, Reducing our
Impact on the Environment, Being a Great Employer and Supporting Local
Communities. J Sainsbury[99] employs the headings Best for food and health, Sourcing
with integrity, Respect for our environment, Making a difference to our community, and
A great place to work, etc. The four main issues to which UK retail these companies
committed are environment, social welfare, ethical trading and becoming an attractive
workplace.[100][101]
Top ten UK retail brands in 2013 based on Retail Week reports:[102]
Retailer
Annual Sales bn
Tesco
42.8
Sainsbury's
22.29
Asda
21.66
Morrisons
17.66
Mark and Spencer
8.87
Co-operative Group
8.18
John Lewis Partnership
7.76
Boots
6.71
Home Retail Group
5.49
King Fisher
4.34
Anselmsson and Johansson (2007)[103] assessed three areas of CSR performance: human
responsibility, product responsibility and environmental responsibility. Martinuzzi et al.
described the terms, writing that human responsibility is the company deals with suppliers
who adhere to principles of natural and good breeding and farming of animals, and also
maintains fair and positive working conditions and work-place environments for their own
employees. Product responsibility means that all products come with a full and complete list
of content, that country of origin is stated, that the company will uphold its declarations of
intent and assume liability for its products. Environmental responsibility means that a
company is perceived to produce environmental-friendly, ecological, and non-harmful
products.[104] Jones et al. (2005) found that environmental issues are the most commonly
reported CSR programs among top retailers.[105]
Business leaders today are discovering the power of Corporate Social Responsibility (CSR).
No longer is giving back to your community just a good idea or simply a nice thing to do.
More and more business people are finding out that a clearly articulated CSR strategy
results in a strong bottom line and a more sustainable company. As a result, companies
everywhere are scrambling to find out more about this practice of Corporate Social
Responsibility and how it can benefit them. What secret lies hidden beneath this idea of doing
well while doing good? How can you measure the results of CSR? What does a good CSR
program look like and how can you create one for your company? Answers to these questions

will help you better understand the rationale for CSR and how you can use this powerful
business strategy to achieve your companys goals.

Secrets of Corporate Social Responsibility

Would your company like to improve financial performance, reduce operating costs, enhance
brand image and reputation, increase sales and customer loyalty, increase productivity and
quality, increase ability to attract and retain employees, and reduce regulatory oversight?
Today businesses are engaging in CSR because it accomplishes all these goals and more. In a
nutshell, heres how it works: customers have proven that they prefer to do business with
companies that care enough about the community to give back. If your company embraces a
strong CSR policy and your marketing department tells people about it, your customer loyalty
will increase resulting in increased sales.
Another result of being known in the community as a business that gives back is you will
attract top employees. And you will retain them. Just as customers prefer to do business with
companies that give back, so employees prefer to work for companies where they can be part
of improving their community. Most businesses know that strong employee retention results
in reduced operating costs. But did you know that motivated employees are more
productive? Studies show there is a direct positive link between job satisfaction and firm
value.
CSR involves firms considering the interests of all stakeholders, not just shareholders. Angel
Martinez, President and CEO of Deckers Outdoor Corporation, recently explained to a group
of Santa Barbara business people that he prioritizes concerns of customers and employees
above those of shareholders. His rationale is that if customers and employees are happy, sales
will be up, costs will be down, and shareholders will be rewarded with improved stock
returns.
Stakeholders can also include the environment and the social capital within the community at
large. Studies also show that strong CSR practices will reduce the likelihood of negative
regulatory action. Once shareholders better understand the implications of CSR, they can
embrace this practice as an important business strategy and a mutual benefit.

How to measure the results of Corporate Social

Responsibility
You might be thinking that this all makes sense in theory but wondering about how the
results of CSR can be measured. Even if you would prefer that your company be a good
corporate citizen by giving back, you have to be able to justify additional costs with improved
bottom line projections. Its true that CSR is an intangible asset. As such, it is not physical in
nature, and cannot be seen or physically measured. Other examples of intangible assets
include intellectual property, brand, customer loyalty, and human capital.
Unfortunately, the stock market uses traditional valuation methodologies devised for the 20thcentury firm and based on physical assets, which cannot accommodate intangibles easily. As
a result, the market takes a very long time to incorporate intangibles into the stock price.
However, you have only to look at the incredible success of Fortunes Best Companies to

Work For list to discover the high value placed on job satisfaction and the resulting decrease
in cost and increase in profit. Results from this list are a potential solution to the lack of
information that surrounds CSR and other intangibles. So be careful that you dont use
outdated measurement sources when evaluating the benefits of adopting CSR.

How to create your own Corporate Social Responsibility

program
Many companies adopting CSR policies have adapted the triple bottom line approach to
their annual reports. The new measure includes updates on social, environmental, and
financial performance. The first step to creating your own CSR program is to increase
awareness among your companys stakeholders. Including a triple bottom line approach in
your annual report is a good way to accomplish this. The CEO and top leadership must lead
by example and inspire everyone with the new vision.
The second step to CSR is to spend time integrating your companys core values into the
way you do business. Globalization and the information age have reshaped old expectations
limited to simply generating profit. Today, companies realize that doing what is in the best
long term interest of the customer is ultimately doing what is best for the company. So doing
good for the customer is just good business. Identifying and incorporating your
companys core values requires a team approach. Invite representatives from all areas of the
business to serve on the team.
Step three is for the team to create a corporate giving statement. The statement can include
the companys purpose for giving, which types of causes to give to, what you will be giving
(money, volunteer time, in-kind resources), when and how often you will give, and how the
company will give (using employee giving programs, corporate matches, volunteer time).
Your corporate giving statement will help your company respond to requests, increase
awareness of your philanthropy with employees and the community, prevent well-intentioned
but misguided giving, and sustain your companys commitment even in times of corporate
change.
Begin today to put your companys CSR program together and discover the secrets that lie
behind this invaluable practice. For additional guidance, check out the corporate social
responsibility newswire www.CSRwire.com the self-proclaimed leading source of corporate
responsibility and sustainability, press releases, reports, and news. The site is a goldmine of
information issued by leading U.S. businesses on all aspects of CSR, as well as general
overviews that help frame the CSR phenomenon.
- See more at: http://www.nonprofitkinect.org/article/2909-corporate-social-responsibilityeasy-steps-to-give-your-company-csr#sthash.xLRjSS1y.dpuf

7 Ways to Promote Corporate Social Responsibility

Corporate Social Responsibility or CSR is a business strategy with a growing currency in
the US and around the world. CSR argues that organizations have a responsibility to multiple
stakeholders in the conduct of their business, and not just to the shareholders. It is about

businesses assuming responsibilities that go well beyond the scope of simple commercial
relationships.
The World Business Council for Sustainable Development defines CSR as the continuing
commitment by business to behave ethically and contribute to economic development while
improving the quality of life of the workforce and their families as well as of the local
community and society at large.
A growing number of research projects and surveys reveal strong linkages between an
organizations CSR activities and improvements in a companys traditional
performance drivers, such as competitiveness, market positioning, investor relations,
recruiting and risk management. There are now scores of investment funds available to
people who wish to invest in companies or producers that are socially and environmentally
responsible.
Although this definition may be at odds with certain financial expectations of maximizing
shareholder value, American companies are becoming much more aware of their
responsibilities to the communities and markets in which they operate. And they are
vigorously, but not universally, embracing these objectives.
Indeed, corporate annual reports are indicating significant citizenship activities that add value
to their stakeholders. PepsiCo, for example, clearly articulates its responsibilities regarding
the environment and community affairs. It has established measurement indexes for human,
environmental, and talent sustainability that impacts executive decision making. Kelloggs
donates over 20 million dollars of their products each year to fight world hunger. In 2005,
Ben & Jerrys opened a store in Austin, Texas for a community organization that helps at-risk
youth and families. The store provides job opportunities for the communitys clients and all
profits from the store go directly to the organization. Ben & Jerrys does not collect a
franchise fee.
Regionally, Maine, New Hampshire and Vermont have established state-wide organizations
that provide resources, share best practices, and discuss public policy issues related to CSR
practices. The Maine Businesses for Social Responsibility (www.mebsr.org) is an
organization made up of diverse businesses who believe, in theory and in practice, that
companies can be a powerful force for positive change in their communities in which they
conduct their operations. Their mission statement is quite clear: Successful management of
the dual bottom line of profitability and social responsibility will be the goal of every
business in the state.
CSR can be defined by many variables. Yet more and more stakeholders are requesting and
demanding that companies in their communities and portfolios focus as much attention to
their CSR as they do to their financials.
Human Resources shares the lead in advancing and articulating the companys
approach to CSR. In the quest for top notch employees, recruiters at colleges are routinely
being asked about their companys commitment to and examples of CSR. Generation Xers
and Generation Yers are aggressive in their desire to work for companies that are socially
responsive in addition to their financial and business acumen.

Corporate Social Responsibility will not solve all of societys ills, but it will go along way to
making the world a better place. In corporate terms, CSR makes good business sense. It gives
everyone a reason to smile. It is what the future of business is all about.
Here are some suggestions for Human Resources leaders on how to promote corporate
social responsibility within their organizations:
1. Define corporate social responsibility for your company or industry.
What works for a bank or furniture manufacturer may be significantly different from a
bottling company or a grocery store chain.
2. Conduct extensive and continual research on the concepts of Corporate Social
Responsibility.
The World Business Council for Sustainable Development, mentioned above, and the Global
Reporting Initiative (www.globalreporting.org) are two excellent research sources.
3. Establish metrics for measuring the impact of the companys CSR practices.
For example, what percentage of after tax dollars is used to support these activities? How
does it compare to other comparable companies? How many labor hours per month or per
year are set aside for CSR activities? Quantitative metrics are easier to defend and promote
than qualitative metrics.
4. Involve employees in defining and advancing CSR.
Form ad-hoc groups to decide how best to be appropriately socially responsible with the
resources available. Give them the authority and responsibility to figure out a way to make it
happen. They will do it far faster than some corporate committee.
5. Keep track of all measurable costs.
As much as the company wants to be socially responsible, it also has an obligation to be
fiscally accountable to other shareholders;
6. Communicate to everyone sometimes subtly, sometimes loudly.
Publicize your activities internally to all employees and externally to all other stakeholders as
appropriate. Invite civic, religious, and corporate leaders in to show what you are doing and
encourage them to join you in their efforts.
7. Establish positive and pro-active relationships with other socially responsible companies.
There is power in numbers and they are always a great source of ideas that might work for
your organization.