Types of Corporate Social Responsibility (CSR)
Every business owner, as well as a manager of a large or small company, should keep in mind corporate social responsibility. It is important to maintain a socially responsible policy because of the three main reasons we have divided these into a pragmatic reason, an ethical reason, and a strategic reason. Pragmatic reason presumes that the company should care about stakeholders’ views as they form the reputation of this organization. The better the reputation of the firm is the bigger is its chances to excel. Ethical reason implies that businesses, as a part of the community, should adjust according to the ethical rules of the given community. Strategic reason claims that a company does not exist isolated from the society but is a part of the community. That is why for successful performance it must correspond with social needs and anticipate the expectations of stakeholders. CSR has four kinds of responsibility that must be considered simultaneously: economic, legal, ethical, and philanthropic. However, they are not evenly presented in different societies, and, as a result, not every business considers all four responsibilities as equally important. For instance, legal responsibility enforces companies to perform according to the laws of a certain state. However, the legislative regulations differ from country to country, which gives business owners an opportunity to find the most appropriate place for their firm. On the other hand, if they follow ethical responsibilities, they will not do anything that can arouse the accusation. Another example of the interrelation of social responsibilities is the gap between economic and philanthropic responsibilities. For example, a certain organization is economically responsible to its shareholders. It means that if the given shareholders are ethically and philanthropically responsible, the company is supposed to care about its reputation by maintaining similar responsibilities. What is more, another reason to set strong moral values as a policy of the company is to have a good reputation. As a rule it increases success of a company and, in this way, the CEO executes economic responsibility towards shareholders. On the other hand, economic responsibility assumes that first and foremost a certain organization is expected to be profitable. Therefore, its main concern should be to stand the competition and enrich the investors, owners, and employees.
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Business Ethics and Stakeholders
As it is seen from the example above, maintaining social responsibilities often leads to ambiguities and issues. Nevertheless, when it comes to the ethics of selling dangerous products, it makes it even harder to distinguish what is the right thing to do. Moreover, the question is, what is the true value, in terms of business adversarial approach, to set a high moral policy and maintain all types of social responsibility? Is this question relevant when it comes, for example, to drugs, guns, or women trafficking? To explore the possible issues more precisely one should consider the participants of business performance. They are called stakeholders. A stakeholder is any person who is connected with a given business and, thus, voluntary or not affects its progress. Therefore, according to this definition, there are four main groups of stakeholders: shareholders, employees, consumers, and communities.
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Ethics and Employees
Evaluating the possible ethical issues connected with employees the main problem seems to be neglect of human rights for life and safety. Every company should take the responsibility of providing healthy work conditions to its cooperators. The given duty is regulated by the Occupation Safety and Health Administration (OSHA). The given organization works to protect people from maltreatment at their working place. In addition, the OSHA encourages business owners to create relevant conditions for safe performance in spite of the working field. Finally, it provides information, training, and assistance to workers and employers. Workers may file a complaint to have OSHA inspect their workplace if they believe that their employer is not following OSHA standards or that there are serious hazards. The natural question is if the same standards are implemented towards the workers who sell guns? Who protects their rights? Do they have the rights to be protected by such an organization as OSHA? Is this omission is the ethical issue of guns dealer? Another question to consider is that the Universal Declaration of Human Rights claims Everyone has the right to life, liberty, and security of person. Do the employees automatically violate the given freedom by selling guns? Taking into consideration the types of social responsibilities and their peculiarities, one can state that the economical responsibility is satisfied as long as the given trafficking is profitable. The legal issue may be eliminated if the prohibited weapons or their parts are not sold. When it comes to the ethical issue, it is a well-known fact that a great number of citizens criticize weapon trafficking. Moreover, definitely, it is not the right thing to do because the guns do not protect, but rather make a bad situation worse. Therefore, the biggest issue in selling guns is the omission of philanthropic responsibility. It goes without saying that many business owners consider this type of social responsibility to be unimportant and partly it is true because their business can flourish without a philanthropic approach. However, today’s society is eager to maintain civilized relations both inside a native country and abroad. That is why it is essential to take moral values as seriously as all other components of social responsibility. Another important ethic issue is the reducing of working places. On the one hand, it is hard to imagine that irresponsible hiring and firing of drug dealers is a kind of ethical issue. On the other hand, if this kind of business is compared to the legal and the right one, then it should be surveyed according the same patterns. For that matter, a drug dealer is obligated to pay the bills as every other person. Therefore, if the drug seller is unexpectedly fired, he/she remains financially unprotected. The given situation may push this man to go to extremes, such as committing a crime or a suicide. Therefore, it is a manager’s responsibility to hire and fire the staff in a proper way.
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Ethics and Consumers
Another group of stakeholders are the consumers. The rights of customers for high-quality products or service are regulated by a federal Consumer Financial Protection Agency (CFPA). The Consumer Financial Protection Bureau claims that the purpose of the Consumer Financial Protection Agency is to protect and inform consumers of financial products, which by their nature can be too complex for non-professionals to understand. Meanwhile, the consumer’s right to fair and honest advertisement is enforced by the Federal Trade Commission. The given organization is aimed to prevent business practices that are anticompetitive or deceptive or unfair to consumers; enhance informed consumer choice and public understanding of the competitive process; and to accomplish this without unduly burdening legitimate business activity. The business owners are supposed to organize and maintain their businesses in a way that does not violate the standards of CFPA and the FTC. Therefore, the failure of businesses to provide high-quality products and services as well as their relevant advertisement is a failure to keep ethical responsibility towards their clients. How is the given rule implemented when it comes to the ethics of selling dangerous goods? The quality of hazardous products is extremely important. For instance, as a rule, the product becomes dangerous if it is defective or buyers are not provided with a relevant manual. However, dangerous products, such as firecrackers pose a risk to human life even without a chain of unfortunate circumstances. That is why the legal and ethical responsibilities towards consumers are even more accentuated when it comes to selling dangerous goods comparing with the sale of other products. Considering this thought, it seems to be impossible to provide an honest advertisement of dangerous products. The FTC defines the deceptiveness of an ad in terms of the likelihood of its misleading reasonable consumers. It means that the CEO of a company may find a way to maintain a legal business by selling some dangerous products. Nevertheless, even without crossing the legislative line, a given company is more likely to have numerous issues with the CFPA and the FTC, because they do not maintain the ethics of social responsibility towards their consumers.
Ethics and Shareholders
The shareholders, as participants of business interaction, often determine what types of social responsibility if any the company will maintain. For instance, if one or several investors are the supporters of a valued-based policy, the entire organization is more likely to establish and keep the course of high ethical standards. What is more, if shareholders want to make donations and in this way bend policy of a company with charity, these intentions will be implemented in daily performance because their opinion is essentially important for CEOs. On the other hand, if the investors do not care about ethical issues, the firm is in danger to develop double standards. For example, in order to demonstrate adherence to Christian values, the organization helps vulnerable people, but conceals the possible dangerous defects of their products they produce. The given example arouses the presumption that shareholders are responsible to what extend and what types of social responsibility is implemented in a certain company. The business owners have at least three types of liabilities towards their investors: economic, legal, and ethical. For example, the 4th article of Universal Declaration of Human Rights claims ‘No one shall be held in slavery or servitude; slavery and the slave trade shall be prohibited in all their forms.’ Meanwhile, a well-known fact is that human trafficking is still flourishing in the contemporary world. Dr. Leonard Territo works for the Department of Criminal Justice at Saint Leo University in Florida. He acknowledges the problem of women sex trafficking depicting the statistics U.S. State Department has estimated that between 700, 000 and two million women are trafficked each year worldwide and that as many as 50, 000 women and children are trafficked into United States annually, primary from Latin American countries and the former Soviet Union and Southeast Asia. What possible legal, ethical, economic, and philanthropic issues does this business have? First and foremost, it is a serious legal issue for those who are in a human trafficking business, because it is a criminal perpetration. The owner has economic issues as the main task of this person is to make a profit. The lower the income is, the bigger is the economical problem with shareholder(s). As for the ethical and philanthropic issues they are obvious in the given situation. On the one hand, in terms of ethical consideration, people trafficking cannot be distinguished as a dangerous product and it is true. However, firstly, it is rather dangerous to become this product, and secondly, human trafficking is the source of numerous health issues especially of sex transmitted diseases. The U.S.A. policy regarding the given issue estimates the problem arousing the question ‘Are the links between human trafficking and HIV/AIDS receiving adequate attention?’ Therefore, this business has strong legal, ethical, and philanthropic issues; however, in terms of owner’s responsibility to shareholders, the only relevant problem is an economic issue. The given sample demonstrates how the needs and priorities of shareholders stipulate the level and the amount of social responsibility in a certain business field.
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Ethics and Communities
The biggest group of stakeholders is the community. To show the interdependence of the community and businesses, one should refer to the characteristics of every community. First of all, community includes people who share something in common whether it is hobbies, religious believes, nationality, geographical borders, etc. The given similarity is the core that unites different people. It is something that ties every member of the community. That is why the word of mouth (the advertisement) spreads rapidly inside one group of people. It may advertise the product either in a positive or in a negative way. Therefore, it is vitally important for every company to make friends with the communities, especially with those in which the given business develops. Likewise, the community makes a great impact on progress of the company, the manager of the company is capable to affect people’s needs and views with the help of a good advertisement. For instance, to excel in his/her business a drug dealer must persuade as many people as possible that to be high is cool. In other words, the task of such person or organization is to cause harm to a particular community. Therefore, the given type of business cannot maintain social responsibility; it violates the business ethics and arouses legal, ethical, and philanthropic issues. Another responsibility towards community is saving the environment. Unfortunately, this liability is often violated by different legal companies not even talking about those who sell dangerous products. For example, a person sells dynamite to fishermen; in this illegal way they kill lots of fish changing the natural balance of the marine life. The seller of dynamite neglects social responsibility in several ways. First of all, this action is illegal, thus, in this way, the seller increases the level of crimes in a given community. Secondly, it is an ethical issue relatively his/her consumers, because the quality of dynamite is not checked. Moreover, the seller encourages those purchasing dynamite to commit a crime. That is why his/her performance becomes an ethical issue towards the entire community since people do not live in a vacuum but rather intensively interact. Thus, such business, whether it is one person or a group of people, violates social responsibility and business ethics.
In a modern society, there is a strong tendency towards emotional and moral evolvement. Every day, more people comprehend the importance to act respectively and responsibly towards other individuals, communities, and organizations. What is more, it is essential for human survival to be responsible for nature and utilize its resources wisely. For that matter, it is a strategic, ethical, and pragmatic necessity for every business owner to maintain corporate social responsibility that includes economic, legal, ethical, and philanthropic responsibilities. The organizations, which sell dangerous products, should be under a strict control of the judicial branch in each state. The laws should protect people from deceptive and misleading businesses. Every individual should constantly work on his/her self-development and self-improvement in order to be capable to follow ethical social norms. The rising of people’s moral intelligence will bring mankind the new desired standards. The given approach will lead to fair business performance with safe, high-quality goods and services as well as an honest presentation of those commodities. In addition, it will help improve occupation safety making a working place a better place to be.