CorporateSocial Responsibility and Ethics
CorporateSocial Responsibility (CSR) and Ethics
Descriptionof social responsibility
Today, CSR hasbecome a dominant concept in the business world since it concernswith the correlation between corporations, governments, andindividual citizens. This means that CSR is a social contract betweenfirms and the society, which implies an altruistic behavior on thepart of corporations. Most scholars posit that organization’sactivities impact on the society or external environment thus, firmsmust integrate environmental and social concerns in their activities(Lindgreen & Swaen, 2010). Furthermore, corporations are legalentities through which people act toward the realization of thestakeholders’ needs. As legal entities, firms have an obligation ofseeking to offer for human needs and to adhere to the rights of alegal citizen. Therefore, they are expected to conform to societalcustoms and values.
Lindgreen and Swaen (2010) and Murphy and Schlegelmilch (2013) defineCSR as the transparency in a corporation’s tactically adoptedbusiness activities or practices developed on conformity to societalvalues, ethical values, and legal requirements. On the other hand,Popa and Salanta (2014) define CSR as a firm’s effort to attain abalance between social, environment, and economic aspects withoutforegoing the prospects of stakeholders. This means that corporationsneed to be accountable and responsible for the impacts of theiractivities and decisions on environment and society through ethicaland transparent conduct. Furthermore, the firms must ensure thattheir activities comply with the spirit of societal, ethical,international or local and law norms. Firm’s responsibility takesdiverse meanings depending on the context and the operations of thefirm. According to Terris (2005), CSR can be interpreted to relate toaccountability, for example, a business can be held accountable foractivities, which result in ecological degradation. Responsibilitycan also entail the characteristics or the specific roles of thelegal citizen, for instance, the perception that a firm is aresponsible citizen.
Descriptionof corporate social irresponsibility
Firms sometimesfail to meet the expectations of the society, for example, servingthe society in an effective manner. Additionally, in attempting toattain their objectives, firms may engage in irresponsible orunethical behaviors, such as, bribery, social injustice, ecologicaldegradation and corruption. Popa and Salanta (2014) refer to CSI asthe failure by firms to meet the expectations of the society. Thismeans that CSI concerns with unethical behaviors or the failure bythe organizations to act in a desired and responsible manner. It isimperative to note that CSI does not only mean irresponsible orfailing to align a firm’s objectives with societal, economic, andenvironmental aspects, but it also means unethical behavior.Instances of CSI include violation of human rights, discrimination,fraud, environmental degradation, price-fixing approaches, and unfairtreatment of workers. Firms that support CSI in total disregard ofCSR see environmental degradation as unavoidable, workers asresources that need exploitation, society involvement, and ethicalissues as insignificant, profitability as their sole purpose, andsustainability as concerning their survival. Thus, CSI has asignificant correlation to CSR since firms must either actresponsibly or irresponsibly. Firms committed to CSI push theirinterests at the expense of other firms, societies, and governments.
Standon the issue of CSR and CSI
In the corporateworld, it is difficult to always act ethically or to meet thesociety’s expectations. Therefore, most scholars consider CSR tocoexist with CSI as the management’s actions or decisions aresometimes balanced in the conduit between unethical and ethicalaspects (Popa & Salanta, 2014). Firms are legal citizens andtheir most important objective is to obey the existing laws andregulations, which shows that it is more important for them to manageirresponsibility than to promote CSR. According to the notions ofbusiness ethics, firms have a corporate and legal character. However,it is also imperative to note that corporations do no have the moralaccountability to ease situations for profit maximization in favor ofCSR obligations. Shareholders are the owners of an organizationthus, firms as legal entities are contractually devoted to act inaccordance with the expectations of the investors. This shows thatfirms should attempt to meet the expectations of the shareholders andact ethically or according to laws set in areas they operate (Murphy& Schlegelmilch, 2013). In addition, it is not right for themanagement to utilize resources in the advancement of socialobjectives.
Rather than conforming to a political function, or what mostscholars, for example, Murphy and Schlegelmilch (2013) and Popa andSalanta (2014), regard as social goals, firms should attempt torealize shareholders’ goals and expectations. Stakeholders have acontract with corporations and it would be wrong for any organizationto regard the investors as conventional resource owners. Investorsare entitled to returns on investments as they have invested in theorganization thus, firms should not utilize their resources inethically or societal sound projects. As Popa and Salanta (2014)point out, firms should attempt to control irresponsible sincefailing to meet the expectations of the society especially those ofthe investors can be devastating to going concern of an organization.Firms should not only promote CSR, but they should also consider theexpectations of the shareholder and prevent unethical activities.
Lindgreen, A., & Swaen, V. (2010, March). Corporate socialresponsibility. International Journal of Management Reviews.1-7
Murphy, P. E., & Schlegelmilch, B. B. (2013). Corporate socialresponsibility and corporate social irresponsibility: Introduction toa special topic section. Journal of Business Research, 66(10),1807-1813.
Popa, M., & Salanta, I. (2014). Corporate social responsibilityversus corporate social irresponsibility. Management &Marketing, 9(2), 137-146
Terris, Daniel. (2005) Ethics at work: Creating virtue at anAmerican corporation. Brandeis University Press. Waltham, MA