Ethics and CSR

5. Corporate Social Responsibility

 Introduction to CSR
o Meaning of CSR
 Business is an economic activity to earn profit for the owner and
social responsibility means serving the community without any
expectation.
 Business organizations which form an important part of the society
and control a conspicuous share of the resources must be
responsive to the social needs
 Social responsibility is the manager’s responsiveness to public
consensus.
 Social responsibility refers to two types of obligations
 Socio-economic obligations
o The economic consequences of its actions do not
adversely affect the public welfare.
 Socio- human obligations
o To nurture and develop human values.
 History and Evolution of CSR
 Phase 1: (1850 - 1914)
o Purely philanthropy and charity during industrialisation;
corporation is only responsible to owners and managers.
 Phase 2: (1910 - 1960)
o CSR as social development during the Independence
struggle; corporation is responsible to owners, managers
and employees.
 Phase 3: (1950 - 1980)
o CSR under the “mixed economy paradigm”; corporation
is responsible to owners, managers and other target
environments.
 Phase 4: (1980 onwards)
o CSR in a globalised world is in a confused state;
corporation is responsible to owners, managers, other
target environments and the public at large.
o Definition of CSR
 A business enterprise has an obligation towards the society that
extends beyond its narrow obligation to its owners or shareholders.
o Social Responsibilities of Business towards different groups
 Towards the customers
  To provide proper quality product to the customers at a fair
price
 Towards prospects

 Towards the community
 Protecting the community and preventing it from the
industrial hazards.
 Setting up educational institutions, hospitals, social service
institutions
 Assisting people during natural calamities
 Towards the human resources
 Looking after the welfare of the employees by giving fair
wages, bright career prospects, proper organizational
climate
 Towards the society and ecological environment
 Treating the whole globe as a society for the organization
 Adopting villages for developmental activities
 Towards the government
 Paying taxes and duties on time
 Co-operating with the government in their social welfare
projects
 Abiding by the laws laid down by the government,
 Towards the global business environment

 Concept of Charity
 Corporate Philanthropy
 Corporate citizenship
 CSR- An Overlapping Concept
 Concept of Sustainability and Stakeholder Management