LESSON PROPER- ETHICS AND SOCIAL RESPONSIBILITY IN BUSINESS OPERATION

What makes a business better in today’s generation? How do you know if your business is doing
well? Business whether large or small should try to do well in the world. Some businesses are
doing better because they create good products and provide good service, but they don’t stop
with that; they also do good things for the communities, for the environment, and for the causes
they “Doing Well for the Greater Good” are concern about. Companies are part of our society that
can be considered as individuals, they have a responsibility to ensure that they are good resident
of it. That is the reason why it is vital that they modernize and strive hard not just for the
growth of the business, but for the good and benefit of all the customers, employees as well as
the community.

Corporate Social Responsibility

• Defined as a rigorous initiative to contribute to sustainable development through efforts that

are economically, socially, and environmentally beneficial to stakeholders.

• CSR is a management concept whereby companies integrate social and environmental concerns
in their business operations and interactions with their stakeholders.

• Participating in CSR ensures that an organization works in ways that improve society and the
world in the ordinary course of business, rather than contributing negatively to them.

• Corporate social responsibility is a broad term which, depends on the organization and industry.
Businesses can support society through CSR initiatives, philanthropy, and charitable activities while
boosting their brands.

Triple Bottom Line

John Elkington introduced the phrase Triple bottom line in 1994. The “triple bottom line” has 3
elements, 1 people, 2 profits, and 3 planets. The purpose of this phrase is for the organization to
grow continuously or sustainably in the long term without focusing only on the profit. Based on
TBL theory, Businesses should work on these 3 bottom lines simultaneously:

1. People- companies now value individuals not as mere as products, but as an essential partner that
help the company grow. Examples of Philippine companies that excel in taking care of their
peoples are the following:

ACCENTURE

According to the company website, Accenture offers employees what it referred to as a “Total
Rewards” package. This package includes competitive compensation, a comprehensive benefits
package, professional growth opportunities, and programs to help employees balance work with a
healthy family oriented lifestyle. Accenture also places a huge emphasis on recognizing individual
contributions and performance.
HSBC (Philippines)

Hongkong Shanghai Banking Corporation one of the world largest bank, with their tagline “the
best place to work”, indeed HSBC is one of the top company when it comes to taking care of the
people in the organization. Aside from the good salary and benefits, they ensure that employees
are experiencing work life balance by conducting family days, core leaves etc. HSBC put high
importance on their employees and always recognizing their contributions and performances.

2. Profit- This is the conventional corporate benefit measure- profit and loss

-Financial responsibility is the process of managing money and other similar assets in business.

-Profit is a financial benefit that is realized when expenditures, costs and taxes are exceeded by
the amount of income earned from a business operation.

-Planet The third “in the Triple Bottom Line is “as the representation of the different application
patterned toward the care, conservation, and sustenance of the environment .

Johnson and Johnson on protecting the environment: “ We set high standards for our environmental
responsibility — operating companies in striving for performance that does not merely comply with
regulations but reduces our environmental impacts. We have a responsibility to take care of our
planet and preserve its beauty, resources and strength for future generations.”

Importance of Corporate Social Responsibility in Business

Being a socially responsible business will strengthen the reputation of a business and develop its
brand. Formal initiatives of corporate social responsibility will raise the morale of workers and
contribute to greater workforce efficiency. Business that exercises corporate social responsibility is
interested beyond profit margins. CSR has many advantages that can be a benefit to any business:

1. Good Business Reputation

2. An advantage over competitors

3. Increased awareness of the brand and recognition

4. Seeking and retaining talented employees

5. Good relationship with customers.

Elements of Corporate Social Responsibility

1. Economic Responsibility- Primary duty of a company is to help develop the economy and
achieve a status of development with other countries by generating employment. The economic
growth of a business is not restricted to itself but affects the society as a whole.
2. Legal Responsibility- As company is an organization itself, laws and regulations must also be
followed. Organization should obey not just local but also international standards that apply with
its business. A law abiding enterprise is generally responsible enterprise as well. The company is
free to do business, but only within the scope of different laws such as labor law, environmental
law, and criminal law.

3. Ethical Responsibility- Ethical obligations include the company's conduct, which is required by
society but not legally classified. Business should establish norms and values that reflect fairness to
all the stakeholders.

4. Philanthropic Responsibility/Discretionary Responsibility- Company is one of the community's

most significant foundations. Therefore, it should help and improve the society whenever i t can.
When an organization makes significant income, it is the corporate duty to donate money or its
products and services to society. It is also an obligation of a company to help the community in
meaningful projects which are beneficial to the people in the community.