Enterpreneurship and ebusiness

1. Unit-10
Corporate Social Responsibility

2. Unit-10 Corporate Social Responsibility
Outlines
▪ Corporate Social Responsibility
• Meaning
• Importance
▪ Business Ethics
• Meaning
• Importance

3. Unit-10 Corporate Social Responsibility
Corporate Social Responsibility (CSR)
▪ CSR is a management concept whereby companies integrate
social and environmental concerns in their business operations
and interactions with their stakeholders.
▪ CSR is generally understood as being the way through which a
company achieves a balance of economic, environmental and
social requirements while at the same time addressing the
expectations of shareholders and stakeholders.

4. Unit-10 Corporate Social Responsibility
Characteristics (Nature) of CSR
1) Concerned with social prestige
2) Applicable to both private and public sector
3) Balance between individual and social interests
4) Continuous process
5) Two-way process
6) Spirit of trusteeship
7) Essential for the growth of business

5. Unit-10 Corporate Social Responsibility
1) Concerned with Social Prestige
▪ Business is an activity connected with the production, sale or
distribution of a commodity or services with a view to satisfy
diverse needs of the society.
▪ The more effectively a business unit provides to the needs of
society, the greater will be its social reputation.

6. Unit-10 Corporate Social Responsibility
2) Applicable to Both Private And Public
Sector
▪ The concept of social responsibility of business is universal.
▪ Every business unit has certain social responsibilities. Whether it
functions in the private sector or in the public sector.
▪ For getting success, business need to earn respect from society
whether it is public sector or private sector.

7. Unit-10 Corporate Social Responsibility
3) Balance Between Individual and Social
Interests
▪ The business unit has to maintain a balance between its own
interests and those of the society.
▪ A firm that concentrates only on personal gains at the cost of
social interests cannot survive for long time.
▪ Similarly a firm that gives too much importance to social interests
at the cost of personal gains cannot survive and must close down
sooner or later.

8. Unit-10 Corporate Social Responsibility
4) Continuous Process
▪ Social responsibility is a continuous process. So long as business
functions, it must full fill its responsibilities towards the society.
▪ It has to provide society with the commodity or services
continuously.
▪ It has to maintain the quality of its product for ever.
▪ It has to maintain the prices of its product at its genuine level.
▪ It has to follow welfare — oriented activities continuously.
▪ Any disturbance in this continuous process would risk not only the
social status, but the existence of the business unit.

9. Unit-10 Corporate Social Responsibility
5) Two-Way Process
▪ As a business firm has to fullfill responsibilities to the various
sections of the society, at the same time society has to fulfill some
responsibilities to the business firm too.
▪ It is the responsibility of the society to create and maintain an
atmosphere which is favorable to the functioning and growth of
business firm.
▪ How can a business firm fulfill its responsibilities to society unless
it earns enough profit?

10. Unit-10 Corporate Social Responsibility
6) Spirit of Trusteeship
▪ The idea of trusteeship was proposed by Tolstoy, Ruskin and
Mahatma Gandhi.
▪ According to this principle, the managers of business are only the
trustees of their property and it is their moral duty to use and
manage all of their property for the welfare of the society.
▪ No individual has any right to hold any property for personal gain
only and to use it against the interests of society.
▪ All resources must be fully utilized for production of goods and
services.
▪ As far back as in 1927, a top industrialist had remarked,
“We consider ourselves to be the trustees of our wealth, which is to be
managed only for the benefits of workers and consumers”

11. Unit-10 Corporate Social Responsibility
7) Essential for the Growth of
Business
▪ A business firm that neglects the expectations of the society
cannot succeed.
▪ Caring attitude of various sections of the society is essential for
the success of business.
▪ The co-operation of the workers, good wishes of the local
population and attachment of the consumers are essential to the
growth of business unit.
▪ Therefore, the manager of business must not neglect their duty
towards all these section of society.

12. Unit-10 Corporate Social Responsibility
Advantages (Importance) of CSR
1) Satisfied employees
• Employees want to feel proud of the organization they work for.
• An employee with a positive attitude towards the company is less
likely to look for a job elsewhere.
• It is also likely that you will receive more job applications because
people want to work for you.
2) Commitment with stakeholders
• It enables enterprises to predict better and take advantage of fast
changing expectations in society as well as operating conditions.
• This means it can also act as a driver for the development of new
markets and create real opportunities for growth.

13. Unit-10 Corporate Social Responsibility
Cont…
3) Creating long-term employee, consumer and citizen trust
• By addressing their social responsibility, enterprises can build long-
term employee, consumer and citizen trust.
• This helps to create an environment in which enterprises can
innovate and grow.
4) Costs reductions
• Companies can reduce the costs by hiring the right person at the
right job with effective retention strategies.
• Because retention cost is lesser than recruitment cost.
• Organizations can also implement energy savings programs through
energy audits.
• Effective CSR can assist the companies in managing possible risks
and responsibilities very effectively.

14. Unit-10 Corporate Social Responsibility
Cont…
5) Win new business opportunities for sustainable future
• The business must be in a constant interaction with customers,
suppliers and other parties that affect the organization.
• Because of continuous interaction with other parties, your business
will be the first to know about new business opportunities.
6) Reducing the social effects of the crisis
• CSR also helps to reduce the social effects of the crisis, including job
losses, is part of the social responsibility of enterprises.
• CSR offers a set of values on which we have to build an organized
society and to look for sustainable economic system.
• It aims to create conditions favorable to sustainable growth,
responsible business behavior and long lasting job creation through
CSR.

15. Unit-10 Corporate Social Responsibility
Ethics
▪ Management ethics is the ethical (proper/right) treatment of
employees, stockholders, owners and the public by a company.
▪ Employees should be treated well, whether they are employed
here or overseas.
▪ Ethics and ethical behaviors are the essential parts of healthy
management.
▪ From a management perspective, behaving ethically is an integral
part of long-term career success.

16. Unit-10 Corporate Social Responsibility
Advantages (Importance) of Ethics
1) Satisfying Basic Human Needs
• Being fair, honest and ethical is one the basic human needs.
• Every employee desires to be such himself and to work for an
organization that is fair and ethical in its practices.
2) Creating Credibility
• An organization that is believed to be driven by moral values is
respected in the society.
• Infosys, for example is perceived as an organization for good
corporate governance and social responsibility initiatives.
• This perception is held far and wide even by those who do not even
know organization is doing what business.

17. Unit-10 Corporate Social Responsibility
Cont…
3) Uniting (bonding) People and Leadership
• An organization driven by values is respected by its employees also.
• They are the common thread that brings the employees and the
decision makers on a common platform.
• This goes a long way in aligning behaviors within the organization
towards achievement of one common goal or mission.
4) Improving Decision Making
• A man’s destiny is the sums total of all the decisions that he/she
takes in course of his life.
• The same holds true for organizations.
• Decisions are driven by values.

18. Unit-10 Corporate Social Responsibility
Cont…
5) Long Term Gains
• Organizations guided by ethics and values are profitable in the long
run, though in the short run they may seem to lose money.
• Tata group, one of the largest business corporations in India was
seen on the border of decline at the beginning of 1990’s.
6) Securing the Society
• Often ethics succeeds law in safeguarding the society.
• The law is often found acting as a mute spectator, unable to save
the society and the environment.
• Technology is growing at such a fast speed that when law comes up
with a rule we have a newer technology with new threats replacing
the older one.
• Law may not help society but ethics can.

19. Thank
You