BUSINESS ETHICS AND CORPORATE SOCIAL RESPONSIBILITY PREPARED BY NAME:SURAJ VISHWKARMA ROLL. NO. :44 CLASS:T. Y. B. M. S. COLLEGE:CLARA’S COLLEGE OF COMMERCE TOPIC Write an essay on Corporate Social Responsibility with suitable example to support your literature. CORPORATE SOCIAL RESPONSIBILITY Being social is a noble idea that works beyond the objective of maximum growth & possibility. The business organization must use their infrastructure & resources to protect & promote public interest & social values.
Social obligation is a commitment on the part of businessman to produce & supply only those goods which are demanded by the society & refrain from activities that will go against the interest of the society. Corporate social responsibility (CSR), also known as corporate responsibility, corporate citizenship, responsible business, sustainable responsible business (SRB), or corporate social performance, which means to operating a business that meets or exceeds the ethical, legal, commercial and public expectations that society has of business.
Corporate Social Responsibility is one such niche area of Corporate Behavior and Governance that needs to get aggressively addressed and implemented tactfully in the organizations. At the same time CSR is one such effective tool that synergizes the efforts of Corporate and the social sector agencies towards sustainable growth and development of societal objectives at large. The term “CSR” came in to common use in the early 1970s, after many multinational corporations formed. The civil rights movement, consumerism, and environmentalism affected society’s expectations of business.
Based on the general idea that those with great power have great responsibility, many called for the business world to be more proactive in (1) ceasing to cause societal problems and (2) starting to participate in solving societal problems. Many legal mandates were placed on business related to equal employment opportunity, product safety, worker safety, and the environment. Furthermore, society began to expect business to voluntarily participate in solving societal problems whether they had caused the problems or not.
This was based on the view that corporations should go beyond their economic and legal responsibilities and accept responsibilities related to the betterment of society. This view of corporate social responsibility is the prevailing view in much of the world today. Such obligation is not something which is enforced or thrust upon business organization. Business people should come forward voluntarily to discharge their social obligations. An approach for CSR is becoming more widely accepted in community-based development approach.
In this approach, corporations work with local communities to better themselves. For example, the Shell Foundation’s involvement in the Flower Valley, South Africa. In Flower Valley they set up an Early Learning Centre to help educate the community’s children as well as develop new skills for the adults. Marks and Spencer is also active in this community through the building of a trade network with the community – guaranteeing regular fair trade purchases. Often activities companies participate in are establishing education facilities for adults and HIV/AIDS education programmes.
The majority of these CSR projects are established in Africa. JIDF For You, is an attempt to promote these activities in India. A more common approach of CSR is philanthropy. This includes monetary donations and aid given to local organizations and impoverished communities in developing countries. Some organizations do not like this approach as it does not help build on the skills of the local people, whereas community-based development generally leads to more sustainable development. Another approach to CSR is to incorporate the CSR strategy directly into the business strategy of an organization.
For instance, procurement of Fair Trade tea and coffee has been adopted by various businesses including KPMG. Its CSR manager commented, “Fair-trade fits very strongly into our commitment to our communities. ” Another approach is garnering increasing corporate responsibility interest. This is called Creating Shared Value, or CSV. The shared value model is based on the idea that corporate success and social welfare are interdependent. A business needs a healthy, educated workforce, sustainable resources and adept government to compete effectively.
For society to thrive, profitable and competitive businesses must be developed and supported to create income, wealth, tax revenues, and opportunities for philanthropy. Many approaches to CSR pit businesses against society, emphasizing the costs and limitations of compliance with externally imposed social and environmental standards. CSV acknowledges trade-offs between short-term profitability and social or environmental goals, but focuses more on the opportunities for competitive advantage from building a social value proposition into corporate strategy.
An organization has to play a vital role towards various public, which are customer, employees, government, shareholders ; society in large. The success ; growth of the organization depends on the relationship with the members of the society. Business act as a trustee of society, therefore it must discharge its social obligation towards various section of the society ; protect their interest whenever is needed. If the company takes good care of the member of the society, it will act as an investment which will result into good return to the company in the long run. Corporate Social Responsibility toward Employees: The business organization should provide the best working condition to the employees, which makes the work place attractive ; enjoyable to employees. The good working conditions motivate employees to put their best efforts. *The business organization should provide opportunities for meaningful work, i. e. to give right type of job to right type of person. *The organization should never manipulate its employees on the basics of caste, color, religious, creed etc. *The organization should provide facilities for training, education ; promotion for the development of employee’s abilities.
Such facility should be provided for the overall development of an employee. *The organization should recognize the rights of the employees, i. e. the right to join trade union, share the profit, join a strike and participate in decision making. *The organization should give job security to the employees. The company should introduce code of conduct for employees, like complaints or grievances should be solved immediately. *The work of employees should be rewarded ; appreciated. It gives encouragement to the employees. *The organization should pay fair wages ; allowances to the employees.
Employees should be given allowances like medical facilities, bonus educational allowances, travelling allowances. *The employees should never be exploit or hares by any part of the organization. Corporate Social Responsibility toward Customers: *Every firm should ensure the supply of good quality of products ; services. There should be no compromises on the quality of goods. *The goods or services must be distributed at fair ; reasonable prices. Sale of cheap ; inferior goods at low prices must be avoided. *The consumer must know all the information about the product or service.
It is the duty of the company to inform the consumers about the quality, quantity, purity, standard, life ; price of the product. *The consumer must be assured of adequate ; regular supply of goods. It should reach in time. Company should avoid creating artificial scarcity. *There must be healthy competition among firms ensuring supply of goods at reasonable prices. Free ; fair competition avoids the growth of monopoly. *The company must assure proper arrangements to provide prompt ; effective ‘after sales service’ to the consumers. *The company should attain complaints ; grievance from consumer quickly ; promptly. The company should give top priority to recognize ; respect consumer rights such as right to safety, right to be informed, right to choice, right to be heard, right to consumer education ; right to educate. *The company must not provide misleading advertisement. *The company must take all possible efforts to check ; avoid malpractices such as adulteration, profiteering, black marketing etc. Corporate Social Responsibility toward Government: *Every organization must make a regular practice to pay all kinds of taxes like sales tax, income tax, excise duty etc on time. The organization should follow rules ; regulations laid down by the government. *No organization should adopt corrupt practices to influence bureaucrats to get their work done. It should always indulge in fair ; honest practices. *The organization should take all possible efforts to promote exports in order to earn foreign exchange for the nation, at the same time it should reduce imports. *The organization should not encourage any activity that would go against political stability. It should not try to enjoy political advantage by providing financial support to politician for the sake of personal benefit. The organization should extend its supporting hand to the government in times of crisis. It should generously donate funds when the nation is faced with emergencies like floods, drought, earthquakes etc. *A business firm must show concern for balanced economic growth by setting up industries in the backward regions. Corporate Social Responsibility toward Shareholders: * The shareholders expect the management to raise its goodwill ; maintain a fair public image. Good image enhances its reputation in the market. * Shareholders expect from management not to manipulate prices of shares.
They should not indulge in any kind of unhealthy practices to push the prices of the shares. *The company should fulfill the expectation of the shareholders to expand ; diversify its business operation so as to ensure high returns on their capital. *The funds of the company must be fully ; properly utilized in order to maximize profits. The funds should never be diverted towards purposes other than business. *Meetings of shareholders should be held regularly ; every member should be given an opportunity to express his views. *The company must ensure fair returns on investment made by shareholders. The management is expected to maintain proper accounts which are duly audit from time to time. There should be high degree of transparency in such matters. Every shareholder must get a copy of balance sheet of the company along with the details of profit ; loss account. *The company must take all efforts to provide the shareholders adequate representation ; participation in the management. Corporate Social Responsibility toward Society: *The business organization should create employment opportunities ; provide better life in the society. The organization should prevent environmental pollution by taking the necessary preventive measures ; maintain ecological balance. *The organization should provide financial help to social ; cultural activities by contributing towards society for education, primary health care, population control ; rural development. *The organization should try to take care to preserve scarce resources for the benefit of society. It should make optimum utilization of such resources. *The business organization should develop new technology ; products by conducting market research.
The business organization should invest money for market research to give new technology to the society. * The business organization should try to promote ; develop small scale industries in rural area ; also labor oriented industries in rural area. Thus it should help in development in underdeveloped areas. *The business organization should take on tree plantation ; preservation of wild life ; natural resources. *The business organization should not contribute finance to anti social elements. The organization should not participate in anti-social activities. The business organization should expand ; diversify the industries which will create more employment for the society. The expansion of industries also tries to improve the standard of living of the society. Apart from this the company must protect supplier, distributor, investor ; debenture holder and must not manipulate their beneficial which they have on the organization. Examples: Rehabilitation to Tsunami Wipro Cares has adopted Pushpavanam village in tsunami-ravaged belt of Tamil Nadu with a desire to rehabilitate survivors and rebuild the village.
Their partner in this effort is BITsunami, a trust formed by the alumni of BITS, Pilani. Pushpavanam, about an hour’s drive from Nagapattinam, has around 1200 households with a population of about 6000. It lost 19 people to the tsunami which washed away 200 houses; 500 families lost their livelihood and another 250 families were affected indirectly; 35 boats supporting around 200 families, an important means of livelihood were lost or damaged and almost all cultivable land (about 100 acres) was left barren, leaving both cultivators and the agricultural laborers without a means of livelihood.
Restoring Ecological Balance Tata Motors has set up effluent treatment facilities in its plants, to avoid release of polluted water into the ecosystem. In Pune, the treated water is conserved in lakes attracting various species of birds from around the world thus turning the space into a green belt. Tree plantation programmes involving villagers and Tata Motors employees, have turned acres of barren village green. Tata Motors has planted as many as 80,000 trees in the works and the township and more than 2. 4 million trees have been planted in Jamshedpur region.
Over half a million trees have been planted in the Poona region. Tata Motors has directed all its suppliers to package their products in alternate material instead of wood. Notebook distribution Infosys CEO and Managing Director Kris Gopalakrishnan inaugurated a notebook distribution drive in Thiruvananthapuram, which benefited 4,000 students in 2009. Health Reliance Industries Limited conduct Health Awareness Programs, covering diverse topics such as noise pollution, hazards substance abuse, prevention of HIV/AIDS and First Aid for students of schools at the neighbouring towns and villages of Patalganga.
Barabanki Manufacturing Division also provides medical service and awareness programs on health, hygiene, cleanliness and sanitation in neighboring villages. Environmental Conservation at Sites Sony is engaged in a variety of environmental conservation activities at its sites as it works towards its “Green Management 2010” mid-term group environmental targets, to be achieved by 2010. In fiscal 2006, Sony’s emissions of greenhouse gases (calculated in terms of CO2) totaled approximately 2. 03 million tons, down 9% from fiscal 2000 levels.
Furthermore, waste from Sony sites was approximately 193,000 tons, down 30% from the fiscal 2000 level, while the amount of water used dropped approximately 16% from fiscal 2000 to 24. 18 million cubic meters. Making profit is the basic motto of any organization for which it accomplish many unfair business practices. Such practices not only harm the society but also the organization. Organization by its social conducts toward society can enrich goodwill which will lead to happy ; peaceful environment for society as well as the organization.