The main objective for a business is profit as it is the essential survival and growth of business enterprises. However, this is just the primary goal. In a company, people cooperate with each other to achieve one successful business. Most companies use the method of Social Corporate Responsibility (CSR) to work on business ethics, develop it economically as well as to improve the quality of the work style and production. CSR is defined as a form of corporate self-regulation combined into a business representative.
Survival and Existence of a Company depends upon how responsible a Company is towards the Welfare of the Society. More active a Company is, it is easier for them to build a healthy Brand Image in the eyes of customers which leads to working towards building Brand Equity. Different concerns have different definitions of Corporate Social Responsibility (CSR) like, “The continuing commitment by business to behave ethically and endow to economic development while improving the quality of life of the workforce and their families as well as the local community and society at large.” – World Business council for sustainable Development. “The clear definition of Corporate Social Responsibility is that community is not just another stakeholder in our business but the very purpose of our existence,” – Jamshedji Tata. Greater number of the private companies says that they grasp Corporate Social Responsibility (CSR) not only because it reinforces their Brand, but also it is the right thing to do.
Ethical leadership is a growing concept and many large companies are promoting business ethics as their corporate social responsibility. The behavior and the individual values of the leader provide the direction to the business. Leader’s actions in term of ethical behavior and unethical behavior gives ideas to the employee and other stakeholders that what need to follow and what values are aspired in an organization. The position of the leader with moral and ethical values is most important to provide the solutions to ethical issues in a workplace. This also evident from above discussion that ethical leadership is also crucial in developing the ethical culture within an organization.
Social responsibility is the idea that a company should embrace its social responsibilities and not be solely focused on maximizing profits. Social responsibility entails developing businesses with a positive relationship to the society in which they operate. The attempts to uphold sosial responsibility in an organization must be merged to become part of the organization culture so as to make it everlasting. Corporate social responsibility is a business approach that contributes to sustainable development by delivering economic, social and environmental benefits for all stakeholders. When corporate social responsibility is merged with business priorities, it brings about great significances.
Profit-Oriented or Socially Responsible? 2 Corporate Social Responsibility (CSR) plays a crucial role in organizations and societies. Traditionally, CSR is a management concept that has been implemented by most of the listed companies around the world. CSR is implemented by companies to be responsible for the company’s consequences on the environment and social welfare in their business operations and interactions with their stakeholders (Unido, n.d). In the other words, CSR is a program that benefits both society and business that do not provide immediate financial benefit to the company but environmental change and positive social (Investopedia,
Recyclable packaging, promotions that expand social knowledge and portions of advantages that benefit philanthropic groups are examples of social responsibility strategies. Multiple organizations have adopted social responsibility strategies in marketing in order to help the community whether provide services and products that benefit society. Furthermore, corporate responsibility goes hand in hand with social responsibility practices. For instance, executives, administrators, and shareholders must practice ethical behaviors and join the community in advancing responsible marketing purposes. For companies, the practice of deceptively developing environmentally friendly processes or products means to customers that the business is not committed to social responsibility and can eventually damage the brand and the success of a company.
Good governance facilitates efficient, effective and entrepreneurial management that can deliver stakeholders value over the longer term. It is about commitment to values and ethical business conduct. It is a set of laws, regulations, processes and customs affecting the way a company is directed, administrated, controlled or managed. Good corporate governance underpins the success and integrity of the organizations, institutions and markets. It is one of the essential pillar for building efficient and sustainable environment.
Thus; we can argue that organizational culture acts as a social control mechanism and sets the right framework for organizational processes in peoples’ mind (Sorensen, 2002). On the other hand according to Schein’s own words “corporate culture provides group members with a way of giving meaning to their daily lives, setting guidelines and rules for how to behave and most important reducing and containing the anxiety of dealing with an unpredictable and uncertain environment” (Sorensen, 2002). We can further identify three benefits of strong culture and its significance on company’s performance (Sorensen, 2002). Firstly based on Van den Steen theory (2010); organizational values and norms that are widely shared within a company can easily lead to more delegation; less monitoring; better communication; and to higher execution of effort. Furthermore as Kotter and Heskett (1992) supported on their research; shared values facilitate a social control amongst employees that contributes to easily detect and correct inappropriate behaviors and violations of any kind of behavioral norms.
The onus/obligations that business has towards society is termed as Corporate Social Responsibility (CSR) which are categorized as Economical, ethical, legal and philanthropic. CSR is a concept which states that companies not only consider their profitability but also the interest of the society and the environment in which it operates. One of the most contemporary definitions is from the world Bank Group, stating “Corporate Social Responsibility” is the commitment of business to contribute to sustainable economic development by working with employees, their families, local community and social at large to improve their lives in such ways that are good for business and for the development. Every business house has an obligation to society, the philosophy is to give back to the society what it has taken from it, in the course of its quest for profit maximization and wealth
SOCIAL AUDIT MEANING:- It refers to the evaluation or assessment of a company’s performance against planned goals in the area of social responsibility. Every society accepts business to share the fruits of progress and growth. A healthy business must and should do something for the benefit of the society. Therefore, every business must accept obligation to be socially responsible and to work for the larger benefit of the community. A social audit is mainly done to improve its cohesiveness or improve its image within the society.