In the last decade, in particular, empirical research has brought evidence

of the measurable payoff of corporate social responsibility (CSR) initiatives

to companies as well as their stakeholders. Companies have a variety of reasons

for being attentive to CSR. This report documents some of the potential bottomline

benefi ts: reducing cost and risk, gaining competitive advantage, developing

and maintaining legitimacy and reputational capital, and achieving win-win

outcomes through synergistic value creation. For details see: https://www.conference-board.org/retrievefile.cfm?filename=1156_1307550372.pdf&type=subsite

Mark, I think that social responsibility is very important, however, I consider the scenario today is the sustainable management, as a higher stage of social responsailidad.

My response to your question is yes. The reasons are the following:

Corporate social responsibility (CSR) is a corporation's  initiatives to assess and take responsibility for the company's effects on environmental and social wellbeing. The term generally applies to efforts that go beyond what may be required by regulators or environmental protection groups.

CSR may also be referred to as "corporate citizenship" and can involve incurring short-term costs that do not provide an immediate financial benefit to the company, but instead promote positive social and environmental change.

Corporations can have enormously detrimental effects on the environment. Oil spills are some of the most conspicuous examples, but industries as varied as chemical manufacturing, mining, agriculture and fishing can do permanent damage to local ecosystems. Climate change can also be attributed in large part to corporations. While their responsibility is hard to untangle from that of the consumers who demand electricity and transportation, it is difficult to deny that many corporations have profited from the deterioration of the global environment. 

In light of this often dark legacy, some areas of corporate culture have begun to embrace a philosophy that balances the pursuit of profit with a commitment to ethical conduct.

The same money and influence that enable large companies to inflict damage on people and the environment allows them to effect positive change. At its simplest, a corporation can give money to charity. Companies can also use their influence to pressure governments and other companies to treat people and resources more ethically. Companies can invest in local communities in order to offset the negative impact their operations might have. A natural resources firm that begins to operate in a poor community might build a school, offer medical services or improve irrigation and sanitation equipment. Similarly, a company might invest in research and development in sustainable technologies, even though the project might not immediately lead to increased profitability.

In order to account for the importance of social and ecological considerations in doing business, some organizations advocate the concept of the "triple bottom line": social, environmental and economic – or "people, planet, profit."

In recent years, supply chains have emerged as a central focus of corporate social responsibility. Company X's management might make extraordinary efforts to hire, foster and empower a diverse workforce. They might offer generous paid maternity and paternity leave. They might sponsor after-school programs in crime-affected neighborhoods, fund the clean-up of local river systems and put pressure on elected officials to consider the needs of all citizens rather than simply seeking political expediency. None of that would change the fact that they source their raw materials, albeit indirectly, from outfits that use slave labor.

Today, a shift has occurred in the way people conceptualize corporate social responsibility. For decades, corporate business models have been assumed to be necessarily harmful to certain communities and resources. The intention was therefore to mitigate or reverse the damage inherent in doing business.

Now many entrepreneurs consider profit and social-environmental benefit to be inextricable. Few tech startups pitch their ideas without describing how they will change the world for the better. Social media platforms believe they will facilitate democracy and the free exchange of information; renewable energy companies believe they will make money by selling sustainable solutions; sharing economy apps believe they will cut down on the waste and inefficiency of a post-war economy myopically geared toward the individual consumer.

Some think corporate social responsibility is an oxymoron. Others see corporate social responsibility as a distraction of a different sort, that is, from the lawful pursuit of profits. To them, a corporation's sole responsibility is to generate returns for its shareholders, not to try to save the world or to fret over its own impact. Laws and regulations must be followed in all jurisdictions in which the company operates, but management should not go beyond that, as that could hurt its bottom line and violate its duties to the owners. Some counter that this concerned is misplaced, since responsible initiatives can increase brand loyalty and therefore profits. This may become increasingly true as ethical consumer culture gains wider acceptance.

A few cynical executives will inevitably try to portray themselves as responsible when they are decidedly not. And for some critics, nothing short of a massive overhaul of the world system will suffice. The truth is that many large corporations are devoting real time and money to environmental sustainability programs and various social welfare initiatives. These activities should be encouraged, but at the same time, continually questioned and reassessed. 

In 2010, the International Organization for Standardization released ISO 26000, a set of voluntary standards meant to help companies implement corporate social responsibility.

There is a strong business case, but the problem is that the benefits, such as lower employee turnover, recruiting and training costs plus increased customer loyalty are very hard to quantify on the income statement, while the costs are easy to classify and find on the income statement. So in the short term at least, the tendency is to under-invest in socially responsible activities as this helps to boost short term income.

Dear  Mark Camilleri

Greetings,

I think the CSR is very important issue for the business and organizations , because now all firms face  a strong  and  change environment , so to have competitive advantage in the market , the firms need to participate in CSR in society . On other words the CSR , may be increase the market share and profitability in indirect side . Finally , I think the CSR is playing a vital role in market and firms to sustain and development the products and keep the  customers .

Best Regards, 

I do not think so. The main reason is because there is not regulatory framework behind CSR (this is as not being compulsory for companies). Also, there is a divergence between SMEs and Big companies in terms of resources (human factors and timing as well as financial resources). Consequently, I do not think that we could extrapolate from one case study to build up conclusions.

I am adding the same answer I provided to another colleague about CSR from a critical perspective:

Since CSR is not a standard (as defined by IFRS; IASs and ISAs), the fact that a company does not publish disclosures regarding CSR does not necessarily imply that there is not fully or partially CSR considered (for example in terms of social  or economical aspects). CSR disclosures are voluntarly for entrpreises in Europe and are cost and time consuming. SMEs may apply for example an environmental aspect since SMEs tend not to have enough resources (human factor or economical-timing) to write further notes. 

CSR are normally published by big companies because they have resources to do so, but again some information may not be disclosure deep enough.

I would also highlight another aspect of CSR commonly forgotten (it may potentially recent) that it is the institutional one. This is specific regulatory framework applied to some companies due to be performing in very specialised sectors that may be regulated (energy) or sectors that affect the social welfare in specific countries (connectivity in terms of airports such as in Norway, etc.) that may imply tailored standards or sections of them and it is essential to reflect this as part of CSR.  

I wish this helps, Ane

The question is so broad. We have first to agree on what CSR is and secondly, we have to be accurate about performance (financial performance? cash flow? net of risk? short-term or long-term performance? 

to my mind, the reference study was made by Margolis, Elfenbein and Walsh. You can find it in SSRN, I don't know if it was published. It is a meta-study of many research papers. Besides, Margolis and Elbenfein presented a short note in HBR (January 2008), the title is clear: "Do well by doing good?: don't count on it". Simply put, misdeeds can cost money to the company (we may think of an oil spill), while the impact of doing good is not so clear. At least it seems that doing good is not bad for shareholders.

yours

Dear all,

I have recently announced a call for chapters on the CSR Agenda. I am more than pleased to invite you to submit your contributions. More details are available here: http://www.igi-global.com/publish/call-for-papers/call-details/1993

Best Wishes,

Mark

http://www.igi-global.com/publish/call-for-papers/call-details/1993

Hi,

I think you may be interested by this paper finding a positive relation between CSR and value, and finding that CSR attenuates the negative relation between managerial entrenchment and value:

A Ferrel, H Liang, L Renneboog, "Socially responsible firms", Journal of Financial Economics, 2016 forthcoming.

Best regards.

Dear all,

Further to my previous communication I am very pleased to let you know that my edited business textbook entitled; 'CSR 2.0 and the New Era of Corporate Citizenship' will be published in March 2017.

This contribution is an authoritative reference source (for the latest scholarly research) on the ways in which corporate entities can implement responsible strategies that create synergistic value for both businesses and society. The authors (hailing from leading European universities) contend that responsible behaviors in the realm of business continue to remain a crucial component of organizational development.

By exploring core aspects of contemporary corporate strategies, businesses can create more value through social welfare and sustainable initiatives. This publication features an extensive coverage across a wide range of perspectives and topics, including corporate citizenship, corporate sustainability and responsibility, stakeholder engagement, business ethics, public spending, total responsibility management and social value co-creation, among others.

This publication consisting of 16 chapters (by 33 academics and researchers) is ideally designed for students, academics and researchers seeking current concise and authoritative research on the business case for corporate social responsibility.

Best wishes,

Mark

http://www.um.edu.mt/newspoint/news/features/2016/10/csr2.0andtheneweraofcorporatecitizenship

http://www.igi-global.com/book/csr-new-era-corporate-citizenship/166426

Dear Mark,

in my view, CSR spending should be anaylsed by companies in the same way as it is done with other expenditure. Does charitable spending add new customers? Do employee programs reduce employee turn-over above a predetermined threshold? Can additional sales be traced back to social compaigns? Clearly, the last point is difficult to measure, but mature companies should have enough data from the past to be compared with current developments. At least, this remains an interesting challenge for management accountants.

Paul