Good Example Of Theories Of Ethics And Corporate Social Responsibility As A Part Of Organizational Strategy Critical Thinking
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Issues of ethics and corporate social responsibility (CSR) are of utmost importance for recent organizations hat adopted these issues as a part of strategy within and outside of the company. A concept of CSR has become a core element in many respected companies nowadays while it contributes to the image and reputation of the company and motivates employees to increase labor productivity. In this paper we will try to analyze the theoretical background of ethics and CSR ideas and set examples of successfully used socially oriented corporate practices.
keywords: corporate social responsibility (CSR), ethics.
In business and in life, we often know what is the right thing to do,
but we have trouble implementing it
Walter Isaacson, CEO of the Aspen Institute, 2007.
Making profit is a commonly accepted goal of any organization/corporation. Being one of the major motivating factors money driven behavior has to be determined by the set of codes called ethics, which should be applied each time when a moral hazard in the organization arises. These moral hazards comprise definitions of what obligations should be ensured by the corporation in case of competing interests, employment seeking, advertising and other issues which are supposed to be handled fairly (McCorquodale, R., 2009). In order to develop an understanding of the ethical framework in the organization alongside with corporate social responsibility involvement into business motivation and profit seeking, we need to study the recent theoretical findings. Ethics is often defined as a “moral compass” in recent literature, which is in fact a philosophy categorizing, advocating and conditioning the notions of right and wrong. Distinguishing between different theories of ethics, we can stress meta-ethics, descriptive ethics, normative ethics and applied ethics, which we will consider in more detail with its respect to corporate ethics. In fact, corporate ethics is a form of applied ethics having also traits of normative and descriptive characteristics.
The role of decision-making process guided by the codes of conduct and moral principles should be of primary importance for business operating especially when rights of employees, stakeholders, partners and suppliers are considered. Corporation holds a broad variety of responsibilities, which demand ethics to be employed. In fact, there are three main theoretical concepts to expanding corporate responsibilities and they are corporate social responsibilities, shareholders theory and the triple bottom-line. Evolution of ideas in corporate social responsibility sphere emerged in 1950s in works of Howard R. Bowen (1953) “Social Responsibilities of Businessman” and were developed further in scientific review “Corporate Self-Interest Model” (Wallich and McGowan, 1970). Interconnections between corporate social responsibilities (CSR) and social responsiveness like employees’ motivation, corporate values and moral principles were first discussed in research of Wartick and Cochran (1985). Empirical findings show that 500 top companies stated corporate social responsibility as a chief corporate value have earned by this around 90% profit showing that employees motivation is a great driving force stimulating innovational ideas, diversification ideas and desire to increase labor productivity (Min-Dong, 2008). Besides, employees’ motivation triggers uprising of new legislation, implementation of new targets, improving public relation issues and, finally, reputation – the most important asset of a respected company.
The idea of CRS holds four main obligations: the economic responsibility to earn profits, the legal responsibility to follow sets of codes, the ethical responsibility to distinguish right and wrong; and the philanthropic responsibility concerning certain contribution to social issues, charity and volunteering (Whelan G. et al., 2009). CRS may be differentiated by sphere of business having certain set of codes for each of the management fields like environmental, social, economic, shareholder demanding straightforward and honest fulfillment of obligations beyond legal contract and requirements. CSR concept is closely connected with ethics by “loyal corporate brand community of customers that can enhance corporate value” (Fukukawa et al., 2007).
Verdigris Group, a real estate consulting firm can set a good example of ethics and CSR implementation. This company has developed a variety of business initiatives going in line with triple bottom-line approach motivating employees to participate in different kinds of social projects and environmental communities. Another example is RBC Wealth Management-USA having around $300 billion of assets introduced the “The RBC Blue Water Project a 10-year global commitment” to help countries being in need of drinkable water to enjoy one of the most important natural resources by investing $ 60 million philanthropic charity to clean and protect watersheds. Besides, this corporation organizes local events for free. Similarly, one of the most prominent law firms – DLA Piper, stating corporate ethics to be of primary importance, contributes to CSR by introducing different socially oriented projects. DLA Piper developed a free of charge program “Signature Projects” aimed at dealing with socially oriented issues like education, juvenile justice, protection from home violence, helping elder people and many other social issues (Kolk A., et al., 2013). DLA Piper developed this program in cooperation with different academic institutions, charity funds, volunteering organizations and non-profit entities.
Concluding we should underline the utmost importance of ethic and CSR issues for recent organizations. For majority of respected companies it is a matter of good reputation to get involved in social issues and tackle the problems of social responsibility and justice. Social projects impact positively the company’s image, drives employees’ motivation and increases competitive advantage opportunities and should be seriously considered as a part of corporate strategy.
Bowen, HR. 1953, Social Responsibilities of the Businessman, Harper & Row, New York.
Fukukawa, K., Balmer, J. M. T., & Gray, E. R., 2007, Mapping the Interface Between Corporate Identity, Ethics, and Corporate Social Responsibility. Journal of Business Ethics, 76, 1–5.
Kolk, A., Lefant, F, 2013, Multinationals, CSR And Partnerships In Central African Conflict Countries. Corporate Social Responsibility and Environmental Management, 20, 43-54.
McCorquodale, R. 2009, Corporate Social Responsibility And International Human Rights Law. Journal of Business Ethics, 87,385-400.
Min-Dong, P. L., 2008, A Review of the Theories of Corporate Social Responsibility: Its Evolutionary Path and the Road Ahead, International Journal of Management Reviews, vol. 10 (1), pp. 53-73.
Wallichm H. C., McGowan J. J.,1970, Stockholder Interest and the Corporation’s Role in Social Policy, in Baumol, W. J. (ed.) a New Rationale for Corporate Social Policy. New York: Committee for Economic Development.
Wartick, S. L., Cochran, P.L.,1985, The Evolution of the Corporate Social Performance Model, Academy of Management. The Academy of Management Review, 10, 000004; ABI/INFORM p. 758.
Whelan, G.; Moon, J., Orlitzky, M., 2009, Human Rights, Transnational Corporations And Embedded Liberalism: What Chance A Consensus? Journal of Business Ethics, 87,367-383.
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